Last Friday afternoon the City-County Observer published “breaking news†of City Attorney Nick Cirignano’s refusal to provide Evansville Brownfield’s past audits to Brownfield transparency crusader George Lumley. We believe that the City Legal Counsel’s refusal to share the records of a non-profit that is wholly funded with public monies is a smoking gun, if ever there is one!
We don’t hold Mr. Cirignano solely responsible for the decision to keep EBC’s audits since 2009 under wraps, though. He has a boss, and that boss, Lloyd Winnecke just won re-election as Mayor of Evansville running on a platform of transparency. There are a lot of reasons to doubt that transparency. Before the election, it was known that the Icemen were considering leaving the city, and the investigation of the use of TARP funds for the relocation of D-Patrick’s downtown lot to the corner of Walnut and Hwy 41 was being dismissed as a routine audit. On top of those examples, we are still are awaiting the overdue publication of the results of the SBOA audit for 2014. Nobody seems to know if former Councilman John Friend  CPA was right about $6,000,000 being unaccounted for, but it is past time for the information to be made public.
We hope that the Mayor will see fit to be accountable to the voters and release information concerning the details of the agreement for the new hockey team that will play at the Ford Center next year, and we hope that he will encourage the SBOA to release the overdue results of the 2014 audit. Even more, we look to him to release the Brownfields audits to George Lumley. If everything is in order, it seems that the Mayor would be anxious to make that information public. It is also disappointing to see that the mainstream media isn’t taking more interest in these issues, as it appears that they have begun to occasionally be critical of our current leadership.
We are asking the Mayor to live up to his pledge of accountability and transparency by releasing the audits requested by Mr, Lumley. We have long been wondering how the Maybelle-Montrose give-away is justified and many of our readers have,too. By releasing audits, Mayor Winnecke can clarify the propriety of the expenditures that many of us have questioned. We are asking our readers to join George Lumley and the City-County Observer to call on the Mayor to live up to his campaign promises of accountability and transparency.
The Mayor won by such a majority that it has reinforced the hubris he already displayed. It is going to take a real catastrophe to put him in touch with the reality that a 62% vote does not make him above the law.
What he needs to consider is that he received 62% of a dismal voter turnout. Most are simply not concerned with voting, and a few as myself suffered electile disfunction. However, public opinion turnout runs nearly 100% and will quickly erode this so called “mandate of the voters” he believes he possesses.
When he started shooting those French Cuffs and sporting those Hollywood sunglasses, we should have known all was lost. As you said, it’ll take an extraordinary set of circumstances (maybe like a rat weasel snitch coming forward?) to bring Lord Winnecke back to earth.
Unaffected, he gallops in full career to the next big thing … a dog park. Says he’s had meetings about it and the people want it. Right. The crusty, whitened, unscooped detritus at Roberts will be an apt metaphor for his administration.
Potential Risks of Public Private Partnerships
There are a number of potential risks associated with Public Private Partnerships:
Development, bidding and ongoing costs in PPP projects are likely to be greater than for traditional government procurement processes – the government should therefore determine whether the greater costs involved are justified. A number of the PPP and implementation units around the world have developed methods for analyzing these costs and looking at Value for Money.
There is a cost attached to debt – While private sector can make it easier to get finance, finance will only be available where the operating cash-flows of the project company are expected to provide a return on investment (i.e., the cost has to be borne either by the customers or the government through subsidies, etc.)
Some projects may be easier to finance than others (if there is proven technology involved and/ or the extent of the private sectors obligations and liability is clearly identifiable), some projects will generate revenue in local currency only (eg water projects) while others (eg ports and airports) will provide currency in dollar or other international currency and so constraints of local finance markets may have less impact
Some projects may be more politically or socially challenging to introduce and implement than others – particularly if there is an existing public sector workforce that fears being transferred to the private sector, if significant tariff increases are required to make the project viable, if there are significant land or resettlement issues, etc.
There is no unlimited risk bearing – private firms (and their lenders) will be cautious about accepting major risks beyond their control, such as exchange rate risks/risk of existing assets. If they bear these risks then their price for the service will reflect this. Private firms will also want to know that the rules of the game are to be respected by government as regards undertakings to increase tariffs/fair regulation, etc. Private sector will also expect a significant level of control over operations if it is to accept significant risks.
Private sector will do what it is paid to do and no more than that – therefore incentives and performance requirements need to be clearly set out in the contract. Focus should be on performance requirements that are out-put based and relatively easy to monitor.
Government responsibility continues – citizens will continue to hold government accountable for quality of utility services. Government will also need to retain sufficient expertise, whether the implementing agency and/ or via a regulatory body, to be able to understand the PPP arrangements, to carry out its own obligations under the PPP agreement and to monitor performance of the private sector and enforce its obligations.
The private sector is likely to have more expertise and after a short time have an advantage in the data relating to the project. It is important to ensure that there are clear and detailed reporting requirements imposed on the private operator to reduce this potential imbalance. A clear legal and regulatory framework is crucial to achieving a sustainable solution.
Given the long-term nature of these projects and the complexity associated, it is difficult to identify all possible contingencies during project development and events and issues may arise that were not anticipated in the documents or by the parties at the time of the contract. It is more likely than not that the parties will need to renegotiate the contract to accommodate these contingencies. It is also possible that some of the projects may fail or may be terminated prior to the projected term of the project, for a number of reasons including changes in government policy, failure by the private operator or the government to perform their obligations or indeed due to external circumstances such as force majeure. While some of these issues will be able to be addressed in the PPP agreement, it is likely that some of them will need to be managed during the course of the project.
‘… it is difficult to identify all possible contingencies … events and issues may arise that were not anticipated … at the time of the contract. It is more likely than not that the parties will need to renegotiate the contract to accommodate these contingencies.’
Slightly paraphrased from yesterday:
‘ … who wish to draw the (executive) into a corner and make whispered arrangements which they dare not have known by their constituents.’ ~~ Elihu Root
Obviously our guy is no TR.
Press and Bandana make a point that the powers that be refuse to face. Bravo!
Excellent.
If he doesn’t have anything to hide, the mayor needs to speak up. If he does, he needs to resign.
I’m stuck at home nursing a dislocated shoulder and got bored enough to read the classified ads. I saw that both DMD and Brownfields have identical ads soliciting people to mow grass this year. Apparently even the attorneys see them as one-and-the-same.
Thanks LKB. It will be interesting to see who can get it done cheaper. I think in the past DMD paid to mow the Brownfields properties. That is another reason the Brownfields records are unaccessable. Would be nice is one or the moles would slip us some of the billings.
Sorry I am late to the game, but I’ve been on the road again.
As I have previously indicated, many of the local issues can and should be considered for submission to the Indiana Public Access Counselor for determination. This accomplishes a number of things that are critical for continued resolution.
The Public Access Counselor provides advice and assistance concerning Indiana’s public access laws, specifically the Access to Public Records Act (APRA) and the Open Door Law (ODL)to members of the public and government officials and employees.
First, aspects of issues that are considered by the Indiana Public Access Counselor do have the capability of setting binding precedent for issues locally
Second, if a local arm of government is in violation of any sections of the Indiana Code or Indiana Administrative Code, there are financial penalties (which can be significant) that can be levied against a municipality.
Finally, issues submitted to the Indiana Public Access Counselor do not require an attorney or elected official to seek determination. In fact, many issues submitted to the Indiana Public Access Counselor for advice come from private citizens who feel they have been denied appropriate access to public records. These citizen violation concerns usually cover two aspects of public records: Access to Public Records Act and the Open Door Law.
The important thoughts here are that the Indiana Public Access Counselor interprets the issues and approaches it two ways. If a municipality, employee, or citizen submits a formal complaint, the Indiana Public Access Counselor will issue an “Advisory Opinion” per Indiana Code 5-14-5. For cases where the issue is not so much as a complaint as a request for “clarification”, there will be an “Informal Opinion” released to assist in guidance.
In the case at hand today, we have been having a long-term discussion of the Evansville Brownfield and the aspect of their audits and whether the public has a right to see them. I did some research into this, and found something not only enlightening, the sole case from the Indiana Public Access Counselor was a case involving the Evansville Brownfield back in 2009.
In June of 2009 the Indiana Public Access Counselor released an Advisory Opinion regarding Formal Complaint 09-FC-126 regarding the “Alleged Violation of the Open Door Law by the Evansville Brownfield’s Corporation” which was as follows:
Alleged that the Corporation violated the ODL by declining to provide notice of its meetings
Alleged a citizen telephoned the office and inquired about the next meeting date and time which was not given
Alleged that the Corporation was in violation of the ODL because the Corporation’s board makes decisions at its meetings about the use of public funds.
http://www.in.gov/pac/advisory/files/formal_opinion_09-FC-126.pdf
(Do I have your attention now?))
The Evansville Brownfield’s responded with the following:
Evansville Brownfield’s contended it is not a public agency and is therefore not subject to the ODL.
Evansville Brownfield’s is a non-profit corporation organized on March 24,2003.
Evansville Brownfield’s is controlled by a five-member Board, some members of which are also public officials.
Evansville Brownfield’s is a tax exempt entity, files IRS Form 990,maintains a separate bank account, approves its own contracts, maintains its own insurance, and maintains its own records.
Evansville Brownfield’s contended it is not subject to audit by the Indiana State Board of Accounts (“SBOAâ€) that is required by statute, rule or regulation but does agree contractually to be subject to an audit.
As of 2009, Evansville Brownfield’s has not been audited by the SBOA.
Evansville Brownfield’s contended that its arrangement is similar to a fee-for-services agreement and as such it is not subject to the ODL.
After considering all this in detail, the Indiana Public Access Counselor declared as follows:
Because Evansville Brownfield is a non-profit corporation not formed by statute, ordinance or executive order, most of the entity types listed in IC § 5-14-1.5-2(a) are not applicable.
The Indiana Public Access Counselor analysis turned to the one provision which may apply, IC § 5-14-1.5-2(a)(3)(B). It is often the case that a non-profit corporation is also considered a public agency for the purposes of the ODL because it is subject to SBOA audit and the audit is required by statute, rule or regulation.
The complaint from 2009 indicated the belief that the Evansville Brownfield was a public agency because at its meetings the Board makes decisions regarding the use of public funds. That the Board may make decisions regarding its use of public funds, though, is not determinative on the issue. The question is whether the Evansville Brownfield is subject to audit by the SBOA and whether that audit is required by statute, rule, or regulation.
Evansville Brownfield indicate in 2009 that it contractually agreed to be subjected to audit by the SBOA. Contractual obligation to an SBOA audit, though, is not the same as an audit required by statute, rule, or regulation. The Indiana Public Access Counselor found no statute, rule, or regulation requiring the Evansville Brownfield to be subjected to an SBOA audit. Rather, as the Evansville Brownfield pointed out, its arrangement is more like a fee-for-services arrangement as contemplated in I.C. § 5-14-1.5-2.1 and Perry County Development Corporation v. Kempf, 712 N.E.2d 1020 (Ind. Ct. App. 1999). The Kempf court said that an entity (here, a non-profit
corporation) “does not become a ‘public agency,’ thus coming within the purview of the statutes in question, by contractually agreeing to submit to an audit. . . Rather, an entity is ‘subject to’ those procedures only if compelled to submit by statue, rule, or regulation.â€Id. at 1025.
The Indiana Public Access Counselor in 2009 decided that the facts were similar to those in Kempf. Evansville Brownfield contended the continued funding of grants is dependent on the continued performance under the applicable statutes. If Evansville Brownfield failed to perform as required, Evansville Brownfield would be required to return the money. As was the case in Kempf, “[t]he fact that said funds were derived from public sources does not transform [the entity] into a public agency.â€
In conclusion, in 2009 the Indiana Public Access Counselor issued the opinion that the Evansville Brownfield’s was not covered by the Indiana Open Door Law.
OK, now having written all that (I love legal work), I pose the following:
With the recent change by the Evansville City Council and the Department of Metropolitan Development in how the Evansville Brownfield operates, I would submit that the time is VERY ripe for a citizen to submit a complaint and request to the Indiana Public Access Counselor seeking clarification to the 2009 decision regarding Formal Complaint 09-FC-126 – “Alleged Violation of the Open Door Law by the Evansville Brownfield’s Corporation”
The reason I focus on this is the section of law in I.C. § 5-14-1.5-2.1 regarding the declaration of what constitutes a “public agency”, and I specifically refer to section (5) in that section of the Indiana Code, which states
“Any advisory commission, committee, or body created by statute, ordinance, or executive order to advise the governing body of a public agency”
Would anybody agree that the ordinance from the Evansville City Council regarding the operation of the Evansville Brownfield’s has changed from 2009, and since they are now covered by a local “ordinance” that would suffice to place them under the coverage of being declared a “public agency”
I have to opine that the circumstances have changed greatly regarding the makeup and authority of the Evansville Brownfield’s, and as such they may now be declared as a “public agency” as set out in I.C. § 5-14-1.5-2.1
Anybody want help submitting the request to the Indiana Public Access Counselor?
Classy
Yes. Contact us at City-CountyObserver@live.com
Thanks
Editor
The bigger question here is if the public thinks the City of Evansville or any of its departments should be allowed to contract with, or in any way do business with a corporation, where public funds in any form are being handed over to that corporation, IF that corporation IS NOT subject to any sort of audit or subject to Indiana public access laws?
What sort of motivation would anyone in government, from legislators, to governors, to mayors, and to DMD executives have in creating such a situation? There is only one lobby in the State powerful enough to pull this off, and we all know who they are.
Bravo, CEP!
Comments are closed.