Audit bares issues with city, parks contracts
Controller’s findings ‘little bit concerning’
When voters narrowly approved a tax increase to fund city parks, the organization that petitioned for the ballot referendum — the Pittsburgh Parks Conservancy — came under a microscope.
On Thursday, the organization’s numerous agreements, contracts and leases with the city were the subject of Controller Michael Lamb’s latest audit, performed at the request of City Council.
“We wouldn’t be able to do the things that we do in Pittsburgh parks without the conservancy, and their contribution has been stellar in many ways,” Mr. Lamb said, but his office wanted to catalog current agreements to ensure that any new parks tax revenue collected would go to new projects.
The city has not begun collecting the new tax revenue, as the enabling legislation remains stalled in council.
What the auditors found “was a little bit concerning,” Mr. Lamb said, highlighting that the 58 existing contractual documents were difficult to locate, and in some cases, were entered into by just one city department or one city authority. Authorizing council resolutions for two of the agreements could not be located in the city’s legislation records.
“Agreements that the city enters into, regardless of who they are [with], need to be countersigned by the controller and need to be part of our transparent [OpenBook contract] database,” Mr. Lamb said during the virtual news conference announcing the audit, adding that the city charter requires it.
Mr. Lamb noted that making sure agreements are documented falls on the city’s shoulders; Parks Conservancy representatives noted that they supplied many of the documents to the controller’s office for the audit.
The controller characterized some of the relationships established by the contracts as “interesting” and “not as transparent as we would like them to be.”
One example, he said, is that the city leased Schenley Plaza in Oakland to the Parks Conservancy for $1 per year for 30 years, beginning in 2004. However, under the terms, the city does not receive any portion of rental fees — including from the restaurant on-site — or any special events fees.
“I think that will come as a surprise to a lot of people that for $1 we gave away that revenue,” Mr. Lamb said, adding the revenue amount is not known.
Among the audit’s nine recommendations: The city should appoint people to the conservancy’s board of directors.
The city’s 2000 cooperation agreement with the conservancy allows for five members to be appointed by the mayor and approved by council. While the mayor and two department heads sit as ex officio members, the city has not appointed its
five members, according to the audit.
“If we had presence on that board, a lot of this information would be more transparent,” Mr. Lamb said.
To date, the conservancy has raised almost $130 million for parks restoration and improvement, mostly from private donations and grants, according to the audit — and “all of which has been devoted to the cause of park restoration and improvement,” according to the conservancy’s response to the audit.
“The conservancy is responsible for all costs and expenses associated with the maintenance and operation of Schenley Plaza,” the written response issued Thursday evening read. “Schenley Plaza has historically run at a loss. Any shortfall is covered by conservancy general operating funds. The conservancy, which raised $13 million to construct the Plaza, works annually to generate enough revenue for Schenley Plaza to become financially self-sufficient.”
Community partners also helped raise money for the plaza, a conservancy spokesman said.
Catherine Qureshi, the conservancy’s acting chief operating officer, added that “[a]s this was the first audit performed since the city and the conservancy entered into the agreement more than two decades ago, it speaks well of both parties that the review was so positive.”
The mayor’s office hasn’t received the audit, according to spokeswoman Molly Onufer, but maintains that the city has had a “long-term outstanding partnership” with the conservancy.
“This has led to transformational projects like August Wilson Park in the Hill, Schenley Plaza, the Frick Environmental Center, the transformation of Allegheny Commons on the North Side and many more,” Ms. Onufer said. “These are projects the city never could have financially taken on by ourselves — especially during the difficult Act 47 years. Through this partnership, it has been the residents that have benefited.”
The office will “review it carefully and work closely with [Mr. Lamb] to address any areas of concern,” Ms. Onufer said.
Mr. Peduto supported the parks tax referendum.
Council debated through the winter months about how to write the enabling legislation that ultimately will allow the collection of tax revenue and its distribution for parks maintenance, projects and programming. When the pandemic hit in March, the debate fizzled and still remains on hold.
The city is not obligated to contract with any one nonprofit for parks management when using the new funds, as has been pointed out by several council members and is included in the audit.
“This [audit] is something that Councilwoman [Deb] Gross and I have been asking for, a review of these agreements,” said Councilman Anthony Coghill, a critic of the parks tax, along with Ms. Gross and Council President Theresa KailSmith. “… Schenley Plaza, they rent the place and they keep all the proceeds. To me, what it points to is our fear all along, the privatization of our parks. … I’m glad we looked at [the agreements]. Some of them haven’t been seen by council. I think it’s pretty relevant that some things need to be looked at.”
Mr. Lamb said his “understanding from council members is that they are planning to enact it as part of the 2021 budget, but you know council’s been known to change its mind.”