Wasteful, Opaque Bookkeeping At Two City Of Boston Nonprofit Arms
“The fund not only fails at being transparent and accountable in how it spends its revenue, it misses the opportunity to create financial reports to improve management of the fund.”
Some improper accounting practices have been employed for a number of years at two of the City of Boston’s integral nonprofit organizations—the Fund for Parks and Recreation and the Fund for Boston Neighborhoods.
The Fund for Parks and Recreation is involved in the maintenance and preservation of Boston parks and provides recreational facilities and programs. The Fund for Boston Neighborhoods provides educational, artistic, theatrical, and musical activities for city residents and visitors.
The problem with the accounting practices at the Fund for Parks and Recreation is that it maintains its ledger books, which were obtained through a public records request, without listing what it actually purchased for the dollars spent.
For example, an entry may list an expenditure of $1,100, but it literally does not say what was purchased for the money. There is actually a column in the ledger labeled “line description,” but it has been left blank since at least as far back as January 2017.
Though both funds utilize the exact same city accounting software program, that practice of omitting details stands in contrast to what is done at the Fund for Boston Neighborhoods, which includes a description of each expense item enumerated in its ledger.
In a telephone interview with Ryan Woods, the commissioner of Parks and Recreation, which oversees the Fund for Parks and Recreation, he could not explain why the descriptions of the items purchased are excluded from the fund’s accounting ledger.
In a follow-up email, Woods said, “The ledger requested is pulled off the city’s Boston Administrative Information System, which does not have the column filled in with any information as it is not captured by the system.” Woods further noted that he could provide information one request at a time, but that it would take some time to produce the responses. Despite that initial statement, in response to a follow-up public records request for the line descriptions for certain ledger entries, his spokesperson said the “department [does] not have a responsive record.”
Sam Tyler, the former president of the Boston Municipal Research Bureau, is troubled by how the Fund for Parks and Recreation handles its ledger books.
“It is inexcusable that expenses of the Boston Fund for Parks and Recreation are not recorded in the description column,” he said. “The fund not only fails at being transparent and accountable in how it spends its revenue, it misses the opportunity to create financial reports to improve management of the fund.”
Meanwhile, for years the other major city nonprofit, the Fund for Boston Neighborhoods, allowed an employee to ignore the accounting procedures in place for paying for goods and services. Instead, the worker paid for them out of their own pocket and then sought reimbursement from the fund. This amounted to more than $40,000 in purchases from January 2017 to July 2022 that were reimbursed directly to the employee.
This includes, for example, $6,551 for yo-yos and trolley tour bags, $6,003 for colored pencils, $3,355 for hand sanitizer, $1,421.00 for a camera and accessories, $194.99 for a Wall Street Journal subscription, and $63.35 for a cable bill.
A spokesperson for Boston Mayor Michelle Wu said that all of those reimbursements by the Fund for Boston Neighborhoods required “proof of purchase” before the employee was paid. But the fund was unable to provide paperwork for a number of the entries appearing in the fund’s ledger.
Asked for an explanation regarding deviations from the fund’s standard payment mechanism, the city spokesperson offered two reasons in a prepared statement.
“Oftentimes, vendors require credit card payment at the time of purchase and will not invoice, especially online purchases,” the spokesperson noted. In this case, however, many purchases were made with retailers that always take credit cards, such as Staples, Target, and Home Goods.
The spokesperson also said that the “majority of the time period for the document you requested was during an unprecedented public health emergency. The COVID-19 shut down severely impacted the supply chain and many vendor’s ability to cover upfront costs while awaiting payment.” Still, many of the reimbursed purchases took place prior to the pandemic and long after its peak.
Asked why the fund did not have a credit card to use for making purchases of goods and services, the spokesperson said, “It is a policy decision to protect against unauthorized purchases and ensure financial control over expenses.” Asked for a copy of the written policy, the city responded that there is none.
The employee who was directly reimbursed by the Fund for Boston Neighborhoods did not respond to requests for comment, and no longer works in city government.
Tyler, the former president of the Boston Municipal Research Bureau, is dismayed by how the fund has been allowed to operate.
“Having reviewed the expenses of the Fund for Boston Neighborhoods over several years, I question why a senior Boston official responsible for numerous purchases for city events used [their] own credit card or check to be reimbursed later,” he said. “Using a Fund for Boston Neighborhoods credit card would provide a uniform system for accounting for purchases that could be reviewed by a third party and used for planning purposes.”
