Turmoil at agency led legislators to put limits on 2017 spending
By Liz Schevtchuk Armstrong
The Putnam County Visitors’ Bureau lost more than $26,000 in 2015, according to newly released documents — one of two shortfalls totaling nearly $100,000 since 2013 that prompted the Putnam County Legislature to keep most of its 2017 appropriation under tight rein.
According to forms filed with the Internal Revenue Service, the nonprofit bureau last year raised $268,154 and spent $294,232. The agency occupies space in the county government office building in Carmel and is accountable to the legislature but operates as a separate, nonprofit corporation.
The Putnam legislature has released only $41,996 of the $141,996 it budgeted to provide the Visitors’ Bureau in 2017, enough to keep it running for the first quarter, while maintaining the rest under legislative control. Lawmakers cited lingering concerns about the bureau’s finances and management following the resignation in March of Executive Director Libby Pataki after questions arose about a separate tourism nonprofit she established that apparently had no functioning board and prompted an ongoing investigation by the state attorney general.
Restricting the Visitors’ Bureau money ensures “a little more oversight going forward,” explained Ginny Nacerino, who chairs the legislature. “As soon as the issues are cleared up and resolved, we’ll release the money.”
The Pataki years
As an investigation by the Journal News revealed, Pataki, a Garrison resident, created a second, largely unknown nonprofit called Putnam Tourism Corp., for which she solicited tax-deductible donations and which paid her a separate salary from that provided by the Visitors’ Bureau. Now defunct, the Tourism Corp. also ran a deficit of about $14,000 in 2015, according to its IRS filing.
This past summer, the Visitors’ Bureau established a new board of directors, which picked Cold Spring resident Barney Molloy as chair. Frank Smith, who had served as an intern and deputy director in recent years (although not named as an employee in the bureau’s 2014 or 2015 filings), became acting director, while the search for a permanent director continues.
On a form filed with New York state that is required of all charities, the Visitors’ Bureau stated that in 2015 its revenue included a $146,996 grant from Putnam County and $53,911 from the state’s Empire State Development Corp., which the county matched with another $53,911.
Visitors’ Bureau expenses included salaries for Pataki and Katie DeMarco, who lives in Philipstown. Pataki earned $43,087 for working full-time as director, far less than the $70,000 she received in 2014. However, she spent part of 2015 on leave when her husband, former New York Gov. George Pataki, campaigned for the Republican nomination for president. DeMarco earned $36,600 for working 20 hours a week.
Top Secret: Putnam County Tourism
By Chip Rowe
While preparing a story on the newly appointed board of the Putnam County Visitors’ Bureau and each member’s background and experience (Meet Your Tourism Board, Sept. 30), The Current filed Freedom of Information Law requests to receive copies of the applications the agency received for the volunteer positions, meeting minutes, a copy of the bylaws and any emails between Acting Director Frank Smith and board members.
Smith, who acts as the Visitor Bureau’s records officer, replied that the minutes had been posted online (they have since been removed) and that the emails are exempt from public disclosure laws. He noted that an appeal could be filed with … the Visitors’ Bureau board.
The bureau did honor the request for the applications, provided with “personal and contact information removed.” Samples appear below.
At the same time, Pataki’s Putnam Tourism Corp. paid DeMarco $50,000 for working 24 hours a week as its vice chair. (The previous year, 2014, DeMarco earned $24,000 for 20 hours per week in the same position.) Pataki received no salary in 2015 from the corporation, which was dissolved this year in the wake of the attorney general’s investigation. The nonprofit took in $72,580 in donations in 2015, spent $1,268 on promotions and gave grants of $21,597, according to its IRS filing.
Meanwhile, the Visitors’ Bureau provided grants in 2015 to the New York-New Jersey Trail Conference ($2,000), the Cold Spring Merchants Association ($700), the Putnam County Joint Veterans Council Row of Honor Flags ($100) and Beatrice Copeland, daughter of then-board member Carolyn Copeland, for a film project ($500).
Its expenses in 2015 included about $95,000 for tourism advertising, $7,000 for events, $4,000 for public relations and $14,000 for its website and mobile app.
Federal filings show that in 2014 the Visitors’ Bureau ended the year with a positive balance of $25,767 in revenue over expenses; in 2012 with a positive balance of $2,872; and in 2013 with a $70,930 deficit.
At an Oct. 20 meeting, Legislator Dini LoBue referred to the 2013 and 2015 shortfalls and asked Smith for the agency’s 2016 records, including bank statements. Smith replied that while he signed Visitors’ Bureau checks, he did not have bank statements. He likewise declined to discuss files that Pataki may have left, saying he would have to review them individually before sharing them with legislators.
Nonetheless, Smith assured legislators that he was “doing my absolute best” to straighten everything out. “I apologize if there is anything from the past,” he added. “But I don’t know how I can answer for that.”
Several legislators commended Smith for his efforts. With LoBue the sole dissenter, the legislature voted 8 to 1 to release all of the bureau’s 2017 funding.
A week later, it changed its mind.
During the Oct. 27 meeting, LoBue urged her fellow legislators to retain tight control over the entire $141,996 appropriation. Citing the investigation by the Attorney General’s Office, she maintained that “we have to keep a close watch on this agency.” She said Smith earned $50,000 for “a part-time position” and that between state and county funding, the bureau receives about $400,000 annually.
“That is a lot of money for the acting director to not know where the bank statements are, to say he signed checks but now he’s not familiar with what’s in the bank,” LoBue argued.
The legislators voted 7 to 2 to approve a compromise: Holding back $100,000 but releasing $41,996 for bureau expenses during the first quarter of 2017.
Legislator Barbara Scuccimarra, who represents Philipstown and served as treasurer of the previous Visitors’ Bureau board, voted no, protesting that her colleagues were “tying their hands” at the agency. She said the finances had been inherited by the new board, and “they’ve given every indication they will address the issues. I don’t think it’s fair to put any money away.” (Legislator Carl Albano also voted no.)
After the vote, LoBue continued her quest for Visitors’ Bureau financial data. On Nov. 17, she asked Smith for “detailed costs” of spending for a promotion for “Fireball Run,” a car race-cum-scavenger-hunt that stopped in Mahopac on Sept. 30 and Oct. 1.
On Dec. 13, she told The Current that “even after countless letters,” Smith remained “unresponsive to requests to submit financial documents so that I can fulfill my oversight duties as a legislator. Considering the legal problems encountered by the previous bureau administration, I would think that Mr. Smith would make every effort to respond to any and all inquiries promptly and completely in order to regain the confidence that had been lost,” she said.
Smith did not reply to requests for comment on the legislature’s retention of $100,000. However, he said Dec. 12 that the bureau has been “working with New York State and our attorney to revise and update policies.” It also plans new “funding guidelines so that they are consistent and fair to all of our potential partners” and expects to announce its choice of a permanent director after the first of the year.
Board Chair Barney Molloy declined comment, saying in an email on Dec. 21 that he was unavailable until after Christmas. The Attorney General’s Office also did not respond to requests for an update on its inquiry.