Tuesday, February 26, 2002

Olympic group to return more funds

By Dan Klepal
The Cincinnati Enquirer

        Cincinnati 2012, the organization that tried to bring the Summer Olympics to town, will return an additional $13,900 in public money to the state of Ohio.

        But the nonprofit Olympic organizing group is defending its use of more than $69,500 in public cash brought into question after a state audit this month. The group also has submitted an additional $2,000 in expenses it would like covered by a state grant.

        Cincinnati 2012 was given a $250,000 grant by the state's Department of Development in October to cover its expenses between July and November 2001.

        Nick Vehr, former president of Cincinnati 2012, sent the state a list of expenses counting against the grant and a check for $61,860 in unused grant money two weeks after Cincinnati was eliminated from competition with seven other U.S. cities for the 2012 Games.

        But an audit of those receipts questioned more than $83,000 of the spending for either not having proper documentation or as being spent outside the grant.

        Mr. Vehr's group responded with an inch-thick packet of information Monday that he hopes will convince state auditors that most of that spending was proper.

        The audit found no illegalities in 2012's reporting and that there were no “material weaknesses” in the organization's internal accounting controls.

        “It's quite possible they'll have more questions and I look forward to responding in any way we can to satisfy them, to answer any remaining questions,” Mr. Vehr said.

        Among the explanations Cincinnati 2012 sent to the state:

        • Cincinnati 2012 says $40,188 of two bills from a consultant totaling $43,606 should be covered by the grant. The group provides receipts of expenses from June and July along with a letter from the president of the Salt Lake City consultant that says they were paid in lump sums for work performed primarily in June and July.

        • Cincinnati 2012 says the entire amount of $24,150 for two University of Cincinnati studies should be covered. One was for the economic impact of the Games and one on budget risk analysis. The reports were written before the grant period.

        Mr. Vehr said the benefit of the studies was realized in July, during a United States Olympic Committee visit to Cincinnati. Mr. Vehr said the state was aware that his organization was going to claim this amount and had signed off on it before the audit took place.

        • Cincinnati 2012 said more than $4,200 that exceeded the group's budget was spent in the “spirit” of the grant and that they were given permission to revise their budget.

        Among the expenses Cincinnati 2012 admits should not have been submitted: $715 for restaurant, laundry and telephone charges from the Marriott RiverCenter; $1,054 for consulting services prior to the grant period; $3,634 for copier rental before the grant period; and $3,325 for payroll outside of the grant period.

        When asked if Cincinnati 2012 has sufficient money to cover the entire amount questioned by the state should it be forced to repay it all, Mr. Vehr declined to answer.

        “We've concluded that's the amount that is appropriate for us to reimburse the state — either based on the quality of documentation or our inability to dig back into records without the benefit of staff and a functioning office,” Mr. Vehr said.

        Mark Rickel, a development department spokesman, said it may take a while before the state and Cincinnati 2012 work out their differences. The auditor who checked 2012's books was not available for comment Monday.

        “This is very much a work in progress,” Mr. Rickel said. “We'll be going back and forth, so it could take a while.”


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