Bounced Checks, Unpaid Debt Mar Crucian Festival

May 22, 2004 – The desire of the Crucian Christmas Festival committee executive members to "do something good for the St. Croix community" was overshadowed Friday night by suspicions of election irregularities, shoddy accounting practices and an exorbitant debt.
Chairman Sen. Adlah Donastorg at a public hearing of the Senate Finance Committee in Frederiksted probed Festival executive committee members about the organization's finances and its interpretations of by-laws.
The committee organizes the annual festival, held during the last week in December and the first week in January. The government subsidizes it.
Linese Hunt, president of the organization, said the senate appropriated the festival $325,000, but the festival received only $192,000. Treasurer Norman Edwards said some of the funds were used to cover past festival debts, but the committee remains $72,264.23 in debt.
Hunt took over the presidency in February 2003 after the resignation of Vera Falu. Hunt testified that the committee was $50,000 in debt when she assumed the post.
Hunt said that officials in the Office of Management and Budget advised her to request a supplemental budget to cover left over expenses.
Donastorg, clearly frustrated, said the government should release the remainder of the senate's appropriation. Hunt said she had promised unpaid vendors payment when the supplemental budget was allocated.
"There is no need for a supplemental budget," said Donastorg.
Laurence Bastian, who resigned as treasurer in 2003, said he submitted a financial statement to the new officers when he left the post. He said he was aware there was a deficit and requested additional funds from the government to cover expenses from the 2002-2003 festival. He said a check was sent from the Department of Finance to the committee but he did not know who received the check or for what amount the check was. "What happened to that check to cover those expenses, we don’t know," said Bastian.
Sen. Norman Baptiste wanted to know about the bounced checks that were written during Bastian's tenure. Checks amounting to over $13,000 were returned to the committee for insufficient funds. Most of the checks were slated to pay parade prizes and school bands or groups that participated in festival events.
"Proper diligence was not being utilized in the writing of checks," Bastian admitted. Citing that requests for payment were coming in "very fast," Bastian further admitted that some committee members were given blank checks to pay vendors on the condition that the needed information would be submitted as soon as possible. However, Bastian said some of that information was never submitted and some of the checks were never cashed.
Hunt said that, according to the by-laws, the committee submitted a financial statement in February of 2004. The details of that statement were also the subject of the senator's scrutiny.
The financial statement's miscellaneous section showed payouts of $11,834. When asked for an explanation, Edwards said the money was used for building supplies, tents, curtains, and "anything we have to use to put on a show." However, the document also listed a separate total of $53,657 for equipment rental and $3,317 for construction supplies.
"Something is not adding up," commented Donastorg.
Donastorg then asked attorney Iver Stridiron if he has a legal opinion regarding the authority of the inspector general to inspect the books and accounts of the St. Croix Crucian Festival and the V.I. Carnival.
Stridiron said the inspector general is, by law, authorized to conduct such audits. Carnival is a considered a program of the government because it receives government fund, Stridiron explained.
When asked by Donastorg to proceed with an audit, Inspector General Steven Van Beverhoudt said he is short staffed and cannot undertake additional projects at this time.
"I came to you during the budget process and asked for additional funds, Senator," said Van Beverhoudt. Donastorg then offered the use of staff from the legislature's post audit division to assist in completing the audits.
Donastorg said the Crucian Christmas Festival, the V.I. Carnival and the St. John July 4th Celebration committees need to be accountable. He mentioned that the government gave the V.I. Carnival committee over $1 million dollars for the 50th celebration.
"This calls for a complete audit. I have no problem with the government supporting Carnival, but we must be transparent. Every taxpayer has a right to transparency in regards to government funds," said Donastorg.
Committee members were also asked about their by-laws and election procedures. In a letter to Donastorg, former Sen. Lilliana Belardo de O'Neal, who participated in the festival as a booth owner, suggested that the by-laws and Articles of Incorporation have been violated. According to the letter, Belardo, who was not present at the meeting, questioned the validity of Hunt's presidency. She wrote, "The by-laws state that the vice president will assume the position for president in the event of a vacancy, for the un-expired portion of the term. Hunt was the vice president thus she assumed the presidency when Vera Falu submitted her resignation before her term was up. Hunt was to serve for the remaining un-expired term and then she would be up for re election."
Belardo asked that the new appointed board "go through the election process in accordance to the by-laws. "
Hunt said the language in the by-laws was vague and the executive committee was under the assumption that they could legally alter them. She said the only change that has been made to the document so far was the definition of a "member." "Booth owners are not necessarily voting members, said Hunt.
Donastorg asked the attorney general if he would be willing to assist the organization by reviewing the by-laws and make suggestions for its improvement. Stridiron agreed.
On Monday, the Finance Committee will delve into the finances of the Virgin Islands Carnival Committee in a public hearing set for 6 p.m. at the Earle B. Ottley Legislative Conference Room in St. Thomas.
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