SIGNALS CROSSED: While WHYY officials boasted of good financial times ahead, there's talk of cutting engineering jobs at the station. : Michael T. Regan

"Congratulations to WHYY," declared the beaming Molly Dickinson Shepard, chairperson of the TV and radio station's board, "one of the few nonprofit organizations in the Delaware Valley that's meeting its budget goals."

By meeting's end, the public broadcasting nonprofiteers had passed a budget for fiscal year 2007 designed to create a $1.6 million net surplus. But in the back of the boardroom, Thad Kirk wasn't in a very congratulatory mood. After the mutual back-patting ended, Kirk shared a different story he'd been told by management, one that included layoffs and slashed benefits.

"In the existence of the union group at WHYY, which began in the early '60s, this is the toughest contract negotiations there have been," says Kirk, an engineering technician and IBEW Local 98 negotiator. Though he hopes to resolve conflicts with WHYY's management before the current union contract expires this Friday, he warns that "a strike is more probable now than ever before."

According to Kirk, WHYY's union troubles began two years ago, when management changed employees' health care to a cheaper, less flexible plan. (The union represents 26 technicians.) Those whose medical conditions prevented them from making the switch were stuck paying the difference.

"Some of us went from paying around $100 per biweekly paycheck to paying around $400," says Kirk, adding one co-worker with prostate cancer was "financially hammered" by the cost-saving tactics.

A more recent sticking point is the installation of ACE, a system of automation that allows programs to be broadcast with less human supervision. Combined with a new digital archive, the technology will cost WHYY about $2 million. In response to the investment in equipment, the board has asked management to save $300,000 in technician costs. That means laying off five engineering technicians whose positions have been rendered obsolete. Union negotiations have led to alternative jobs for three and COO Bruce Flamm says he hopes to find new positions for the rest, but as of last week, two were still scheduled to lose their jobs on July 21. This explains why Kirk wasn't too happy to learn of a budget surplus.

"I was disturbed to see that surplus in light of the tough negotiations we currently have," Kirk says. "I guess this is just how they operate. They didn't expect us to find out the real story."

According to CEO and President Bill Marrazzo, tough decisions have to be made to keep the station viable. "Our goal is to keep all these good people on the payroll," he says. "Our goal for the community is to keep WHYY in a fiscally sound condition."

At a time when the U.S. House considers slashing public-television funding, some suggest local cost-cutting could start with spending less money on Marrazzo himself. A 2004 Forbes article, "No Wonder They Need to Raise Money All the Time," cited the high incomes of public broadcasting CEOs and listed the country's highest public radio and TV salaries. Marrazzo's topped the list.

According to the most recent tax documents available in WHYY's public records, Marrazzo's salary, benefits and expense account for FY2004 totaled $466,640. By comparison, Fresh Air's Terry Gross received a package for that year totalling $174,266. Radio Times' Marty Moss-Coane received $112,023.

WHYY spokeswoman Anna Christopher e-mailed that Marrazzo's salary is set by the board of directors, and that the 4-percent raise he received in 2006 was based on "outperforming industry benchmarks" in audience growth and fundraising. Those achievements include a 54-percent increase in radio audience between 2000 and 2004. Board treasurer Robert Auritt commented that "based on the board's conducting third-party national compensation studies, we feel his salary is appropriate given his level of achievement for our organization."

Still, Kirk isn't satisfied. "It's difficult when they say there's no money left and you see the raises that are being handed out," he says, blaming the deterioration of the relationship between union and management on the board of directors. Then again, he adds, "Marrazzo is always welcome to decline his raises."