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City Controller Alan Butkovitz is asking that former Mayor Michael Nutter and former City Representative Desiree Peterkin Bell pay back tens of thousands of dollars in expenditures as part of his latest audit on the troubled Mayor’s Fund for Philadelphia.
The latest review, released Wednesday, comes seven months after a Butkovitz audit of the Mayor’s Fund for Philadelphia claimed the former chairwoman used $380,000 from Philadelphia Marathon proceeds as a “slush fund” under Nutter’s watch.
The new audit revealed that, under Peterkin Bell’s leadership, the fund spent at least $134,000 without any providing receipts or any supporting documentation as well as $32,000 in grants without the required board approval.
The Controller recommended that the Mayor’s Fund seek reimbursement for $219,000 “in credit card purchases that were not properly documented and did not meet the mission of the non-profit” from others involved with the fund, in addition to Peterkin Bell. Butkovitz also said the fund should seek reimbursement from Nutter for $22,100 spent on a farewell party at the end of his second term.
“There was little, if any, indication from documents and from those who attended as to how this event benefited Philadelphians — other than those who were in the Mayor’s inner circle,” Butkovitz said during a news conference.
Nutter did not immediately respond to a request for comment.
Peterkin Bell said in a statement, “This is getting tiring and very old. This narrative, these accusations are not true. We all know it’s an election year, it’s abundantly clear that it’s not about the pursuit of facts, it’s about managing perception in an election year.”
The Mayor’s Fund is an obscure nonprofit run by city officials that is mostly funded through marathon registration fees. The fund manages up to $10 million a year, money that is supposed to be spent on programs that support the mayor’s goals.
Former Governor Ed Rendell, who also served two terms as Philadelphia’s mayor, said his farewell parties were paid by his own political action committees. “The Mayor’s Fund is supposed to benefit the city of Philadelphia. It would be hard to argue that a going away party for the mayor or anyone else benefits the interests of the city.”
Rendell called the matter a “minor transgression” that “should not detract from [Nutter’s] significant record of having an ethical administration. But again, [the party] isn’t in the mission of the fund.”
Butkovitz said his office has shared its review with the city’s Board of Ethics and a number of law enforcement agencies, including the District Attorney’s Office and the state Attorney General’s Office.
Other findings in the controller’s report include:
• Most of the $70,000 used to pay for the 2015 Tree Lighting Ceremony came from the Mayor’s Fund, but without any board approval. The 2015 ceremony was five times the annual cost of previous years when money from the Mayor’s Fund was not used.
• The fund paid $22,100, without board approval, for a farewell celebration for Mayor Michael Nutter planned by his executive staff. According to the controller’s report, after questions were raised about spending the funds on the party, staffers in charge of the event changed the invitation to include honoring two programs that had been given money from the Mayor’s Fund.
• One of the fund’s credit cards was used to pay for a “Purpose Not Position Dinner” event at the Hyatt Bellevue for 15 people hosted by Peterkin Bell. The event, titled after a slogan Peterkin Bell often uses on social media, cost $2,195.
• Of five months of American Express credit card expenses, which totaled $242,097 — more than half of the expenses for 2015 — only $108,500 were properly accounted for.
• Of the $92,266 charged on two Wells Fargo Mastercards during 2015, less than $6,000 had proper documentation.
The fund’s executive director, Ashley Del Bianco, who raised concerns about the fund to the controller’s office in January 2016 after Nutter and Peterkin Bell left office, could not be immediately reached for comment. Through a spokesman in the mayor’s office, she issued a statement that said in part:
“The report’s findings and recommendations will be shared with Mayor’s Fund Board of Directors for their consideration. Today’s report and recommendations provide critical guidance to the Fund in these ongoing efforts, and the Fund thanks the Controller for his continued attention to this.”
The Inquirer previously reported that Peterkin Bell, was able to spend $52,000 of the fund’s money in 2015 on hundreds of Uber rides, meals at fancy restaurants, and shopping at Macy’s, without documentation. Her predecessor, Melanie Johnson, was caught misspending fund money and had to repay the city $733.
Almost every time the Mayor’s Fund has been in the news, Nutter and Peterkin Bell have lashed out at Butkovitz and Del Bianco. Peterkin Bell sued Butkovitz and Del Bianco for defamation last year over the controller’s characterization that Peterkin Bell treated the Mayor’s Fund like a “slush fund.” A Common Pleas Court judge tossed the lawsuit last month.
Last last week, following an Inquirer story that questioned Peterkin Bell’s expenses and lack of documentation, Nutter issued an angry 1,500-word statement that called Del Bianco “unscrupulous and deceptive.” He wrote on his personal website that she “has demonstrated the worst of human traits — a lack of honesty, serious personal character deficiency, and a lack of professional integrity.” The statement was taken down from his website two days later.
Some of Butkovitz’s recommendations include strengthening board oversight and improving the fund’s credit card policy. He also recommends that the fund get rid of a reserve fund that had been historically used as a discretionary fund for the City Representative’s Office.
The Kenney administration already merged the reserve fund with the grants fund so that there is only one pool of money for all grants. The new administration has also made some other changes to the fund since the controller’s August report.
Butkovitz’s report also suggests that nearly $100,000 in hotel and travel expenses made by the fund in 2015 might be in violation of the city’s ethics laws that require city officials to disclose gifts received, including travel.
“A review of financial disclosure forms for the mayor, former chairwoman and former chief of staff found there were no accommodations paid with the Mayor’s Fund monies disclosed on their reports,” the controller’s report states.
These accommodations were the 25 hotel rooms the fund spent $52,000 on in 2015 for various city employees (and some of their relatives) to stay at the Marriott hotel across from City Hall during the papal visit. The fund also paid for Nutter and some of his cabinet members, including Peterkin Bell and Gillison, to fly and stay in Rome for a few days in their effort to get the Pope to come to Philadelphia for the World Meeting of Families. The fund spent $44,665 on that trip.
“If these city employees were on official business, it raises the question of why the purchases did not follow the city’s standard procedures for making the purchases, submitting the appropriate receipts and approvals and then getting reimbursed through the city,” the controller’s office wrote.
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