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It may not exactly be an open checkbook of public funding for the arts in Rochester, but close enough. Last year the city doled out more than $850,000 in taxpayer funds to the Rochester Civic Theatre, Rochester Arts Center and senior center.
But financial irregularities recently uncovered at the Civic Theatre have at least one city council member ready to ask the non-profit for the taxpayers’ money back. And that could be just the beginning, according to MPR News.
“It’s insulting to me that you’d sit here and say, ‘Oh jeez, we didn’t know what was going on.’ You are on the board. You’re in charge of everything that’s going on,” City Council member Shaun Palmer said to the theater’s board president, Jeff Haynes.
Palmer is among several officials who say they want to rethink the city’s financial relationship with the theater because it appears to have been poorly managed by staff and board members. The city most recently gave the theater $200,000 to maintain its building, which the city owns.
City officials were also stunned to learn about an apparent operating loan that had not been previously disclosed, the Rochester Post Bulletin said. The theater lost some $460,000 last fiscal year.
In an attempt to address some problems, the theater obtained a $300,000 unsecured five-year loan last fall and board members pitched in a combined $100,000 — approximately $40,000 in donations and $60,000 in loans.
The loans have raised red flags, since former Civic Executive Director Kevin Miller reportedly opted against disclosing them to the city, despite the private nonprofit organization’s reports of growing dependence on outside support, including annual city funding.
The revelations come on the heels of Miller’s resignation as the theater’s leader.
Council member Michael Wojcik put blame on a lack of board oversight regarding Miller, who resigned last month.
“It’s pretty clear looking at the financials and the history of events that happened that Kevin Miller was a snake-oil salesman. He was a fraud, and he cheated the community,” he said, while stopping short of suggesting the city pull all of the organization’s funding.
Wojcik said he’d like to see the theater return $90,000 in funds intended to cover building maintenance costs, which could be overseen by the city. Additionally, he suggested the city take back at least half of the remaining $110,000, which would be held until the Civic is moving toward solid financial ground.
The episode appears to have served as a wake-up call to city hall. MPR reports city officials are considering revamping taxpayer subsidies to other arts and civic groups.
City Administrator Steve Rymer also suggested that it’s time for Rochester to think more broadly about improving the operations of the organizations it funds. Recently, he oversaw an overhaul of the Mayo Civic Center and the city’s visitors bureau after budget projections showed the facility was on an unsustainable financial path.