Allegheny Regional Asset District
Board of Director’s Meeting
March 29, 2004
A Board of Director’s meeting was held on Monday, March 29, 2004 at
One Smithfield Street at 5:00PM in the Simmons Board Room.
Present were: Mr. Gerald Voros, Mr. Daniel Griffin, Ms. Joyce Baskins,
Mr. Wesley Blaha, Ms. Constance Yarris, Mr. Rick Pierchalski, Mr.
Charles Zappala. Chief Counsel Jim Norris, Executive Director David
Donahoe and staff as well as members of the public and news media
were also present. Notice of the meeting was published in accordance
with the Act and By-laws.
Ms. Yarris called the meeting to order. She advised that confirmation
of the new board members had been received from the County
Executive and County Clerk.
Mr. Charles Zappala and Mr. Rick
Pierchalski are new members. In addition, Mr. Dan Griffin has been
appointed to a new term on the Board. Ms. Yarris welcomed all and
thanked them for their willingness to serve. She also welcomed Mark
Lynch form the Advisory Board who attended the meeting.
Ms. Yarris recognized former board members, David Hamstead and
Karen Farmer White for service to the Board. Mr. Voros suggested
sending a certificate of appreciation to Mr. Hamstead and Ms. Farmer
White which staff indicated would be done
Mr. Voros requested that Old/New Business category be added to the
Board agenda which was agreed to without objection.
Election of Officers for 2004
Ms. Yarris called for the election of officers as required in the by laws
at the first meeting of the year.
She then outlined the floor
nomination procedure used for the election based on Roberts Rules of
Order.
Chairman
Mr. Voros nominated Ms. Yarris. Ms. Yarris declined the nomination
due to time constraints associated with her work.
Ms. Baskins nominated Mr. Voros.
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Ms. Yarris nominated Mr. Griffin.
There being no other nominations, a roll call vote was taken with the
final vote 5-2 in favor of Mr. Griffin. Mr. Blaha, Mr. Griffin, Mr.
Zappala, Mr. Pierchalski and Ms. Yarris voted for Mr. Griffin with Ms.
Baskins and Mr. Voros voting for Mr. Voros.
Vice Chairman
Mr. Griffin nominated Mr. Pierchalski to be Vice Chair. As there were
no other nominations, a voice vote was taken and Mr. Pierchalski was
elected unanimously.
Treasurer
Mr. Griffin nominated Mr. Blaha as Treasurer. As there were no other
nominations, a voice vote was taken and Mr. Blaha was elected
unanimously.
Secretary
Ms. Yarris nominated Ms. Baskins to be Secretary. As there were no
other nominations, a voice vote was taken and Ms. Baskins was
elected unanimously.
Ms. Yarris passed the gavel over to newly elected Chairman Dan
Griffin.
Appointment of Committees
Mr. Griffin appointed Mr. Zappala, Mr. Blaha and Mr. Voros to the
Allocations Committee. Mr. Pierchalski, Ms. Yarris and Mr. Griffin were
appointed to the Library Committee. Mr. Blaha and Mr. Pierchalski
were appointed to the Audit Committee. Ms. Baskins was reappointed
to be the Liaison to the Advisory Board. All appointments were
confirmed unanimously by the Board.
Public Comment Period
Mr. Griffin opened the floor for any comments from the public. Mr.
Glenn Walsh of Mt. Lebanon spoke on behalf the Lawrenceville branch
of the Carnegie Library of Pittsburgh requesting that the Board insist
that a widely publicized public hearing take place before a decision is
made to relocate that branch. He expressed concern that this process
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was not followed in the Hazelwood branch matter and that such a
meeting was not held until after the decision to relocate was made.
Minutes
Mr. Griffin asked for approval of the minutes from the December 1,
2003 meeting. Mr. Blaha moved approval, seconded by Mr. Voros and
the motion carried unanimously.
Treasurer’s Report
Mr. Blaha presented the following report:
Board Members:
As this is the first meeting of the Board this year, I will summarize the
results from 2003. Total tax revenue for 2003 was $71.8 million. Interest
earnings were $303,000. Taking into account all of the refunds and grant
lapses during the year, a total of $2.9 million in reserve was needed to fund
2003 grants. All of these results are reflected in the audit which will be
discussed later in this meeting. For the first time, the audit includes a
section called Management Discussion and Analysis that provides narrative
detail of the financial results for the year.
Now turning to this year, tax revenue for the first quarter totals $18.3
million compared to $18.8 million for the first quarter of last year. This is a
2.5% decline for the period. Interest earnings will be about $58,000, a few
thousand less than anticipated. Due to processing problems at the state
level, the District needed to use invested funds earlier than normal to cover
grant payments. The new revenues are now in hand and have been invested.
All grant payments are on schedule. The administrative budget is on track
with the exception of the costs for renewal of the various liability insurance
policies which exceeded budget by $50.00. If there are any questions, either
the Executive Director or I will be pleased to respond.
Submitted by,
Wes Blaha
Treasurer
As there were no questions, Mr. Griffin ordered the Treasurers Report be
filed.
Audit Committee Report
The following report was presented by Mr. Griffin:
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Board Members:
The Audit Committee met on March 11, 2004 and presented the following
report:
1.
2003 Audit
The Committee reviewed the 2003 audit with Ms. Diane Edelstein, the lead
auditor from Maher Duessel. Staff mailed a copy of the audit to all members
last month. She commended the District for the accurate and thorough
presentation of its finances and no management letter was issued.
Changes to current financial reporting standards set forth by the
government accounting standards board are reflected in the 2003 audit. The
District can no longer offset long term debt with future revenues despite the
fact that the debt is only payable if the revenues are received. Therefore,
the financial statements now show negative net assets. This should not be
confused, however, with the District’s reserve which was just under $17
million at the close of the year.
Other standards now require the auditors to spend more time with staff and
board discussing fraud awareness and detection and for the adoption of a
stated anti fraud policy. Although the District has an ethics code, it does not
cover this area specifically. Therefore, staff, in conjunction with Chief
Counsel drafted an anti fraud policy for insertion into the Ethics Code. A
copy of the draft is attached to this report and we recommend it to the
Board for adoption.
2.
2003 Agreed Upon Procedure Reviews
As a part of the District’s oversight function, the Audit Committee, on behalf
of the Board, annually selects regional assets for agreed upon procedure
reviews. Selected randomly, the asset’s internal records are compared to
the information supplied in applications and close out reports. The reviews
are conducted by the District’s independent auditor. The Committee has
chosen the following assets for review this year: Pittsburgh Zoo and PPG
Aquarium, Allegheny Land Trust, Manchester Bidwell Corporation (formerly
Manchester Craftsmen’s Guild) and Chatham Baroque.
3.
Audit Contract
With the completion of the agreed upon procedure reviews, the three year
engagement with Maher Duessel will come to an end. Following past
practice, we recommend that the staff be authorized to issue a request for
proposal for audit services for the next three years. We should be in a
position to make a recommendation on this in the fall so that the auditor is
in place for the 2004 audit to begin next January.
Submitted by
Wes Blaha
Dan Griffin
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Based on the recommendation of the Audit Committee, a motion was
made by Ms. Baskins, seconded by Ms. Yarris to insert the following
anti fraud policy into the code of ethics and the motion was approved
unanimously.
It is the responsibility of management to initiate and maintain both a
working environment and systems to avoid fraudulent acts against the
District. Management shall regularly report to the Board Audit
Committee on efforts undertaken in this area.
It is the responsibility of every employee and Board Member to
immediately report suspected misconduct or dishonesty on the part of
other employees or Board Members to Chief Counsel. Misconduct and
dishonesty include but are not limited to:
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acts that violate the Code of Ethics
theft or misappropriation of items belonging to the District
misstatements and other irregularities in company records
including intentional misstatements of financial results
wrongdoing
forgery or other alteration of documents
fraud and unlawful acts
any similar acts
Chief Counsel shall have primary responsibility for investigating such
matters and shall report findings to the Board Audit Committee
Executive Director’s Report
Mr. Donahoe explained that the Board would need to elect the at large
or 7th member position as the current term expires June 30, 2004. As
required by Act 77, regional economic and community development
organizations would be sent letters inviting nominations. A list would
then be prepared for the Board for the next meeting.
Mr. Voros suggested that in addition to the letter, notification be made
to all media in the county including the purchase of display
advertisements. Mr. Donahoe said that news releases are routinely
sent to all media and he would place ads. In response to Mr. Zappala’s
inquiry, Mr. Donahoe said that there were very few responses to the
seventh member letter particularly when an incumbent is standing for
reelection. Mr. Zappala suggested follow-up calls to the individuals
receiving the letter.
Mr. Donahoe informed the Board that the contracts were expiring for
chief counsel and the auditor and that he was prepared to proceed
with request for proposals as is the normal practice of the District.
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There was no objection. Mr. Griffin asked Mr. Blaha and Ms. Baskins to
work with staff on the chief counsel selection process. Mr. Donahoe
said that he would ask the board to continue current chief counsel
until the contractual asset renewal contracts are signed.
Mr. Donahoe informed the Board that the next Advisory Board meeting
would be combined with the communications meeting on May 12, 2004
at Filmmakers.
Mr. Donahoe called the Board’s attention to the site visit section of the
monthly report as a way for the Board to be continually updated on
asset progress. Staff has made 46 site visits this year. Mr. Voros noted
that these reports were very helpful in preparing for the budget review
process.
Ms. Yarris thanked the staff for providing the files of news clippings in
the monthly report and Ms. Baskins acknowledged the results from the
communications program.
Old/New Business
Mr. Voros asked staff to prepare a change to the by laws that would
prohibit a Board member from being an employee of an asset that
receives or seeks to receive funding from the District. Current by laws
say that a District Board member cannot be a board member of such
an entity. Mr. Donahoe said that language would be drafted, approved
by counsel and then circulated to the Board for consideration at the
next meeting.
As there was no other old/new business, Mr. Griffin adjourned the
meeting at 5:45PM.
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