Director denies misuse of funds in art program Audit: Money spent elsewhere

Dolores Tropiano The Arizona Republic Apr. 5, 2006 12:00 AM

SCOTTSDALE - The director of Scottsdale's award-winning Public Art Program denies that any funds in her program were misused, following a city audit that documents questionable spending.

Taxpayer money targeted for the purchase of public art was instead used for personal meals, travel, salaries, equipment and other expenses, the audit shows.

Scottsdale's Public Art Program has brought pieces such as Robert Indiana's LOVE sculpture and bas reliefs along Loop 101 and is also responsible for maintaining the city's art collection.

Valerie Vadala Homer, director of the Public Art Program, called the audit "a valuable, educational experience" but denied that any wrongdoing took place, saying "without hesitation, there has been no misuse of funds."

Homer said the key issue is the appropriateness of the funding source used and contradictions in spending authority between the city's public art ordinance and the master agreement of the Scottsdale Cultural Council, which manages the city's arts programs.

"The funds were used for expenses related to the accession of artwork, staff salaries and conservation and restoration," Homer said.

According to the audit:

During fiscal 2004-05, nearly $570,000 was spent on salaries, maintenance of artwork, equipment, travel, subscriptions and meals and, therefore, "reduced the pool of funds available for the purchase of artwork."

Certain travel expenditures charged to the Public Art Program did not appear necessary or cost-effective.

The Public Art Program staff expensed its personal cellphones to the program without documenting that the use was business related.

In fiscal 2004-05, nearly $614,000 was provided to the Cultural Council in a lump-sum payment for costs related to administer the Public Art Program. However, Michelle Korf, the city contract administrator, did not monitor distributions.

Corporate-issued credit cards were used with little or no accountability or policies.

The report says: "Cultural Council management questioned the materiality of individual findings and whether or not they were significant enough to warrant disclosure in the audit report."

City auditors contend there was more than enough in the report to warrant disclosure and to make management concerned about doing so.

The audit indicated that the Cultural Council did not have any written policy regarding the use of funds for in-town food and beverages, no policy requiring detailed receipts for such purchases and no policy regarding the use of public funds for alcohol.

Moreover, from the limited expenditure documentation available, expenses charged to the program included:

Staff-appreciation lunches and lunch meetings.

Lunches between the Public Art Program staff and Michelle Korf, the city's contract administrator.

Multiple expenditures ranging from $3 to more than $60 identified as "company meetings" with no names or business purpose stated.

"We have taken steps to improve documentation methods, record-keeping and strengthen polices and procedures as suggested in the audit," Homer said.

The audit recommended improvements in city oversight to adequately safeguard public funds. The improvements were outlined in an action plan within the audit that included a requirement for zero-based budgeting and adequate documentation.

Cultural Council expenditures charged to the Public Art Program will be periodically and randomly monitored to ensure that sufficient documentation is available, the audit said.

A version of this story may have appeared in your community section or your community Republic.

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