Attorney says KOCE deal done properly

Marisa O’Neil

Coast Community College District officials say they are confident an

issue that could have sent KOCE-TV back to the auction block has been

resolved.

Milford Dahl, who represents the district, said that, contrary to

discussions in court earlier this week, his client did give public

notice of its sale of KOCE-TV, as required by the state education

code. He will present evidence to that effect when a hearing to

determine the rightful buyer continues on Monday.

“In my opinion, we gave proper notice when we started the process

in 2002,” Dahl said. “The statute doesn’t say you have to give notice

every time you start the process.”

Regardless if proper notice was given, spurned bidder Daystar

Television Network is still asking a judge to rule that it, not the

KOCE-TV Foundation, can buy the station.

“It doesn’t ultimately change anything,” said Daystar spokeswoman

Meg Waters. “Notice was not the basis for the lawsuit.”

If Judge Corey Cramin, who is hearing the case, had found proper

notice was not given, that oversight could have temporarily foiled

the Christian broadcaster’s hope to buy the station. Lack of notice

would open the door for the judge to call for a rebid of the station,

rather than declaring Daystar as the highest responsible bidder, as

they are asking him to do.

According to the education code, school districts may sell

property “for cash” to the “highest responsible bidder.”

Daystar officials are asking Cramin to rule that their

$25.1-million cash bid should have been selected over the

foundation’s offer of $28 million via a long-term note.

But Cramin questioned the sale process, not brought up by

Daystar’s attorney, and wondered if proper public notice had been

given. The education code requires public notice in at least three

locations for two weeks before the proposed sale.

He postponed the remainder of the hearing to next Monday to give

the attorneys time to produce the evidence Dahl said he now has.

The district gave notice in May of 2002 at its three campuses --

Coastline, Orange Coast and Golden West colleges, Dahl said. He is

submitting copies of the notice to the court for the hearing.

Though the sale process stalled in 2002, Dahl said he believes it

was not necessary to issue new notice when it continued the next

year.

Evidence includes agendas from district board of trustee meetings

that discussed the station’s sale.

“I think the judge was concerned this was done behind closed

doors,” Dahl said. “This will show that’s not the case.”

District trustee George Brown also is seeking to quell another of

the judge’s fears. Cramin wondered what recourse the district -- and

by extension the state -- would have if the foundation, which is

financing the deal, defaulted on their loan.

No liens can be placed on broadcast licenses, the most valuable

part of a station. KOCE-TV’s license is valued at approximately $20

million.

But language in the deal gives the district some recourse, Brown

said. If the foundation resells the station within 10 years, the

district gets all the proceeds and if it is sold later, the district

will still be paid on a sliding scale.

* MARISA O’NEIL covers education. She may be reached at (949)

574-4268 or by e-mail at marisa.oneil@latimes.com.