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Enterprise Florida told to tighten records
©Associated Press
© St. Petersburg Times, TALLAHASSEE -- The state's economic development agency, which touts itself as an example for the way to run a business, needs to do a better job keeping track of its own expenses and procedures for selecting contracts, a state audit said. The 52-page report also said Enterprise Florida Inc. treats its top executives to bonuses and lavish travel while making grants to businesses whose officers sit on its boards. Comptroller Bob Milligan's auditors said EFI officials set up a $2.4-million private bank account to cover exclusive club memberships, lobbying expenses and extra pay for leaders of the Orlando operation. Since Enterprise Florida is required to match state money with private corporate funds, the auditors said there is no way of knowing whether companies getting grants from the partnership recycled some of the cash into the perks pot. "We recommend that EFI establish a policy that requires all moneys received be deposited in the master bank account," the auditors said. Enterprise Florida has until July 13 to respond to the preliminary audit draft, the Tallahassee Democrat reported. "The final report will look nothing like this preliminary report," EFI spokeswoman Lorri Shaban said Thursday. She said the auditor's questions were about records, processes and paperwork, not money, adding EFI would resolve the criticisms point by point. In many cases, auditors said, EFI had only a company's word that the taxpayers and corporate investors got a good deal for a grant or service contract. "We recommend that EFI follow their own policies and procedures and document the methodology in selecting contracts," the report said. Another EFI spokesman, Roger Pynn, said the private account was set up to do things the old Commerce Department, as a state agency, could not do. This included entertaining business prospects in a luxury stadium box at New York Yankees games, picking up travel tabs for EFI chief John Anderson and his wife in Europe, and paying entertainment expenses at board meetings and sales conferences around the world. "It's called a private bank account because it's private money," Pynn said of the executive fund. "It's designed to cover expenses that need to be done in the private arena." But the audit said there appeared to be some "recycling" of money between EFI and private companies that match the state's funds for business development. "Our audit noted several instances where grantees were providing funding to the private bank account as a means of participating in EFI trade-sponsored events," said the draft report. "This creates a situation where state funding may be used for unauthorized purposes such as to pay lobbyists, provide political club membership fees and EFI salary adjustments." Names of companies receiving EFI grants and contracts were removed from the audit draft. The newspaper obtained the auditors' working papers, which included the names, under state open records laws. Enterprise Florida was created in 1996. Its main state funding comes from the Office of Tourism, Trade and Economic Development, but the Department of Community Affairs also contributes. Among EFI's major private supporters are Sun Trust, Walt Disney World, BellSouth, Lockheed Martin, Tupperware, the St. Joe Co., Darden Restaurants, First Union, Sprint and Tampa Electric Co.
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From the Times Business report Robert Trigaux
From the AP
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