More than a year ago, the Friends of Hemming Park board talked about the nonprofit’s dire financial situation.
Treasurer Bill Prescott said in May 2015 cash was “precariously low,” with only $14,000 on hand, according to minutes from the meeting.
Friends received $150,000 from the city the next month that could address the immediate crisis. In July, though, the executive director had to loan the group $7,000 to make payroll.
Prescott’s May report included another bit of tough financial news: Revenue would run out in February 2016, a month after receiving the final payment in the $1 million contract with the city.
At that point, Prescott said, Friends would “no longer be sustainable.”
The message was even stronger this May, when Friends said it would have to close if City Council did not transfer $250,000 that had been set-aside for the remainder of the fiscal year.
That revelation drew the ire of council members, who agreed to give the nonprofit $100,000 of that money as a stop-gap.
Many were frustrated by what they saw as a lack of communication.
Not just about the money needed to make it through the fiscal year, but the group’s push for $500,000 a year to continue running the park.
There’s also a trust issue with some city officials over how Friends has spent taxpayer dollars and a belief the nonprofit hasn’t been up-front about when it could become self-sustaining.
From October 2014, when it received its first injection of public dollars, through May 2016, Friends spent more money than it brought in every month except the six months it received a taxpayer subsidy, ranging from $100,000 to $300,000.
Without city funding, Friends raised enough money only one month during that period to support itself.
Most of the group’s 24 so-called “signature events” from March 2015 through May of this year lost money at a more than two-to-one pace.
The most profitable was Bourbon & BBQ in April, which brought in $9,042.62; the biggest loss was $18,273.20 for Pogopalooza in June 2015. Two other events lost more than $12,000 each.
Council auditors are studying the group’s finances, with the report expected this month. It will be used by council to evaluate further funding for Friends, which received $100,000 of the $250,000 it had been seeking.
Also being scrutinized is the contract with Friends, which met the three requirements, including for private fundraising and events that attracted more than 500 people.
But the contract set no parameters for how Friends could spend public funding, nor did it prohibit commingling taxpayer dollars with private funds. As a result, it’s not clear how taxpayer dollars were used.
Expenses drawing early criticism from officials include:
• Nearly $25,000 for musicians, mostly for lunchtime performances, when early discussions included trying to build a level of free entertainment
• At least $9,200 in meals, such as for marketing and team dinners, many with incomplete information on receipts
• Nearly $1,000 to build a stage for a 45-minute news conference in City Hall announcing Pogopalooza, featuring performers who later continued their acrobatics outside in the park
• $950 for 10 All Access One Spark 2015 passes for employees and contractors
• $842.71 for an 18 percent late fee to an architectural firm
• $500 for funeral expenses to the family of a murdered staff member
Expenses like those and others didn't sit well with some council members.
"I think they've been running fast and loose with the money that they received," said Bill Gulliford, one of the architects of the deal with Friends.
Most agree Hemming Park looks better and many say the programming has been effective in attracting more people.
There’s also wide support for a planned restaurant from the owners of Black Sheep.
But without the city giving Friends more money, the restaurant project may not happen.
When money got tight, Prescott said Friends used about $76,000 of a $100,000 grant from Project for Public Spaces to cover operating expenses. That money was targeted by PPS for Black Sheep.
Prescott said PPS was fine with Friends using the money as long as it’s paid back so the restaurant comes to fruition.
The nonprofit needs the remaining $150,000 not only for operations, Prescott said, but also to replenish the PPS fund and build the restaurant.
Realizing mistakes were made
Council auditors spent the better part of June poring over Friends’ financial records.
Executive Director Vince Cavin, Prescott and Wayne Wood, president of the Friends board, acknowledge mistakes were made by the nonprofit.
Some through growing pains, others through bad decisions.
Cavin said the expenses for meals were approved by the former operations manager, often without requiring documentation for specific information, such as who attended.
As a result Cavin had to dig through two bins of receipts to find them for council auditors, then try to track down other information.
Cavin said Wood put an end to the nonprofit paying for those meals and for healthy snacks for employees, which it had been since almost the beginning.
“Wayne made it very clear if the secretary at (the city) is not getting snacks and food, we should not be either,” he said. “I get that.”
Cavin said he had asked the operations manager to place a small order for Hemming Park shirts for customers. Instead, he placed a larger order of shirts for staff.
“It was probably 300 or something crazy,” Cavin said of the more than $3,000 expense.
The shirts had “staff” on them so they weren’t a big draw for resale and they couldn’t be returned.
“I got burned on that one,” Cavin said. “I’ve got like 10 in my closet.”
That same operations manager ordered a $1,000 sink and approved other expenses, such as paying for several parking tickets for musicians and others.
Though the operations manager made those mistakes and consistently committed errors while handling the books, he remained on the job for more than a year before being let go in April mostly in a cost-cutting measure.
After the story published, Cavin said the accountability for the spending lies with him and "not with an employee that was following the budgets, directives, and expectations set by me."
He also defended paying the musicians during lunchtime and at other events, saying the park didn’t want to affect an entertainer’s livelihood.
“Every time we don’t pay an artist, there’s a huge outcry from the creative community,” Cavin said.
Gulliford disagreed, saying Hemming Park could be touted as a marketing venue for musicians to get exposure.
Let them set up a tip jar and marketing materials, he said. They’d probably get enough to cover the day’s expenses and get a gig or two out of it.
Adding a strong mix of free performances to the lineup could save thousands of dollars a year.
“That’s being prudent and imaginative,” he said.
Others mentioned featuring student performances, such as from the LaVilla School of the Arts or Douglas Anderson School of the Arts.
Council President Lori Boyer was bothered by the nonprofit’s failure to add unpaid musicians to the lineup.
“There are a number of attitudes and things I hear being expressed that maybe are not the best fit for a public facility,” she said.
Mind-set about public money
Council member John Crescimbeni had concerns about the steps Friends took — or didn’t take — for the park’s proposed stage.
The kit to build the stage was about $120,000 and the organization got a $130,000 quote from the one contractor it talked with to assemble it.
“I looked at them and said ‘one?’” he recalled asking Wood and Cavin. “And they kind of looked at me like, ‘Yeah, what’s wrong with that?’”
He was further concerned the group hadn’t reached out to civic-minded contractors who might build the stage at a discount or for free. “They were like, ‘Why would we do that?’”
Crescimbeni gave them the name of Summit Contracting Group, whose owners serve on the Downtown Investment Authority board of directors and the Planning Commission.
The company agreed to do the labor for free and provide any additional materials for the stage, he said.
Crescimbeni then asked if Friends only needed $120,000 now instead of $250,000.
“They were like, ‘No, no, no. We still need the $250,000,’” he said, to pay for “some other stuff we couldn’t get before.”
Those encounters make him believe there is no mind-set at Friends about trying to save taxpayer dollars, he said.
“I don’t think that’s something that can be instilled in those people,” he said. “It’s either part of their DNA or it’s not.”
Instances like that, plus using public money to pay for parking tickets, lunches and nearly $1,000 for One Spark All Access passes concerned Crescimbeni.
But even if they used their own money for those expenses, that would still bother him.
“That comes with a footnote in my book. A little asterisk,” he said. “If they’re wasting their own money, which causes them to need money from the city, I have a problem with that as well.”
He thinks the Friends board needs to start focusing on raising unrestricted cash. But that hasn’t always been easy.
Uncertainty affects fundraising?
Prescott said after getting the contract in September 2014 and building the nonprofit’s staff, “You kind of hit the holidays and the weather. It’s probably not conducive” to raising money.
Plus, companies wanted to see what the new entity was going to do before linking their brand to Friends.
When the media covered stories about whether earlier donations should count toward the nonprofit’s fundraising requirement, as well as concessions, it caused some concern.
Prescott said donors were asking, “Well, are you guys even going to be around?”
He even decided against meeting with Delores Barr Weaver, whom he worked for at the Jacksonville Jaguars, because he didn’t feel comfortable asking for donations at the time.
Cavin said he canceled a planned spring fundraiser for the Kids Zone because of the uncertainty of the group’s future.
But he is close to a $300,000 in-kind deal over five years with Center Stage Events and Southern Sound and Lighting to help with expensive event set-up and supplies.
Cavin knows a lot of events lost money but his strategy moving forward is all programming and events will require sponsors.
He praised Wood and Prescott for bringing in donations, but wished the other board members had been more successful. Some changes in the board makeup could help that, he said.
Wood said it would be helpful if the city would publicly praise the nonprofit’s work. ”I would like the city to acknowledge we have done a remarkable renaissance,” he said.
He’s disappointed more people didn’t rally around the group and help raise money for the historic park.
Cavin would like to get some sort of funding commitment from the city for the remaining three years on the contract.
Until then, “I think it would be unfair to any donor for us to ask them for money when the future’s uncertain for Hemming Park,” he said.
Friends’ future in the balance
One thing that is fairly certain is the contract will be amended.
There’s no question Friends met the terms of the contract.
But the vaguely written contract did not put stipulations on how taxpayer dollars could be spent, nor did it prohibit public money and private dollars from being commingled. (There are specifics attached to how the $100,000 released last month can be used.)
As a result, it’s difficult to tell how taxpayer dollars — which account for 69 percent of Friends’ money — were spent.
Friends and city officials agree keeping separate accounts for public and private funds, and identifying how the public dollars can be spent are good ideas.
Mayor Lenny Curry’s administration is putting together his budget proposal scheduled to be presented July 18. His budget review committee supported $250,000 up front for Friends, followed by another $250,000 when the nonprofit raises that same amount.
That will likely face tough scrutiny in council, which has final say on funding. Boyer has set up a Hemming Park committee chaired by Greg Anderson, her predecessor as council president.
“It’s going to be a challenging six or eight weeks on that to figure it out,” she said.
Boyer said "there's no way the city is in a position" to afford $500,000 for the Downtown park.
"Is the city even willing to go to $250,000 with Friends of Hemming Park as the operator?" she asked.
The council auditor is scheduled to meet with Friends on Thursday to talk about the findings. Those results will likely drive what council decides.
Boyer and others acknowledge the park has improved under Friends, particularly in how it looks.
There are still concerns about some of the behavior that occurs there, such as cursing, and the “congregators” as Gulliford calls them.
Curry’s spokeswoman Marsha Oliver said the administration is seeking greater clarity of the needs and goals for the park.
She expects the audit results to “provide a comprehensive review of any financial threats and opportunities that may impact Hemming Park’s future.”
Boyer had envisioned using a reinvented Hemming as a recruiting tool for Downtown, but it hasn’t happened.
She thinks Friends’ programming has been targeted toward a younger urban crowd for night and weekend events instead of for workers Downtown now and ones that could be there one day.
Boyer is concerned about Friends using the PPS grant for administrative costs and wonders what happens if the nonprofit can’t replenish the money.
“If they don’t get the next dollars, then what are they going to do?” she asked.
It’s one of the many questions to be answered.
@editormarilyn
(904) 356-246