Talk about a case of the Mondays.
It was a double dose for Friends of Hemming Park.
First came the news that Mayor Lenny Curry’s budget for 2016-17 included only half of the $500,000 the nonprofit was seeking.
Then came a City Council committee meeting where the Friends again were hammered for how it has spent $1 million in taxpayer dollars.
The latter came in the Neighborhood, Community Investments & Services Committee where the results of the council auditor’s examination of the nonprofit were shared.
It mirrored a July 11 Daily Record story that chronicled the Friends’ financial struggles since it began managing the Downtown park in September 2014.
More than $9,400 in meals, including $1,500 for staff events. Almost $1,000 to build a stage for a 45-minute news conference. Over $1,500 for office snacks. A 3.5 percent raise and $1,500 bonus in December for the struggling group’s CEO.
Committee member Joyce Morgan asked if the Friends could have meetings at the office instead of over meals.
“You can’t do this when city services are being reduced,” she said.
‘Interesting’ expenses
The report included a 13-page attachment listing expenses council Auditor Kirk Sherman wanted council members to see so they could decide if they want public dollars spent in those ways.
The list included nearly 200 meals and dozens of snack purchases, a $1,200 drone to capture park attendance and operations, and $950 for All Access passes to One Spark 2015.
Auditors broke down expenses from Oct. 1, 2014-Sept. 30, 2015 to determine how money is being spent.
The largest percentage (44.54 percent) went to contracted services, such as Downtown Vision for ambassadors and to musicians for the café and park events. Payroll and benefits accounted for 23.15 percent.
After the meeting, Sherman called the expenses outlined in the 13 pages “interesting.”
He also cited Friends’ business-related shopping trip to Ikea in Orlando.
“It seemed a little unique going on a trip out of town to purchase basic office furniture,” he said.
Sherman said the nonprofit has a cash flow problem.
“They probably have throughout their life,” he said, “which is kind of the nature of the business to some extent.”
The audit report said the nonprofit, whose monthly expenses are $65,000-$70,000, was insolvent at the end of May. The group received $100,000 from the city in June.
Sherman expressed concern about the nonprofit using nearly $75,000 from a grant targeted for a restaurant in the park to pay operating costs when money ran short.
If council approves a pending $150,000 allocation to get the Friends through the end of the fiscal year, half of that will be needed to replenish the grant funds.
The audit report had several recommendations for Friends, including having separate bank accounts for public and private dollars; revising its chart of accounts; and seeing if the city can provide some services (pest control, cleaning and internet) at a lower cost.
Vince Cavin, CEO of Friends, said he believes the nonprofit can follow all of the suggestions. “I think they’re prudent recommendations that make a lot of sense,” he said.
Mayor not satisfied
Cavin and Friends board members Wayne Wood and Bill Prescott were hoping the mayor would follow the recommendation of his budget review committee. That group penciled in $250,000, plus another $250,000 if the nonprofit raised that amount.
Wood said the fact that Curry included $250,000 shows the work that Friends has done is appreciated. (Curry’s plan calls for the money to be disbursed in monthly installments.)
“Even City Council members have said what a great change we’ve been able to make,” Wood said.
After his budget presentation, Curry acknowledged progress has been made at the park that he wants to be a “jewel of Downtown.”
But, the mayor added, “I’m not satisfied with where we are right now.”
Wood said the group is committed to making the park better. He said the Friends team is “young, they made some mistakes and some expenses were unwise and not well documented.”
He said after a year and a half, “we have finally figured out what we need to do.”
Wood said if the group only gets $250,000 it would essentially turn Friends into a fundraising organization instead of one that programs the park.
“Just purely to manage the park takes more than a quarter of a million dollars,” he said.
Cavin said the group is making changes “to reduce every expenditure that we have.”
The nonprofit has four salaried employees and wants to add a development director who can raise money, write grants and cultivate donors.
“We haven’t talked about layoffs directly, but nothing is off the table,” Cavin said.
He said there are two events in the next few weeks that should raise money for the park. Saturday's Great Foodini event should gross $3,000-$5,000, he said.
One of the park's "signature events," the Hemming Park Beer Festival, should gross $10,000-$13,000. Cavin said he expected expenses to be "fairly minimal" on the beer festival because of in-kind contributions and partnerships.
Prescott said he hopes council members will remember the pending $150,000 was approved as part of this year’s budget and not intertwine it with the $250,000 in Curry’s budget for next year.
Will it be enough?
Council President Lori Boyer said a special council committee will make a recommendation on the pending $150,000 and what should be in next year’s budget.
She said it’s not likely council will find money to give Friends the full $500,000. If additional revenue isn’t found or an expenditure wasn’t double counted, that would require taking money from another item.
“You’d have to rob Peter to pay Paul,” she said.
Boyer said she is concerned by what seems to be a declining level of maintenance and activity in the park over the last few weeks. That may be tied to funding issues, she said.
“If that’s the case, my caution would be if we were to reduce to ($250,000), what is that level of service we are going to get?” she asked.
If council doesn’t increase the $250,000, Prescott said the board would have to “take a hard look” at whether it makes sense for Friends to continue managing the park.
Boyer said the last she heard was Friends couldn’t operate the park on $250,000. If that amount holds true through the end of the budget discussions, council will have to evaluate how to handle it in the coming year.
Possibilities include the city’s Parks and Recreation Department or Downtown Vision Inc., she said.
Wood believes Friends of Hemming Park is the right choice to continue to run the venue, with the proper funding.
“We are possibly one of the few groups on earth that can possibly do it,” he said.
@editormarilyn
(904) 356-2466