A state-level review of Westfield’s 2018 finances found city officials failed to comply with state laws and guidelines when they entered into an informal agreement with Bullpen Tournaments.
The State Board of Accounts recently filed a supplemental compliance report that validates some Westfield City Council members’ concerns about the way the city has conducted business with Bullpen Tournaments, the company responsible for managing the ball diamonds at Grand Park Sports Campus.
According to the report, state examiners found the city’s contracts with Bullpen were never properly memorialized and there was insufficient evidence to determine whether they’d been appropriately discussed for public review.
“The city was not afforded any opportunity to gain the appropriate knowledge to become compliant,” Westfield Communications Director Vicki Gardner said in a written statement. “As anyone can recognize, Grand Park is not a typical governmental operation, and we strive each day–based on the knowledge we have–to always align with the laws and regulations of this great state. Specific to these findings, we operated based on the guidance of our professionals and instruments authorizing our leadership team to approve use agreements for Grand Park.”
Council member Troy Patton first alleged in July that Bullpen had failed to meet the standards of its contract, and that it owed the city $470,000 as of May 31.
Mayor Andy Cook responded by saying the city had reached an alternative agreement with Bullpen. He then vetoed the council’s attempt at additional oversight of the park’s contracts and launched a third-party financial review of all city practices.
Even as that city-level review began, the State Board of Accounts was working on its own review of the city’s finances.
State Examiner Paul Joyce stated in his report that Cook did sign the initial Oct. 24, 2014, agreement transferring the rights, duties and obligations of Indiana Bulls Inc. to Bullpen Tournaments. The agreement included an arrangement in which Bullpen was required to remit part of its admission, merchandising and parking revenues to the city.
The state found Westfield did receive that money in 2016 and 2017, but the only fees collected afterward were for electric and indoor leasing fees.
Even when it did collect the money in accordance with the contract, the state’s auditors could not verify that the admissions, merchandising and parking fees were appropriately calculated, due to insufficient documentation.
Those issues might have been null, had a modification to the agreement been appropriately memorialized.
According to the state’s report, Grand Park Director William Knox said the city informally agreed to have Bullpen perform maintenance in lieu of paying fees and provided a proposal with a target close date of Jan. 1, 2017.
Under that informal agreement, Bullpen was allowed to stop paying the city those fees and instead share its advertising and sponsorship revenues with the city.
The agreement required Bullpen to pay the city $360,000 annually, starting Dec. 31, 2017. The State Board of Accounts found that money would then be deposited into a turf replacement escrow with the remainder being considered a lease payment to the city.
The agreement also allowed Bullpen to retain any hotel booking commissions stemming from the diamond’s operations and assume all concessions contracts. In exchange, Bullpen would be responsible for mowing, cleaning the campus’ buildings and garbage removal.
According to the state, none of the involved parties signed the proposal and there was no discussion of the modified agreement in any of the meeting minutes for the City Council, Board of Public Works, Redevelopment Commission or Redevelopment Authority.
“We find no authority for the change to the terms of these agreements without the formal approval of a legislative board with authority to contract,” Joyce said in the report. “Documentation regarding admissions, merchandise sales, and parking revenues received by BPT was not provided, so we could not determine the dollar amount of revenues that should have been remitted to the city for 2018 through 2019.”
Gardner said the agreement has saved Westfield taxpayers hundreds of thousands of dollars.
“We are constantly seeking ways to enhance the overall experience and operation of Grand Park,” Gardner said. “Rest assured, we take these findings seriously and will work with all stakeholders to bring remedy and continue to advance our city and Grand Park as a leader in our state, region and country.”
The state also found 18 other campus-use agreements between the city’s Redevelopment Commission and Grand Park, but minutes from that year aren’t clear enough to show whether those proposals were ever publicly discussed in detail.
Additional noncompliance issues include Bullpen’s lack of financial reporting. Under the official 2014 contract, Bullpen was supposed send the city an unedited balance sheet and income statement every month.
Bullpen only provided one financial statement to the city on May 31, 2020. It was also insufficient, in that it only included monthly financial activity and balances for January 2020 through May 2020.
The state also questioned whether Bullpen was fulfilling its 2011 sublease through the city.
“The sublease was not signed,” Joyce said in the report. “It is unclear based upon the dates in this lease and conflicting terms if (Bullpen) is complying or not, and if the rent being paid is correct.”
Westfield Council President Joe Edwards said part of the problem is that the city’s Redevelopment Commission has not properly informed the council of its financial dealings and that it has “ceded its authority” to Cook and his chief of staff. He said doing so has removed a layer of “citizen oversight,” which has led to the city’s current internal control deficiencies.
“I believe the longer-term solution lies in greater and better citizen oversight of these affairs due to the use of public funds,” he said.