The Grant County Economic Growth Council has provided four years of private audits to the Chronicle-Tribune in response to transparency concerns about how it spends public money.
Executive Director Tim Eckerle said the 2012 audit won’t be complete until April, but the Growth Council did provide a statement of activities through November that shows income and expenses.
The audits provide a picture of the Growth Council spending more on its programs and services after it started receiving more public money.
From 2009 to 2010, expenses for the Growth Council’s program services increased from $316,000 to $557,000. Exactly $200,000 in “discretionary projects” accounted for the most of the increase. Eckerle said this was the Growth Council’s share of Echelon Furniture’s incentive package.
Echelon encountered difficulties after its start up in Grant County and has since received a $1 million loan from Gas City to continue operations.
The other significant budget increases came from travel and promotion, which was about $20,000 more than before the county economic development income tax (CEDIT), and $39,000 for marketing. Eckerle said website development was the single largest expense for Growth Council marketing.
The Growth Council will provide future audits to the Chronicle-Tribune “if there is a reasonable request,” he said.
Eckerle replied to specific questions by email after consulting with the Growth Council’s accountants. All the audits were performed by Rea Logan and Co. in accordance with auditing standards.
The audits comprise the years between 2008 and 2011, which came after the State Board of Accounts last made a public audit and during which time the Growth Council started directly receiving and spending CEDIT.
Steve Key, general counsel for the Hoosier State Press Association, said it was “highly unusual” for economic development groups to provide such information over fears of competition.
“I would say them turning over audit information for a four-year period is extremely unusual and would applaud them for doing so,” he said.
The nonprofit’s mission is to foster job retention and expansion and it started receiving .03 percent of the county’s CEDIT rate in 2010 to help its programs and services.
However, though the Growth Council now directly receives about $270,000 per year in CEDIT, as well as other government grants, it keeps its meetings and financial records closed to the public.
This led the Chronicle-Tribune editorial board to make an informal complaint to the Indiana Public Access Counselor arguing the Growth Council should fall under the Indiana Open Door Law and Access to Public Records Act. The counselor gave the non-binding opinion that the Growth Council does not fall under the act so long as its public audits are waived by the State Board of Accounts — a key requirement for access under state law.
The State Board of Accounts has waived the Growth Council’s audit each year since 2007 because it has reported on E-1 forms that less than 50 percent of its expenditures come from tax money.
In December, the Chronicle-Tribune reported that the 2010 expenditures it reported to the state — $918,000 — were more than $300,000 less than reported on its federal taxes. The audit lists $606,000 in total expenses as well, which could put that year above the 50 percent threshold.
“The E-1 was submitted before the audit was completed and adjustments were made to the financial records during the audit,” Eckerle said.
Eckerle said the Growth Council will continue to follow the law on future transparency matters.
“The board policy has been to fully comply with both federal and state laws; additionally, regular professionally-prepared financials are shared with the Board of Directors and Grant County local elected officials,” he said.
The Growth Council’s website is www.grantcounty.com and provides information on living, working and finding potential sites for business.
Several businesses received loans originally funded by grants from the USDA Rural Development Agency. These are:
2009, Avionic Structures, $30,000
2011, Eastern Indiana Wi-Fi, $20,000
2012, Uniforms and More, $12,000
He said the public should know the Growth Council’s mission is bettering Grant County.
“The Grant County Economic Growth Council will be the champions of collaboration and opportunity, leading the charge to make Grant County one of the best places to live, learn, work and retire in Indiana,” he said.