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After the Coeur d’Alene City Council meeting on Tuesday night, we should all receive a nice note from Steve Wetzel, Dick Barclay, Ron Ouren, and Steve Flerchinger thanking us for contributing to their favorite public charity. You may not have known you were making a charitable contribution, and that’s exactly the way our Mayor and City Council wants it. |
Coeur d’Alene Parks Director Doug Eastwood is proposing the City Council donate $7,500 annually in public money to a public charity of the City’s choosing. Here’s how it’s going to happen.
The agenda for the Coeur d’Alene City Council meeting on Tuesday, December 2, 2008, has this item in the Consent Calender:
4. Approval for the Miscellaneous Allocations of Parks Capital Improvement Funds
The Council’s consent calendar is for routine items. “Being considered routine by the City Council, these items will be enacted by one motion unless requested by a Councilman or a citizen that one or more items be removed for later discussion,” is how the Council explains them. As we have learned over the years, it’s also the place where Council hides items it hopes to avoid explaining in detail to the public. Consent Calendar Item 4 is very likely one of those.
To understand what is in Consent Calendar Item 4, readers should follow this link to the General Services Committee Staff Report dated November 17, 2008, prepared by Parks Director Doug Eastwood. Look at page 38 of 138 in the Council meeting packet. In that Report, Eastwood is asking the General Services Commitee to allocate $30,500 in “miscellaneous revenue” from the Parks Capital Improvement Fund for three purposes. According to Eastwood, “miscellaneous revenue” is not tax dollars. It is:
“… the revenues that are generated within the park system through a variety of sources; park facility rentals, special events, food concessions, etc. We use the miscellaneous revenues to pay for upgrades and/or replacements to our facilities that are not budgeted through the general fund.” [emphasis added]
Eastwood proposes to use $18,000 of the $30,500 for the City’s portion of a 50/50 matching grant to replace “…the failing playground structure at Northshire Park.” Okay, that seems to fit his “upgrades and/or replacements” explanation. No problem there.
Eastwood also proposes to use $5,000 of the $30,500 to install some equipment at the BMX Freestyle Park. Again, that seems to fit the explanation, so no problem there, either.
But snuggled between the two apparently legitimate uses for the miscellaneous revenues is this:
2. Line item allocation to the Coeur d’Alene Parks Foundation.
Eastwood is proposing that the General Services Committee recommend to the Coeur d’Alene City Council that it include a line item in the City’s annual financial plan to allocate $7,500 from miscellaneous revenue to a public charity, the Coeur d’Alene Parks Foundation, Inc. (Foundation).
Understand, please, that the Foundation is not a City department. It is a public charity, a tax-exempt non-profit corporation as defined in section 501(c)(3) of the United States Internal Revenue Code. In that respect it is no different from other public charities such as St. Vincent de Paul, Catholic Charities Corporation, or United Way of Kootenai County.
Also, please understand clearly that while the miscellaneous revenues in the Parks Capital Improvement Fund are not tax-derived, they are still public money.
Again, Coeur d’Alene Parks Director Doug Eastwood is proposing the City Council donate $7,500 annually in public money to a public charity of the City’s choosing.
In his justification for the annual allocation of $7,500 in the City’s financial plan (the amount could vary from year to year, by the way), Eastwood explains:
The CDA Parks Foundation has assisted us with the donations/acquisitions of over $4 million in land since their inception in 2004. They do incur costs on our behalf and have asked for assistance in meeting those costs; letter attached.
What costs? Well, according to the Foundation’s 2006 IRS Form 990, its itemized functional expenses for a total of $898 included insurance, legal, post office box rent, property taxes, and a website. (Incidentally, according to the same Form 990, the Foundation had $2,000 in cash revenue and $658,000 in non-cash revenue.)
This raises a few questions:
- Is donating public money to a public charity, the Foundation in this case, an appropriate use of public money?
- Does this fit within the uses of the miscellaneous revenue in the City’s Capital Improvement Fund as explained by Eastwood (“…to pay for upgrades and/or replacements to our facilities…)?
- Does the Council’s setting that precedent on Tuesday encourage other public charities to start lining up in front of the Council to ask for public money?
I would have thought that these questions would have been raised by Parks & Recreation Commission members when Eastwood pitched this to them. After all, one of the members is City Councilman John Bruning and another is the Kootenai County Assessor Mike McDowell. No, the questions weren’t asked.
I would have thought the questions would have been asked by the General Services Committee members at its November 24, 2008, meeting. Foundation President Steve Wetzel and Vice President Dick Barclay were present. Maybe they were asked there (oddly, the meeting has not yet appeared on CDA TV 19 even though the Public Works Committee meeting on the same day has), but the meeting minutes do not reflect it.
But the minutes of the November 24, 2008, General Services Committee meeting show that Councilmembers Goodlander, Edinger, and Bruning believe the answer to the first two questions is, “Yes.” They voted unanimously to approve a “Line item allocation to the Coeur d’alene Parks Foundation in the amount of $7,500 annually.” That the item is included in the Consent Calendar for the December 2, 2008, Council meeting effectively says the fix is in, and it will pass.
If Council members are challenged at Tuesday’s meeting about this use of public money to annually fund the operational costs of a public charity, it is likely they will say, “But it’s for the parks! How can anyone be against spending money for the parks?”
Remember, it’s not for the parks. It’s to help cover the operating costs (insurance, legal, post office box rent, property taxes, and website) of a charity, the Foundation. It will not be used to upgrade or replace park facilities.
Bill, why doesn’t the Parks Foundation do what all the other charitable organizations have to do: Have a fundraiser. I agree with you that city money should not go to any charitable 501(c)3 group. It’s inappropriate. They are supposed to be separate and independent. Will we next see the Kroc Center 501(c)3 private, church-owned charitable organization line up at the city for help paying their operating expenses? It’s the same thing.
And to hide this improper request in the Consent Calendar is terrible!
Comment by mary — November 28, 2008 @ 9:59 am
I’m not entirely sure the Coeur d’Alene Parks Foundation, Inc., is a good steward of any money, let alone the public’s.
Probably not too many people knew that the Coeur d’Alene Parks Foundation, Inc., file number C151675, a non-profit corporation organized under the laws of the State of Idaho, was administratively dissolved on February 6, 2008, for failure to file the required annual report form by the date due. It had its corporate powers or its right to do business in the State of Idaho reinstated on July 3, 2008, after submitting the application for reinstatement, its delinquent annual report, and a filing fee of $30.00. The filing fee for reinstatement would not have been required if the Foundation had been paying attention to its own administration and filed the annual report on time.
The Idaho Secretary of State makes it very easy for a business to file its annual report. More than a month before the report must be filed, the SoS sends out the notice. The report can be submitted by mail or completed online via the Internet. It takes usually less than 15 minutes.
Comment by Bill — November 28, 2008 @ 11:44 am
Wasn’t it the Parks Foundation that originally received the $3,000,000 of rainy day money for the Kroc Center? If so, then there is already a precedent for this type of transaction. Of course, the Mayor told me the $3,000,000 was for several years of public access to the Kroc Center for events (or something along those lines). So there was a quid-pro-quo. But obviously, money does flow between the City and the non-profit.
Wasn’t the Parks Foundation’s address and contact info at City Hall until a certain member of the public pointed it out?
Smells like fish.
Comment by Dan — November 28, 2008 @ 12:36 pm
In my opinion, the Parks Foundation was established to circumvent the public process. The city happily handed property that was to belong to the people of the city. Non-profit foundations are responsible for fundraising not tax dollar handouts. I am concerned that the rubber stamping of this request will lead to additional forever line items by other foundations such as the Library Foundation, Centennial Trail Foundation, NIC Foundation, St. Vincent’s, etc.. The list could be endless. The principals are certainly aware of fund raising techniques. Perhaps they should utilize those techniques for the foundation they represent.
Comment by Susie Snedaker — November 28, 2008 @ 1:12 pm
Dan,
The Parks Foundation received the City’s (taxpayer) money to purchase the property, then turned the property over to the Salvation Army Kroc Center.
The precedent I was referring to was inserting a line item into the City’s finance plan. That makes the giving to a public charity an annual event subject to review (theoretically). By inserting it into the budget, the City can raise or lower the amount from $7,500 with far less public scrutiny. The likelihood of the public (other than Susie) finding an increase to, say, $10K or $20K is much less once it’s a line item in the City’s budget. It becomes a small needle in a haystack made of large needles.
Susie,
It appears the only reason for the existence of the Parks Foundation is to handle land transactions for the City. As a IR 501(c)(3) it has to make public some of its financial information, but other records are beyond the reach of the public.
I’m pretty sure someone will think if not say, “Oh, it’s only $7,500 each year. Don’t make such a big deal over it.” Anytime a public official uses the adverb “only” in front of a dollar figure, we need to watch out. But in this case, I would turn it around to echo what you suggested: How does it happen that a foundation supposedly trustworthy and skilled enough to handle several million dollars in land transactions can’t even raise less than $3,000 every year for its basic operating expenses such as legal, taxes, website, postal mail box, and insurance?
Comment by Bill — November 28, 2008 @ 2:36 pm
Well, I assume that the Parks Foundation will do much better after they have financial support from the City of Exsellance.
Comment by Dan — November 28, 2008 @ 4:50 pm
It’s Saturday morning, and I see that at least according to the CDA TV 19 online schedule, the General Services Committee meeting of November 24, 2008, isn’t being televised.
I wonder why?
Maybe it was some kind of “technical problem”.
Comment by Bill — November 29, 2008 @ 7:04 am
Mike Kennedy cast the only dissenting vote on this issue. I believe he could foresee conflicts on this issue. Unfortunately, the mayor justifies doling tax dollars to non-profits as simply acceptable as the end justifies the means. In the case of the LID on Fourth Street, Don Thompson’s request that the LCDC fund all of the improvements adjacent to properties. The basis for his request was because all properties are located within the URD and a goodly portion of their taxes are given to LCDC and will be for many, many years. LCDC will recoup the investment many times over. It made sense to me but, unfortunately, not to the mayor or council. On another note, Deanna, asked the public to donate to the Salvation Army Ray and Joan Kroc Center wall.
Comment by Susie Snedaker — December 2, 2008 @ 10:29 pm
Susie,
I watched it on TV. Remember, Kennedy said he had been trying unsuccessfully to do the same thing for one of his favorite charities. His conflict is that he hasn’t been allowed to shuffle public money to his favorite private charity (yet). He will be allowed.
Please tell me that they’re not going to put donor’s names up on the Kroc Center wall. With all the inscribed names, the Coeur d’Alene City Library reminds me more of a columbarium than a library. But, at least with this donation the public can make up their own minds.
Comment by Bill — December 3, 2008 @ 6:33 am
You are correct, Bill. I see charitable requests coming toward the trough as we speak. I thought Doug’s reasoning without merit. I still think that the many non-profits have the responsibility to fund raise. On another note, I think the $200 charge to appeal a design review decision to be a thinly veiled effort to thwart the public. Mark Hinshaw’s proposal was the first phase to discourage and eliminate any appeals. Now about the wall: I wonder if it will be located in the chapel. I think the names in the library to be truly tacky. A simple bronze wall with names would have been adequate.
Comment by Susie Snedaker — December 3, 2008 @ 7:32 am
I agree with you that the wall in the library is tacky and is especially poor as a backdrop to the speaker’s podium. It is too busy and distracting to have behind as someone is testifying to council.
That said, if there is to be a donor’s wall at the new Kroc Center, I hope that right smack dab in the middle of it is a HUGE plaque thanking the TAXPAYERS OF COEUR d’ALENE for the $3.5 million dollar “donation” for which we had absolutely no input.
Comment by mary — December 3, 2008 @ 8:55 am
When I return from vacation, I will begin work on my request to the city for partial funding of my favorite charity. For many of the smaller non-profits here in Kootenai County, this $7,500 would be a large part of their annual budget. In this challenging donor environment, many organizations that traditionally fund non-profits such as foundations have simply stopped funding operating expenses. Special projects with immediate measureable outcomes are key items for these groups. How many hungry people could be fed for $7500? How many families could be sheltered from the elements during this holiday season for $7500? Food and shelter are needs of survival and are real issues for many in Coeur d’Alene. I think that I will ask for $10,000. I am hoping to find how much will fly under the radar without being noticed. The range currently is from $7500 to $3.5 million. I respect the efforts of many of the charities in Kootenai County and I believe that forced donations make their fundraising effort more difficult.
Comment by doubleseetripleeye — December 3, 2008 @ 10:28 am