NoVAC financial troubles preceded director’s resignation
The North Valley Arts Council board of directors had questioned former executive director Marie Strinden about the nonprofit's finances the day before she submitted her resignation Aug. 28. Also, the Herald discovered errors in NoVAC financial st...
The North Valley Arts Council board of directors had questioned former executive director Marie Strinden about the nonprofit’s finances the day before she submitted her resignation Aug. 28.
Also, the Herald discovered errors in NoVAC financial statements obtained through an open records request.
Minutes from an Aug. 27 board meeting show NoVAC had recently received “some bank notices of insufficient funds.”
“Their checks bounced,” Dana Harsell, past-president on NoVAC’s board, said this week.
Though that matter was resolved by NoVAC staff before it reached the board’s attention, the board still asked for “a better handle on financials” at the Aug. 27 meeting.
The board is also concerned that NoVAC staff had improperly used some revenue from Grand Cities Art Fest to pay for development and design, or “phase one,” of the in-progress downtown Arts Creation Center project, which is supposed to be funded on donations, Harsell said.
“That should have been a broader discussion,” he said. “Operating expenses should be operating expenses. … There was nothing wrong with using revenue to pay for the arts center, but you have to make sure there’s enough to pay for everything else.”
Board members do not know exactly why Strinden, who is a state legislator, resigned from NoVAC, and they do not want to speculate, Harsell said. The resignation came as a surprise, he added.
Strinden’s salary at NoVAC had been $40,316, according to NoVAC’s 2013 tax form.
Days after her resignation, Strinden told the Herald, “It was just time for me to move on.” In her resignation email, provided to the Herald by NoVAC, Strinden wrote: “I no longer believe I am the right fit for the North Valley Arts Council.”
Strinden said Wednesday she will not comment further on any matters related to NoVAC. Since leaving the job, she has been able to focus more on her legislative duties.
After Strinden resigned, Harsell said the board “pored over the financials,” to make sure there weren’t any problems, since the bounced checks “raised a red flag.”
“We’ve gone through and we feel reasonably assured that everything is on the up and up,” he said.
But the Herald found errors in a financial statement provided by NoVAC. The financial statement through July 31 had incorrect totals in all spreadsheet columns representing expenses and incorrect totals in the columns representing target revenue.
According to the statement, NoVAC’s year-to-date expenses were $179,839. But the numbers listed as expenses in the spreadsheet added up to $157,307 - a difference of about $22,500.
The spreadsheet’s July expenses were off by about $2,500, by Herald calculations, and the July 2013 expenses were off by about $1,200.
Leighann McKenzie, NoVAC office manager, said Wednesday the incorrect totals were due to an error in Microsoft Excel. Accurate totals could be calculated by adding up the numbers listed in the spreadsheet, she said, meaning that NoVAC’s year-to-date expenses, for example, were $157,307 instead of the $179,839 listed.
“When she (Strinden) cut-and-pasted, I don’t know what she did, but it brought something over that it shouldn’t have,” McKenzie said. “There was no ill-intention. It was just an accident.”
Strinden was put in charge of NoVAC’s financials after Treasurer Tom Swangler left the organization’s board last year, McKenzie said.
When the Herald requested an electronic copy of NoVAC’s financial statement, McKenzie said Thursday she discovered hidden cells in the spreadsheet, which hid some expenses, including payroll taxes, other taxes and health and disability insurance.
NoVAC’s actual year-to-date expenses are $179,839, as was stated on the original financial statement given to the Herald, McKenzie said. She also provided a statement listing the expenses that were previously hidden.
Board members also questioned a late quarterly payroll tax during the Aug. 27 board meeting. Strinden explained the late tax was “due to an error on the part of the accounting firm,” which paid the late penalty and made sure NoVAC’s taxes are up to date, according to meeting minutes.
Also in the Aug. 27 meeting, the NoVAC board had asked Strinden to submit an “overdue” self-evaluation, according to meeting minutes.
Harsell added Strinden worked from home more than the board would have liked.
But Harsell reiterated numerous times that board members do not believe Strinden was doing anything wrong in her job.
“Her job became increasingly challenging trying to balance the demands,” he said. “Her job became overwhelming.”
One challenge was Art Fest being rained out its second day this year, deeply cutting into revenue from that major annual event, Harsell said. Although Art Fest vendors’ contracts state they must stay for the entire event, he said, NoVAC allowed vendors to leave early this year due to weather.
Emails sent between NoVAC board members in the days after Strinden’s resignation, provided to the Herald by NoVAC, show the nonprofit continuing to experience some financial struggles.
For example, Board President Cindy Edwards wrote she didn’t feel it would be “the best move” to spend as much money this year compared to last year on advertising for the annual Zombie Music Fest event, happening Saturday.
In another email, regarding a hired accountant’s mistake on Strinden’s final paycheck, Edwards wrote, “No wonder we are poor,” in response to the accountant’s incorrect, too-high calculation of Strinden’s salary. The accountant’s error was fixed.
Another major challenge for Strinden was the Arts Creation Center project, Harsell said. The center is under construction above Sanders 1907 restaurant and set to finish near the end of 2015. It will be a space with various studios and performance or rehearsal rooms, all types of artists, performers and arts organizations to use.
“The arts center will still happen,” despite Strinden’s resignation, Harsell said.
He added that NoVAC hopes to soon appoint an interim executive director and start a search for Strinden’s permanent replacement. The board will also review the executive director job description to make sure the job is not too overwhelming, he said.
“(Strinden) was doing everything she was supposed to do, but she was doing it under increasing pressure,” Harsell reiterated.