James Pilcher

jpilcher@enquirer.com

When Cincinnati Park Board executive director Willie Carden helped represent the city on a Sister Cities trip to Italy in June 2013, he went shopping. Those purchases, made with his board-issued credit card, included hundreds of dollars on stationery and leather goods at the Cartoleria Pantheon in Rome and the Leather Guild Firenze in Florence.

Carden was initially reimbursed with public funds. But later, the foundation that serves as the fundraising arm of city parks covered these purchases and more than $50,000 in other travel, dining and personal spending for Carden and his top lieutenant, Marijane Klug, over a two-year period. That figure included airfare for the two of them and others.

Klug, as parks finance manager, would approve her own expenses, records show.

The expenses and how they were paid reflects the entangled relationship between the public Park Board and its nonprofit arm, the Cincinnati Parks Foundation, and how that relationship impaired oversight over such spending.

Parks officials justified the expenses as part of “the cost of doing business” to generate more donations for city parks.

Park Board Chairman Otto Budig and Carden both said the foundation paid for the expenses after an “internal review” by Klug. That review, which was not documented in records received from Enquirer requests, determined public funds should not have been used initially, they said.

Records show Klug also charged tens of thousands in expenses on her own credit card, some on overseas trips.

Carden's purchases in Italy came less than a year after he purchased noise-canceling headphones for $350 just prior to another trip to Europe. That also was initially covered by public money reimbursed later by the Parks Foundation.

“What’s the point of even having a foundation if Carden and Klug can pay for whatever they want?” said Over-the-Rhine lawyer Tim Mara, an outspoken Park Board critic who opposed the permanent property tax levy that failed by a 3-2 margin last November.

The findings come as part of a four-month Enquirer investigation into finances at the Park Board and the Parks Foundation. Previously, it was revealed that most of the publicly funded construction work on Smale Riverfront Park was done through a no-bid process, raising worries over violations of city and state laws. The Enquirer also reported the two organizations were so entangled that steps have been taken to separate the two and formalize the handling of money.

Park Board halts construction after Enquirer report

'I think that's a good deal'

Carden said he agreed the purchase of the headphones created “bad optics” publicly. But he justified the expense by saying the headphones allowed him to be rested after a trans-Atlantic flight taken as part of a Sister Cities trip to Munich, Germany.

“I had a presentation to do pretty soon after landing, so I wanted to be fresh for that,” Carden said. "And given that we do present in other places, I will get good use out of them."

He defended the other expenses as necessary for either Park Board or foundation business.

City Manager Harry Black told The Enquirer city policy calls for departmental credit cards to go through the city's central purchasing department. He expressed surprise that Carden’s American Express card and Klug's PNC credit card even existed, saying they must have been obtained outside the city's procurement process.

The city currently contracts with Fifth Third Bank to issue MasterCard credit cards, he said.

Chief Procurement Officer Patrick Duhaney also was surprised at the existence of the credit cards for Carden and Klug. It's difficult to monitor them because they were obtained outside the normal system, he said.

Budig praised Carden for his work in resurrecting the foundation in the early 2000s and for helping raise tens of millions of dollars for the park system. The expenses were worth it, he said.

Parks: Public board, private foundation often operated as one

“If you look at what the Park Board and the foundation spent for things like this and the millions we got back, I think that’s a good deal,” Budig said.

In the days leading up to last fall’s election, The Enquirer reported the Park Board gave several bonuses paid to Carden and Klug through the Parks Foundation for tax reasons. The Park Board also paid for Carden's and Klug’s car allowances as well as dining and travel out of public funds, The Enquirer reported.

Lunches at Wild Ginger

Carden frequently charged lunches to the Wild Ginger Asian restaurant in Hyde Park. In one two-week span in July 2013, he visited there three times, charging nearly $200. Those expenses were paid out of park endowments, but were later reimbursed by the Parks Foundation.

Carden said he was meeting with a potential donor to the parks system, and that the donor liked that restaurant. He declined to identify the donor or say whether this person wound up contributing to the Parks Foundation.

The credit card statements also showed frequent purchases at nearby grocery stores and gas stations. Carden is paid a car allowance of $1,000 monthly.

The list of expenses incurred by Carden includes $2,300 worth of gift cards to the Moerlein Lager House on The Banks; Moerlein owner Greg Hardman was on the foundation board until earlier this year.

Carden said the gift cards were requested by an unnamed Park Board commissioner to be given out to staff members as rewards. The Park Board initially paid for those cards, only to be reimbursed later by the foundation.

Last year, at least two statements showed the Park Board didn’t fully pay off Carden’s card and was forced to pay interest on the balance. This failure to pay the balance on time resulted in interest rate charges that in one instance exceeded $150.

Carden said there were times the Park Board paid the bills late, and he called to get the interest reimbursed. But one recent bill shows there had been more than $250 in interest charged for the year, and only $90 of that had been charged in the current month.

“That is a huge no-no in city accounting,” said City Councilman Kevin Flynn, chairman of council’s audit committee. “You should be on top of that every month. That is just wasted expense for the taxpayers.”

The private Parks Foundation was not immune to lavish spending. Once, the Foundation treated its 40-plus member board to a $7,000 lunch catered by the now-defunct Mahogany’s restaurant previously located on The Banks, according to documents and receipts obtained by The Enquirer through open records requests.

Klug held a credit card in her name issued by the Parks Foundation with a $5,000 credit limit. Foundation officials say they canceled the card in December. Klug also holds a separate credit card issued through the Park Board with a $50,000 limit that routinely carried a balance of more than $10,000 monthly in 2012.

Klug also was issued her own American Express card associated with Carden's account.

List of Cincinnati Park Board and Cincinnati Park Foundation members

Endowment money used to cover expenses

The public money used to pay these expenses came from the Park Board’s series of endowments, or money bequeathed to the agency by private citizens over the last century. Most of that money can be used only to pay for repairs or upkeep for certain parks, but a few allow for general expenses.

Mayor John Cranley has said he considers those endowments public money and last fall ordered an external audit of the Park Board, its use of endowments and its relationship to the Parks Foundation.

Parks Foundation board Chairman John E. Neyer said he “was not prepared to go through line by line” to discuss the expenses, and said he never saw any request to cover them while serving on the board’s executive committee as treasurer in 2014. In one email obtained by The Enquirer, he acknowledged he had "not been a very active treasurer."

“I do not think that some of how it was done before uniformly shows the best practices of nonprofit management,” Neyer said in a separate interview. “But I can’t shed light on the extent or frequency that stuff was done and can’t be terribly illuminative.

“But we did make sure that a proper set of financials was reported and distributed and budgets were prepared and approved," he said.

Budig and Neyer both stressed that new policies and procedures are now in place to prevent such transfers and to provide greater oversight.

“Our goal is to be as efficient as possible and we have nothing to hide,” Neyer said. “I think the team has done a good job. There’s nothing missing and nothing got stolen. But we strive to continually get better.”

Enquirer reporter Carrie Blackmore Smith contributed.

Parks: Public board, private foundation often operated as one