A Downtown merchant is raising questions about how the executive board of the Downtown Lodi Business Partnership is using city and business assessment funds during a rough economy.
Michael Warren, owner of Crush Kitchen + Bar and the Market at Crush, spoke at Wednesday's Lodi City Council meeting about $9,000 in total bonuses granted to the board's executive director.
Warren, who was elected to the board in December, said his main concern is with a portion of the bonuses specifically linked to the farmers market — roughly $5,000 — given to Executive Director Jamie Watts. That payment is based on a percentage formula from net profits earned during the farmers market and approved by the board of directors, Watts said.
Since the market is being cut short by five weeks in 2011, the bonus shouldn't be provided, Warren said.
"In our bylaws, it says we work toward creating an awesome Downtown, but yet they are willing to take farmers market away for five weeks and put it in her pocket," Warren said.
Members of the executive board, which provides an annual review and salary recommendations for the board of directors to vote on, said the bonuses are in lieu of a cost-of-living adjustment, as opposed to in addition to it. The bonuses were voted on before the dates of the farmers market were cut, said Nancy Byer-Hauan, executive board member and president of the partnership.
The farmers market was reduced this year because the partnership expected the city to cut its funding and needed to look for ways to trim costs, said Byer-Hauan. Watts' bonus was granted for her work conducting last year's market, she said.
Watts also received a bonus of $1,482.17 for the Parade of Lights. The bonus was given because the parade had net profit of 82 percent, she said. The parade's revenue was $12,050 and its net income was $9,881.
"The bonus is more of an incentive for me to help the event succeed," Watts said. "It's a standard practice in the industry."
Watts earns a base salary of about $47,000 and does not receive retirement or health benefits. She has not had a raise in more than three years, she said.
Watts also said it's the board's decision to offer her the bonus based on how they assess her performance for the previous year.
"I didn't have anything to do with the compensation structure," she said.
Since the city granted the DLBP $28,000 during this fiscal year, Warren said the organization should be cutting costs wherever it can. The organization also receives money from all of the businesses in the Downtown area through business assessments.
Warren cited a $150 gift executive Watts bought for her assistant as money that could be better spent elsewhere.
"Spending $150 of business owners' money on a birthday present for employees is outrageous," Warren said.
The gift was purchased as both a gift and as reward for a job well done, Watts said.
Warren also pointed to the partnership's website, which still lists the 2010 board of directors as active members. Several of the people listed are no longer with the board. The site also has a link to available properties to rent in Downtown. Some of the sites listed as available have been rented, and other vacant properties are not listed. The partnership spends more than $1,000 annually on the site.
Byer-Hauan said that a motion to update the site was approved at the board's last meeting, and a full-scale property audit is underway to list what Downtown properties are available for rent.
Watts' cell phone expense was also questioned by Warren. As part of her salary, Watts receives an $1,800 cell phone allowance annually. Since she has a computer and office phone available to her, the cell phone bill should be smaller or nonexistent, Warren said.
Byer-Hauan said the cell phone expense averages about $150 a month, and is legitimate since Watts' cell phone is listed on her business card.
Warren said he is not accusing anyone on the board of impropriety, but recommends that the organization has an independent audit. He said the organization hasn't had one in two years.
Byer-Hauan said she's spent the past month going over the board's financial records from the past 18 months with Warren, and expressed displeasure that he didn't bring his concerns to the board first or go through the proper procedures to request financial information.
"It's unfortunate he went down this path," she said. "He never put it on the agenda at board meetings or spoke of it as a non-agenda item."
Warren said he received a letter in March from all four executive board members rejecting his request to review the financial records. It was only after he pushed that he saw records on Wednesday, he said.
Warren said he felt that as a board member it was his duty to make these finances public, especially because it involves taxpayer money. He didn't approach the board with his concerns because the board approved the bonus in the first place and Warren felt his point wouldn't be listened to.
"Clearly, that's why businesses elected me. They want me to do my job. And this is what my job is: to cut money where we can to keep the DLBP alive and self-sufficient," Warren said.
Mayor Bob Johnson said he knew Warren was upset about the farmers market, but it came as a surprise when Warren discussed the bonuses during the council meeting.
"Having said that, if a person raised a question on a group like that about how the finances are handled, then those questions should be answered," Johnson said.
He does not imagine the city will investigate the organization's finances, because it has its own board of directors.
Local business owners were divided on the subject of the director's compensation and the farmers market being cut short.
Al Nunes, owner of Thornton House, said he agrees with the market being reduced by five weeks, but would need more information about the compensation before making an opinion on it.
"In September, the market is running low on vendors and the farmers are running out of produce," Nunes said. "But I have no thought on the compensation side until I see what she is doing for the money."
Cellardoor manager Vanessa Foreman said she was disappointed to find out about the farmers market because her business profits from it, and said it is especially helpful during the down economy.
"We are all trying to build our businesses back up and maintain them. I would like to have seen our money working toward the business side of it rather than increasing pay and bonuses," she said.
Foreman finds the bonuses to be excessive and is concerned about the rest of the DLBP's finances.
"This casts a real shadow of doubt on the DLBP," she said.
Foreman also applauded Warren for going out on a limb and making these expenses.
"I would definitely like to see some house cleaning. Maybe it is our fault as merchants for not paying attention to this. We need to take responsibility as well," she said.
Editor's note: Jordan Guinn works part-time at cellardoor.