Meggs: Town Bailout of Chamber is Unlawful
BLYTHEWOOD – After it was revealed last week that the Greater Blythewood Chamber of Commerce is $22,000 in the red and is currently operating on a $20,000 line of credit, Interim Chamber Director Phil Frye raised eyebrows on Council when he announced the Chamber would no longer request the $17,500 grant from the Town’s general fund that it has requested and received annually for several years.
“You are down $22,000! How can you not ask [for the grant]?” Mayor J. Michael Ross asked. “You’ve overspent, it looks like, and now you don’t need our money? I guess this is the fiscal responsibility we’ve been talking about over, over and over.”
Town Attorney Jim Meggs made it clear where Council should be standing on the issue of funding for the Chamber.
“You’re not a bank,” Meggs said to Ross. “Anything you do with public money has to go to a lawful public purpose. Being a bailout source is not an appropriate public purpose.”
“But they aren’t asking for the $22,000,” Ross said. “That [grant] is the same thing they’ve been asking for every year.”
Meggs shrugged, standing by his advice.
Ed Parler, Council’s liaison with the chamber board, offered his explanation concerning the Chamber’s numbers.
“The $22,000 is the profit and loss from July 1, 2018 to the projected end of the current fiscal year,” Parler said. “It is not the bank balance. [The Chamber] is anticipating taking a hit of $22,000 from the previous year. We are now operating on a line of credit until the membership dues begin coming in. With sound management, we are working toward a balanced budget.”
“That’s a big hallelujah,” Ross said, drawing laughter from the audience.
“The Chamber board voted unanimously against coming to Council for a bailout,” Parler said.
“My hat’s off to you,” Ross said. “I think you’ll get the confidence of the community back that you have somewhat lost. It’s a great step forward.”
Councilman Eddie Baughman thanked Frye for providing the Town with the financials.
“Mike and I have talked. It is what it is and it showed what it showed,” Baughman said. “I appreciate you tightening the boot straps. It shows a lot of character.”
“The good thing, Phil, is that if we don’t give you any money, you ain’t gotta tell us anything [about your finances],” Ross joked in an apparent reference to the requests The Voice has made for the Chamber’s financials over the past two years.
Frye said the Chamber did, however, want to request that Council continue to purchase a $2,500 premiere membership with the Chamber, an amount that is in the Town’s proposed budget.
Frye also asked for $14,000 for the Chamber for a fall fundraiser event. Frye said the Chamber hopes to net $10,000 from the event.
Frye assured Council that the Chamber would be more transparent with its finances in the future.
While praising the Chamber’s promise to be financial responsible in the future, no one on Council asked questions about the Chamber’s vague financials from this fiscal year or lack of financials from prior years. According to CPA Bob Massa, formerly both a Council member and member of the Chamber board, the financial documents submitted last week and last year by the Chamber are vague and do not show with any clarity as to where some of the money that came into the Chamber ended up.
“Those financial records absolutely can’t be followed with any accuracy,” Massa said. “It’s anybody’s guess what was going on. They apparently kept no books on the chamber until someone started asking for them last year. And Mr. Switzer is apparently no longer available to comment on those financials. It’s hard to follow.”
Town Attorney Meggs is exactly right, when he told them that the Town is not a bank for the Chamber. The bulls-eye for Chamber mismanagement belongs squarely on the backs of the Chamber Board of Directors, especially the Treasurer. Read the By-Laws for the duties and responsibilities of the Treasurer. Except for dedicated funds (the Visitor’s Center?), the rest of the Chamber’s income is general revenue. The expenses must be known, because they seem to know that the deficit was $22,000. Just look at each line of spending, and you’ll know where the money went. There are receipts and canceled checks, aren’t there?
Mr. Philpott, the Town of Blythewood has a great deal to benefit from a strong and successful chamber of commerce. I joined the Board just last year because I was proud to serve an organization that has grown to over 160 members and provides a great deal of useful events for local businesses and for the entire town of Blythewood. To characterize the chamber as being mismanaged is an unfair statement. The chamber would have been in very solid financial condition had the town council not rescinded it’s financial support – financial support that was stripped away based upon false accusations, rumors and political gamesmanship.
Mr. Rega, I have been a member of four small chambers and an employee of four large chambers, including as Membership VP for an 1,100-member chamber in the Midwest. (It had 1,300 members when I was hired. I quickly got rid of 200 deadbeats who hadn’t paid dues for 18 months or more.)
A strong chamber can be a great asset in any community, small or large. When a Chamber (or any business) does not generate periodic financial statements, that IS mismanagement. Without them you don’t know whether the ship is floating or sinking. When the bottom line gets redder and redder, then you either increase income or cut expenses. Apparently, the Blythewood Chamber apparently did neither. If the Town had seen value for its membership dues (investment, contribution, donation, whatever you want to call it), it would have continued funding.