As Florida鈥檚 peak tourism season kicks off, the Florida Keys are grappling with how to address a scathing audit of its county tourism agency.
In October, the Monroe County Clerk of Circuit Court and Comptroller released of the county鈥檚 Tourist Development Council (TDC).
The Monroe County TDC, which is a legislative extension of the Monroe County Board of County Commissioners, was created by a referendum of electors in 1981 to oversee the development of the county鈥檚 tourist economy with a mix of public and private efforts.
The audit reviewed the TDC鈥檚 marketing processes, contracts, and expenditures for the period from fiscal year 2019 through 2023.
It found alleged 鈥渞epeated noncompliance鈥� with the county鈥檚 purchasing policy, 鈥渁 significant lack of internal controls and management oversight鈥� when it comes to financial management, 鈥減otential self-dealing鈥� and double-billing from a contractor and 鈥渟erious ethical concerns鈥� among leadership.
鈥淲e want to fix this,鈥� said Rita Irwin, the chairperson of the TDC board. 鈥淣obody ever goes, 鈥榊ippee, an audit鈥� but we can always learn and you must respond and say, 鈥楬ow can we do better?鈥� If there are factual things, you want to address them but if there are systematic concerns, you want to correct them.鈥�
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The allegations include that the TDC, through the nonprofit running their executive office called Visit Florida Keys, mishandles receipts and does not sufficiently review the accuracy of vendor invoices before submitting them to finance for payment.
For example, auditors found that 14% of sampled items were returned to Visit Florida Keys due to insufficient documentation or explanation of what is being invoiced. They also include that Visit Florida Keys staff may have violated county purchasing policy by submitting purchase requisitions after goods and services are purchased, not before like the policy requires.
The audit also alleges that the TDC misstated their revenues and expenditures to the public for the fiscal year 2022.
For example, the TDC annual report for the Board of County Commissioners stated that a fund controlled by the TDC identified as 鈥淔und 115,鈥� was reported as having total revenues and transfers add up to about $9.1 million. Auditors found that the number should be reported as $11.3 million, which would mean the TDC underreported that revenue by $2.1 million. Similar reporting discrepancies were found across 6 other TDC funds. The audit projects that the TDC鈥檚 fund balances at the end of FY 2022 exceeded $100 million.
During a Nov. 8 Monroe County Board of Commissioners meeting, commissioners decided to recommend the Tourist Council place its Marketing Director, the TDC's head executive, on administrative leave with pay.
On Nov. 16, the TDC Board accepted commissioners鈥� recommendation. The board also moved to have one of their members, Diane Schmidt, step in to take over the marketing director鈥檚 duties in her absence.
Management oversight
The marketing director, Stacey Mitchell, who was only referenced by her title in the audit, is accused of sharing her financial system account log-in information to delegate handling purchase orders and vendor invoices to other TDC employees without management oversight.
She鈥檚 also accused of potential ethical misconduct after hiring a photographer that she is alleged to have a long-time personal relationship with. The TDC commissions an annual photo calendar through photographer Robert O鈥橬eal. O鈥橬eal and Mitchell have a long-term 鈥渓andlord-tenant relationship鈥� as described in the audit. Mitchell declined to comment to 港澳天下彩about the audit.
The audit alleges that the focus of the calendar appears to help promote O鈥橬eal鈥檚 business website and a portion of the calendars printed through the TDC are given back to O鈥橬eal to re-sell later. No other vendors were given the opportunity to bid on the project, according to the audit, which is a violation of Monroe County purchasing policy.
O鈥橬eal said the accusation that he sells calendars the TDC purchased is false.
鈥淢y world went into the gutter,鈥� O鈥橬eal said. 鈥淚t鈥檚 devastating to have someone falsely accuse you of something, especially something like stealing.鈥�
O鈥橬eal said auditors never called him to ask about the calendar sales. He said that his photo calendar project began in 2008 with then-TDC director Harold Wheeler. Each year, O鈥橬eal takes an order from the TDC for calendars. Then, he orders extra to sell online and in local bookstores. This year, he said, the TDC requested 1,100 calendars. O鈥橬eal planned to purchase an extra 400 for himself. So, he placed an order to print 1,500 calendars and paid the order in full. Then, he invoiced the TDC for the 1,100 calendars they requested.
鈥淚t鈥檚 pretty simple math,鈥� he said. 鈥淗ad the county auditors actually take the time to contact me, I could have provided solid proof of this.鈥�
Potential double-billing and using a nonexistent company
Since the audit鈥檚 release, further investigations into the TDC were prompted.
While most are still ongoing, a review from the county attorney鈥檚 office contradicts the clerk鈥檚 finding that a TDC contractor was potentially double-billing for his services.
The October audit had accused long-time TDC contractor, NewmanPR, of double-billing the TDC for photography and videography services. It also alleged that NewmanPR may have submitted reimbursement requests through a nonexistent company named Graphics 71.
NewmanPR鈥檚 president, Andy Newman spoke at the Nov. 16 TDC board meeting. He said he was not given the chance to provide explanations for the accusation of double-billing in the clerk鈥檚 audit.
鈥淚t feels like a rusty dagger has been stabbed through my heart,鈥� Newman said. 鈥淸The audit] contains extremely disconcerting accusations against my company, my staff, our partners and family friends and others who have known our work and reputation for more than four decades.鈥�
However, on Nov. 7, the county attorney鈥檚 office released a memorandum to the county clerk, who oversaw the original audit.
The memorandum states that the county attorney, Bob Shillinger, reviewed the contract between NewmanPR and the TDC and its outlined scope of services.
While the scope of services calls for NewmanPR to 鈥渃oordinate development and distribution of news materials for trade and consumer media鈥� as well as 鈥減rovide development and maintenance of video and still image libraries,鈥� the county attorney determined that the contracted services do not include photography and videography services and production.
鈥淚n my view, no double billing exists for these services under the provisions of the contract,鈥� Shillinger wrote in the memorandum.
Andy Newman told 港澳天下彩that he is 鈥済ratified that the Monroe County attorney's office concluded that there were no double-billings being done by our company.鈥�
鈥淎t this time, I can't comment beyond that as the audit continues,鈥� he said.
Further investigation
The initial audit鈥檚 findings prompted the clerk鈥檚 office to launch three more audits of the TDC鈥檚 agencies of record. The agencies include NewmanPR, Two Oceans Digital and Tinsley Advertising & Marketing. Those financial record reviews are ongoing.
Commissioners also voted for, and the TDC board approved, the hiring of an outside fraud examiner firm, Cherry Bekaert.
The firm will review the TDC鈥檚 financial filings and contracts as well as make suggestions for improved financial management processes. A representative from Cherry Bekaert laid out the firm鈥檚 plan to independently review and consult the TDC during the Nov. 8 commission meeting. Their proposed timeline includes submitting a final report 16 weeks after they begin their independent review process.
