Taxpayer grants to local non-profits under scrutiny

BY PRU SOWERS

KONK LIFE STAFF WRITER

Key West non-profit groups perhaps hoping to join the local organizations that share an annual taxpayer-funded pot of $140,000 were disappointed Jan. 5 when city commissioners agreed not to open the annual donation program to new clubs.

But the 11 non-profits currently receiving annual grants will be subjected to increased scrutiny over their financial information to ensure they are spending the money as the grant stipulates. Assistant City Manager Sarah Hannah-Spurlock outlined a new application process for any non-profit to request a piece of the yearly $140,400 city-funded grant pie. The application would require more detailed financial information about a specific organization’s budget, any staff salaries and where the grant money would be spent. It would also require an assessment of the success or failure of the previous year’s grant in helping promote the organization’s mission.

However, city commissioners agreed that they should not open the grant-making process to new organizations because of an overload of groups that may want to apply. And they also rejected a proposal to create a new city board that would evaluate the applications and report back to city staff.

“Do we really want to create another board for $140,400? Is that worth the time and energy of what we want staff to do? I don’t think so at this point,” said Commissioner Sam Kaufman.

“We have 35 boards now,” said Commissioner Billy Wardlow. “Our staff is overworked just going to board meetings.”

Wardlow strongly encouraged Hannah-Spurlock to create a detailed financial application for the 11 non-profits that currently receive taxpayer funds each year. He pointed to some of the sport-related organizations, saying there “were rumors” that some of the sports leagues had hefty bank accounts, including investment CDs.

“And they’re collecting fees out there and we’re still donating money to them. Somewhere down the line there has to be accountability between the [sports] leagues and us and everybody else. We’ve got to have proof of why we’re paying them x-number of dollars,” he said.

Currently, the Lil Conch Baseball league receives $19,400 annually. The Junior Football League receives $18,000 and the Junior Soccer League gets $10,000. The Boys and Girls Club receives $25,000 and Positive Step receives $35,000 to help fund its summer youth program.

Hannah-Spurlock said that while an application process won’t be created until the upcoming 2017 fiscal year – budget planning will begin this summer – all of the grantees are currently required to sign an agreement with the city stating they will provide certain financial information. The sports league grantees have not handed over that financial information yet, she said. The other non-sports grantees such as the Boys and Girls Club and Keys to be the Change, the Monroe County youth and adult wellness program, have.

“I’d like to see it [grant program] stay with these [11 current grantees] but obviously have them fill out the paperwork so we’re comfortable with where they’re spending the taxpayers’ money,” said Mayor Craig Cates.

But Key West Finance Director Mark Finigan pointed out that requiring all the 11 non-profits to audit their books can be a financial burden for the smaller groups. It can cost between $10,000 and $15,000 for an audit, which can be difficult for a group with, say, a $10,000 annual budget.

“You don’t want to have so much oversight that you take away their ability to deliver the primary program services,” Finigan said.

But more financial information, rather than less, is a priority for Commissioner Sam Kaufman.

“It forces the organization to articulate what the benefit is of this money,” he said.

And Commissioner Margaret Romero said she wanted to know if the clubs were staffed by volunteers or paid executives. If there are paid staff positions, “it will sway my decision on funding some of these organizations,” she said.

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