County May Hold Onto Tax
At the end of Wednesday’s Warren County Commissioners’ meeting, Commissioner John Bortz offered his reasonings for changing the way the county handles the bed tax. While he didn’t make any motions, he asked the other commissioner to consider a carrot and stick proposal.
He began by saying, “At the last board meeting we had two guests present that were characterizing the Warren County Commissioners’ actions relative to the redesignation of the Warren County Visitors Bureau in a less than flattering light. I felt also that the information that was being portrayed, the questions that were being asked and the way they were being asked questioned the integrity of the Warren County Commissioners relative to our process.”
“While it may have come upon the public suddenly, it certainly was not anything of a sudden nature to the Warren County Commissioners. I would say the process became formalized in January 2012,” he said.
He noted that when Stephen Vanco first took office that he, as chairman, wanted a closer relationship between the WCVB and the Warren County Chamber of Business and Industry “in an effort to find, if nothing else, administrative efficiency. It makes no sense to have two sets of books.”
Bortz said a letter was sent to both organizations in March of 2012 with a list of items the commissioners were requesting. “Top among those lists was their (WCVB) financial reports and their financial procedures, and any audits that were performed. Also we wanted to have a history of their board meetings. We were trying to drive accountability into the process.”
He said that even prior to Vanco’s election that he and Commissioner John Eggleston had a number of concerns about the Visitors Bureau operations.
“I was the sitting representative of the Warren County Commissioners on the tourist promotion agency board,” Bortz said. “At a meeting subsequent to our letter, I was asked to be removed from the board. Their reasoning? They said I was not attending board meetings. Let’s just go down that road a little bit.
“I have emails in my office which substantiate that over a two-year period of time prior to their asking me to be removed from the board, upwards of 20 some meetings were scheduled. Virtually all of them were either rescheduled, canceled, or lacked a sufficient quorum to conduct business.
“So yes, I may not have been in attendance at those meetings, but it was very difficult for me to maintain my schedule with regard to their fluid schedule. If you would like the background on that, I have a stack of emails.”
He said the commissioners had also requested financial information. In the last ten years, the bed tax has generated more than $1 million in revenues.
“Surely, with that amount of money, you should be keeping good books, sound books that are audited,” Bortz said. “What we found was their books lacked generally accepted structure and they failed to perform audits in a timely manner, if at all.”
“So we’re lacking board meetings. We’re lacking the financial structure,” he continued. “How about their operations? Are they getting stuff done? I sat on the board for many years, and I can tell you as recently as the last couple of years, they were having a difficult time, I dare use the word disorganized in their approach to creating their annual image book.
“At the one time their image book… was published in excess of tens of thousands of these books telling the people that they were getting advertising dollars from that they would be distributing them in a timely manner.
“The books were never distributed. They sat in their warehouse, and they were destroyed. Because they (the board) weren’t operating effectively or efficiently.
“And furthermore, I am not aware of any formally adopted and implemented strategic planning process or document which could be submitted to the public for consideration saying, ‘This is what we do and this is how we do it and this is the accountability matrix which measures our performance’.”
He said the commissioners are not asking for much, just a description of what the WCVB is doing. “Any other standard that any other public agency is involved with,” Bortz said.
“These were some of the items that led the Warren County Commissioners to the point where we wanted to change the designation of the agency,” he continued. “While the Warren County Commissioners are the ones responsible for maintaining the designation, we must have concurrence from the municipalities. But at the end of the day, we still find ourselves being in a responsible position where potentially hundreds of thousands of dollars are being funneled to an agency with virtually no set structure or audited books.
“So we’re waiting, I suppose, for concurrence for moving the designation. whether that movement is successful or not. If it is successful, we will be moving it to an organization which has proven that it keeps sound books that adhere to generally accepted practices, and they’re audited. That fixes the problem.”
Bortz said that if they are not successful in convincing a majority of the communities to move the designation, then, “We find ourselves putting money into an organization which isn’t keeping its books soundly or doing audits.”
He continued, “So this is what I am proposing. After 12-31 (Dec. 31), regardless of where we stand with regard to the municipalities’ involvement, I am proposing that we escrow any monies that would normally go toward the tourist promotion agency, until such time that they perform their audits and fall into what I would consider full compliance with how their financials should be kept.
“Public dollars are being used by an agency that is not responsibly using those dollars, and as such, we as commissioners have the responsibility to use every available legal means within our authority to prevent those dollars going any further,” he concluded.
Eggleston said, ” I’ll have to think about what you’re proposing. I’d be willing to probably go along with it, if they can’t produce statements, which they have not, for whatever number of years. But it takes a while to get an audit done and I’d like to have one for not only 2013, but for 2012, 2011, 2010. I don’t remember when we got one, and when we asked for one in 2012, we still don’t have any audited statement. Why does it take that long? It’s not that complicated.
“You keep saying that this is the commissioners’ responsibility. But all we can do is ask. Are we expected to send the sheriff down there and say we’re going to padlock your door until we get your statements?
“One of the things they’ve been criticizing us for is the way we handled this, and as you said, two years ago when we met with them and said, look we need your financials. And that is when they discovered, lo and behold, we’ve got bills in the drawers we don’t even know about that haven’t been paid, where’s the money that’s going, and yada yada yada yada, and so here we are.”
“I’ll think about it, and I assume you’re not making a motion,” Eggleston said.
Bortz replied, “No, I’m not. I’m just putting it out there for our consideration.”
Eggleston said, “I think you make a lot of excellent points, but in fairness to them, it takes a while to get the current year’s audit done.”
County Financial Director Toby Rohlin said, “There’s a provision in the county code that requires annual audits of this particular agency. Now it doesn’t say in the county code, if they don’t give you the audit, what happens but it’s required. It’s the law. Every year, an audit.”
Vanco said, “The visitors center has never acknowledged that these are tax dollars, county tax dollars. They keep saying we have not gotten one dollar of tax money from the county. The county put the (bed tax) ordinance in, the county collects it and the county distributes it. They are county tax dollars.”
Bortz added, “We have it within our authority to de-establish the ordinance we could defunct the ordinance. It begins and ends with this. Keep good books. Keep good books. It’s a matter of public trust. When the public comes knocking, they have a right to know.”
Eggleston added, “Show me some metrics that you are actually accomplishing something. They say, ‘We advertise outside of Warren County, so there’s no way to measure this. The bed tax has gone up, there was a big spike in people staying in hotels’.”
“Guess what, there was a big spike in our fees from our Register and Recorder’s office and our assessment office because we had all these people in here for oil and gas. It wasn’t from tourism,” he continued. “Go out to our parking lot and see the Ferrari from Montana or Illinois or wherever.
“They’re not here to see the Kinzua Dam, they’re (here) looking to make a deal in the oil business. Other than that, you take those spikes out, and that tax has remained relatively flat.”