Auditor slams Denver Zoo for stonewalling financial review

Denver’s major cultural facilities have, for several months now, been scrambling to squelch dissent among smaller cultural groups that sought a higher percentage of regional cultural tax revenues than they’ve been getting. Fearing they’d lose their gravy train, the big players warned that squabbling over Scientific and Cultural Facilities District (SCFD) funding might prompt taxpayers to vote against renewing the tax subsidy in November.

As of late last week, it looked like the long public relations struggle had ended.

By agreeing, at least in theory, to offer $750,000 in arts grants, SCFD’s top tier recipients – the Denver Art Museum, the Denver Botanic Gardens, the Denver Center for the Performing Arts, the Denver Museum of Nature and Science and the Denver Zoo – seemed to have succeeded in silencing criticisms from smaller, Tier II and Tier III cultural organizations. The tentative pact is designed to ensure that when lawmakers vote in the coming weeks on whether to put the tax reauthorization plan on November’s ballot, there will be a united front among SCFD recipients big and small, and no more bickering about funding and transparency.

But now there’s a glitch.

On Monday, Denver’s Auditor blasted the Denver Zoo for stonewalling a review of its finances. The Zoo is expected to receive about $8.5 million in SCFD funding this year. It sits on 93 acres of Denver parks land, benefits from city bonds and gleans about $2 million annually from the city’s general fund, according to Auditor Timothy O’Brien’s office.

All those taxpayer subsidies, O’Brien says, warrant a thorough review of how the Zoo spends tax dollars.

“Despite the huge influx of public funds, the Zoo has claimed that its financial records are confidential,” he said in a written statement. “On February 4, one board member revealed the Zoo’s interest in delaying any audit results until after the November election to reauthorize SCFD funding.”

Zoo officials were mum about O’Brien’s bombshell Monday, refusing to give interviews at least until its management and the trustees of the non-profit that runs it – the Denver Zoological Foundation – evaluate his comments.

“The Foundation remains committed to its longstanding and successful relationship with the City and County of Denver for operation of the Denver Zoo, and has always operated with transparency with our stakeholders,” reads a prepared statement.

Transparency is hardly the word O’Brien’s office would use to describe how Zoo officials are operating. Spokeswoman Kathleen MacKenzie says O’Brien had several private meetings with Zoo President Shannon Block to set the scope of the audit – the first in the 60 years the Zoo has had a cooperative agreement with the city. Among other objections, Block apparently refuses to let auditors interview her staff without Zoo management or board trustees present.

“The Zoo’s approach is not consistent with audit industry standards,” O’Brien’s statement reads.

The next step, as MacKenzie tells it, would be for Denver’s Parks and Rec Department to notify the Foundation that it’s in breach of its 1998 contract with the city. The Zoo then would have 90 days to remedy the dispute. If no agreement is reached, the city could end its contract with the Foundation and find another group to run the Zoo.

“It would be unusual to get to that point,” MacKenzie says.

The flap with the Zoo isn’t the first time Denver’s Auditor’s office has had trouble prodding a semi-public entity to open its books. Former Auditor Don Mares spent years feuding with Winter Park Ski Area about making its finances public under its cooperative agreement with Denver.

Says MacKenzie: “These disputes tend to involve agencies that think they’re not part of the city.”

How, if at all, this week’s monkey business about Zoo transparency will affect the newly brokered SCFD pact remains to be seen.

The SCFD collects one-tenth of one percent sales tax as the main public funder of cultural institutions in the seven-county Front Range metro region. If lawmakers allow it, re-authorization for that tax will be up for renewal on November’s ballot.

Among the main complaints among smaller SCFD recipients is a lack of transparency by the Zoo and four other Tier I recipients – who receive about 65 percent of SCFD revenues — about how the re-authorization plan was structured.

“Some groups go about their business with a deep sense of entitlement. They seem to act as if they’re above the law,” says Stella Yu, the now-retired founder of Arts Street, a Denver-based program helping high-risk youth channel their artistic talents into jobs.

“We’re talking about public money here. A lot of it,” Yu adds. “There’s no question that the Zoo should open its books.”

Free-marketeer John Caldara opposes the SCFD tax on grounds that “taxpayers shouldn’t be funding the entertainment of a relative few.” Still, even SCFD loudest critic is certain the tax will be reauthorized this fall, even with a flap over the Zoo’s transparency.

“The Zoo not opening its books won’t get SCFD defunded. Nothing short of the Zoo not opening its gates would get rid of that tax,” Caldara, president of the libertarian Independence Institute, told The Independent. “In a year like this, when nobody will be paying attention to anything down-ballot of the presidential and U.S. Senate races, the SCFD will get a rubber stamp. I’m sure of it.”

Photo credit: samuelrodgers752, Creative Commons, Flickr

 

 

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