Almond's cool cash

There's no real oversight for the governor's $1.5 million contingency fund, and critics fault a greater emphasis on pet development projects than some other needs

by Steven Stycos

EVERY YEAR, Governor Lincoln Almond gets to spend $1.5 million on whatever he wants. He doesn't have to plead with House Speaker John Harwood or justify his expenses to Representative Antonio Pires (D-Pawtucket), chairman of the House Finance Committee.

This is because the General Assembly annually appropriates the money to the governor's contingency fund. Dating back to at least the administration of former Governor Edward DiPrete, the fund is for "unforeseen and unexpected events," Pires explains. But state law places no restrictions on its use, and the Finance Committee doesn't audit the governor's expenditures, Pires says. The money is in addition to the amount -- currently $3.8 million -- appropriated by the legislature each year to operate the governor's office.

A Phoenix review of invoices shows that Almond used the fund for a grab bag of expenses last year, with heavy emphasis on his pet economic development projects. The fund's largest single expense was $203,118 for a feasibility study for the controversial proposed container port at Quonset Point. Other spending included $75,000 to promote development in Warwick, $40,000 in promotional materials to lure the annual meeting of the National Governors Association to Rhode Island, and even $3500 to purchase a Mr. Potato Head statute for the State House lobby.

Almond used his private stash for social services, helping to finance AmeriCorps VISTA programs to improve reading, and paying for lead removal at day care centers. The governor, who last week indicated that he may challenge US Representative Patrick Kennedy in 2002, also likes to underwrite social events -- he spent $190,825 in fiscal 2000 to finance WaterFire, First Night, a visit by the Tall Ships, and the governor's senior day at Colt State Park in Bristol. And there are a couple of junket expenses buried in the invoices: $8556 in reimbursement to lottery giant GTECH Corporation for use of the company's corporate jet, and $7634 for a 10-day trade mission to Ireland and the United Kingdom.

Joseph Larisa, Almond's chief of staff, calls the contingency fund expenditures a "microcosm" of the budget -- "things the governor views as important to his agenda." Pires has few complaints with the governor's spending choices from the fund. Adds Robert Arruda, chairman of the watchdog group Operation Clean Government, "Based on what you're telling me, it seems the governor is spending money on laudable projects."

But not everyone sees it that way. Maggi Burns Rogers, a member of the Campaign to End Childhood Poverty leadership team, which unsuccessfully sought contingency fund money last year to create summer jobs for needy teenagers, finds fault with some of Almond's spending choices. Instead of funding jobs for 14- and 15-year-olds whose employment prospects were dampened by cuts in a federally funded summer jobs program, Almond pleaded with businesses to employ low-income youths, to little avail. During his two terms, Almond has also spurned the poverty campaign's request for contingency funds to pay for utility bills for poor people and clothing for welfare recipients, Rogers recalls. Overall, she believes the governor spends too much on economic development schemes and not enough to help the disadvantaged.

The $203,118 spent on the Quonset feasibility study, plus the $261,076 spent from the contingency fund in 1998 and 1999 to pay facilitators to supervise the Quonset-Davisville stakeholders project, are evidence, Rogers says, "[that] it's all about big business pipe dreams." Rogers, who has researched Almond's expenditures, also questions why the Rhode Island Economic Development Corporation, which became a quasi-public agency to reduce its reliance on taxpayer financing, is not funding the Quonset expenses from its own budget.

"Unless the governor can turn around and show these investments have turned into real jobs for real people," Rogers says, the contingency fund should be finance social programs, not economic development.

And though they disagree on Almond's use of the $1.5 million fund, Rogers and Arruda agree there should be more public oversight of the spending process. As it stands, citizens can review invoices of expenditures (albeit at an hourly cost of $15) after filing an open records request with state Controller Lawrence Franklin, Rogers notes, but a quarterly summary of spending could make the information more accessible to the public.

Lisa Pelosi, Almond's spokeswoman, defends his outlays on Quonset and other economic development programs, claiming they will bring long-term economic benefits to Rhode Island. Larisa adds that requests for contingency fund money "far, far, exceed the amount we have to meet them."

Larisa also notes that former Governors DiPrete and Bruce Sundlun used much of their contingency funds to hire outside lawyers. Almond, however, hired Larisa, executive counsel Claire Richards, and other in-house attorneys to work on the governor's attempts to prevent legislators from serving on state boards and commissions, and against former state Representative Vincent Mesolella's effort to force the Department of Environmental Management to buy Pascoag Reservoir, Larisa relates. Using the staff lawyers freed contingency money for use on economic development and social programs. "I think the taxpayers are getting a pretty good bang for the buck," Larisa concludes.

Most states have contingency funds, says James Carroll, a regional coordinator for the Council of State Governments, and Almond's spending choices are typical. According to the council's analysis of the different funds, however, Almond has more money to work with than all of the other New England governors. The council's most recent figures show that in fiscal 1999, Maine Governor Angus King was given a $300,000 contingency fund, while the other New England governors were each provided $25,000 or less.

Massachusetts, the region's most populous state, has no comparable fund, says Alda Rego, assistant director of the Massachusetts fiscal affairs division. In "extraordinary" instances, she says, the governor can appropriate additional money to an already budgeted program, but he or she can't, for example, give money to Boston's First Night celebration without legislative approval.

In Rhode Island, the governor's $3.8 million operating budget is occasionally increased to cover unexpected expenses, Pires notes, in the two supplemental budgets enacted by the General Assembly. "We try to make those budgets as tight as we can," Pires says, so the contingency fund may be needed for unexpected expenses at the Rhode Island Economic Development Corporation or elsewhere.

When Almond fails to use the entire $1.5 million, Pires says, the House Finance Committee allows him to carry the money into the next fiscal year. Scooping the money to pay for other expenses would encourage the governor to spend it at the end of the year on less than crucial items, Pires notes, rather than leaving the money to be returned to the general fund. The annual state budget bill suggests the fund may be used for "emergencies" or "unforeseen conditions," but permits expenditures for any item, as long as the governor and his director of administration have approved it.

Here's a summary of Almond's major contingency fund expenditures in fiscal 2000:

* Quonset Point ($203,118). After a developer proposed to build a huge cargo port at the former Navy base, Almond paid a consulting firm $350,000 to evaluate the proposal. The Rhode Island Economic Development Corporation (RIEDC) supplied $150,000, and the rest came from the contingency fund.

During the previous fiscal year, the fund provided $261,076 to pay Mediation Consultants of Providence to run the stakeholders' project. The stakeholders' process, which consisted of 10 meetings in 1998 and 1999 of environmentalists, labor leaders, business executives, and others, unsuccessfully sought to develop a compromise plan for Quonset. Although the process failed, Mediation Consultants' J. Michael Keating and Kathleen Birt were respectively paid $220 and $150 per hour for their efforts, according to contingency fund invoices.

Larisa defends hiring the consultants, saying it was "well worth the money and effort to bring the environmental community and the business community together." Almond wanted "an open participatory process," Larisa adds, but there was no other money for it, so the contingency fund was used.

Pires isn't critical of the expenditures, noting that when Massachusetts officials were trying to convince the Pawtucket Red Sox to move to Worcester several years ago, the contingency fund paid $75,000 for an architectural study of possible expansion of McCoy Stadium. Rogers, however, calls the Quonset expenses "grotesque." Referring to the bill for Mediation Consultants, she adds, "It definitely created jobs for them."

* Social events ($190,825). Almond used his contingency fund to make sizeable contributions to five social events: WaterFire ($57,841); First Night ($44,893); the visit last summer of the Tall Ships to Newport ($50,150); the governor's senior day at Colt State Park ($26,069); and the State House Centennial Ball ($14,007). Almond contributed a single sum of $50,000 to WaterFire, and also paid for the sound system, chair and table rentals, a Rose Weaver performance, a stilt walker, and a clown during one WaterFire in October. First Night 1999 expenses included paying three lighting technicians $1000 each for a laser show, plus $6000 for fireworks. The City of Newport was reimbursed $50,000 to cover less than half the cost of police, fire, and sanitation services related to the Tall Ships visit. Another $16,000 was given to Tall Ships Newport Inc. from this year's contingency fund.

Fiscal 2000 expenditures for the governor's senior day included 54 cases of bottled water ($324), a banner ($150), buses ($3300), portable toilets ($900), and food ($15,075).

The May 2000 State House Centennial Ball raised $255,000 for State House renovations, according to Sheila McDonald, who coordinated the event for the nonprofit State House Restoration Society. The contingency fund paid Quality Rental Center in Pawtucket to rent the tent, tables, and chairs that were set up on the Smith Street plaza. The fund also contributed $2500 for fireworks.

* Senior information specialists ($153,000). Feeling strongly that Rhode Island's senior citizens needed help using the Internet, Almond used the contingency fund to hire computer-savvy staff for the state's senior centers, says Pelosi. The program is now supported by the annual state budget.

* AmeriCorps VISTA ($142,650). Since 1994, the contingency fund has paid a major portion of the Rhode Island Service Alliance's administrative expenses. The alliance oversees a $4 million program that provides low-paying public service work for high school graduates in exchange for financial assistance in college. Best known is AmeriCorps VISTA's City Year Rhode Island, whose red-jacketed participants clean public lots and supervise youth reading programs, among other efforts. The contingency fund paid for half of the alliance's administrative budget in 2000, and Almond contributed the same amount to the program this year, records show.

* Central Falls Teaching Institute ($125,000). The institute uses mentors from around the state to train teachers in Central Falls. Almond agreed to finance the pilot program, hoping that other communities would imitate it, Pelosi says. The money pays primarily for substitute teachers so that mentors can assist in other classrooms, according to Linda Celona, business administrator in Central Falls. Almond also spent $125,000 on the program in 1999.

* Governor's reading initiative ($127,000). Almond paid $100,000 to Atkins Marketing & Design, a Connecticut public relations firm, to manage public relations for his campaign to have all Rhode Island children reading by the fourth grade. The money went to produce public service announcements with Today show host Matt Lauer, design a campaign logo, print bumper stickers, buy T-shirts, and organize special events.

An additional $27,000 helped start Rhode Island Reads. Initiated by former Lieutenant Governor Bernard Jackvony, the program offers after-school and school-based literacy programs for grade school children at 20 sites, according to Margaretta Edwards, executive director of the Public Education Fund. More than $400,000 in annual funding, plus a coordinator for every center, is supplied by AmeriCorps VISTA.

* Lead removal at day care centers ($90,000). The contingency fund gave $90,000 to the Rhode Island Housing & Mortgage Finance Corporation to make day care centers lead-free. Rogers cites this as one of the best contingency fund expenditures.

* Warwick train station development ($75,000). Almond's contingency fund directed $75,000 to the RIEDC to conduct a nationwide search for companies to develop the area around the proposed train station near T.F. Green Airport, on Amtrak's Northeast Corridor. Basile Baumann Prost & Associates, a consulting firm in Annapolis, Maryland, found three candidates to develop the proposed station district, and then, Pelosi says, the winner was selected by the City of Warwick.

* Renovations of the governor's office ($58,124). In the most criticized expenditure, Almond spent thousands for electrical work ($6736), carpeting ($4330), computers and scheduling software ($30,277), bookshelves and a walnut topped desk ($1072), air conditioning ($5990), and general renovations ($9719) for first floor offices at the State House.

"Unspeakably extravagant when there are people sleeping on the floor at Traveler's Aid," says Rogers. The use of contingency funds on office renovations and furniture also bothers Pires. "I'm not going to chastise him [Almond] for that," Pires says, "but that belongs in [the] operations [portion of the budget]."

Pelosi defends the spending, noting that Almond secured $100,000 in last year's supplemental budget for emergency shelter space at the Salvation Army in Providence, and used $25,000 from the contingency fund this year to help keep open the Harrington Hall shelter in Cranston.

* Disability consultant ($40,000). Almond used the contingency fund to hire consultant Thomas Hehir to evaluate Rhode Island's early intervention program for children with disabilities.

* Promotional campaign for National Governors Association conference ($40,000). The money was paid to RIEDC and the Providence-Warwick Convention & Visitors Bureau to bid for the 2001 meeting of the National Governors Association. The effort paid off, says Pelosi, and the governors will be coming to Providence in August.

Sports events ($33,329). Almond paid $20,000 for an April 2000 reception and banquet at the NCAA Frozen Four college hockey championships, which were held at the Providence Civic Center. He also paid $9669 to the Rhode Island Disaster Medical Assistance Team to stand by when the Snickers Eastern Regional Soccer Championship was held at the University of Rhode Island. Another $3650 was spent to rent a tent, tables, and chairs for a VIP reception at the youth soccer tournament.

* Jewelers expo ($25,000). The contingency fund was used to reimburse the Manufacturing Jewelers & Suppliers of America for holding an exposition in Rhode Island in May 1999. The expo costs help an important local industry, Pelosi explains, and were unanticipated.

* Funeral for Senator John Chafee ($14,187). Almond used the contingency fund to honor the man who elevated him to political prominence by appointing him US Attorney for Rhode Island. The fund paid for flowers, coffee, and pastry for a memorial to Senator Chafee at the State House, and chairs, stanchions and a tent at the funeral service at Grace Church.

* Destination Providence campaign ($12,155). Funneled through the Greater Providence Chamber of Commerce, this money contributed to a public relations campaign to attract tourists to Providence.

* Miscellaneous expenses ($84,303). Included in this category are a variety of items, including an $8556 payment to GTECH Corporation to fly Almond, his wife, chief of staff Michael DiBiase, David Darlington, special assistant to the governor, and two state troopers to the National Governor's Association summer 1999 meeting in St. Louis.

Scheduling problems made the use of commercial airlines difficult, Pelosi says, so Almond requested the GTECH plane to get to the meeting and make the pitch for Providence to host the 2001 governors' meeting. GTECH was reimbursed based on the equivalent in first-class fares, Pelosi says.

The contingency fund also paid $7634 toward a BankBoston-sponsored day trade mission to Ireland and the United Kingdom. Almond and his wife took the trip, but, according to Pelosi, their fares and expenses were paid by the Rhode Island Commodores, a business group. The contingency fund paid for Darlington and state troopers David Tikoain and Scott Hemmingway to attend. Pelosi can point to no specific benefit from the trip, but she says economic development projects often take time to succeed.

Other expenses included a $3060 "1/2 day consulting fee" for Canadian affirmative action consultant Trevor Wilson; $5075 for the photographs in the computerized presentation of Almond's 1999 budget address to the legislature; $1200-a-day consulting fees for Charles Mojkowski to advise the Education Finance Task Force; $4817 to the Providence law firm of Partridge Snow & Hahn LLP for advice on dealing with the Narragansett and Pokanoket Indian tribes; $2400 for three banners with the state seal; $1110 in moving expenses for Jan Reitsma, director of the state Department of Environmental Management.

Also, $1293 to Brewed Awakenings for coffee at judicial appointment press conferences; $1575 for diversity training for 40 top state officials at the University of Rhode Island's W. Alton Jones campus; $3853 to buy three sound systems; $3500 for the Mr. Potato Head statute of "Colonel Hedley Russet" in the State House foyer; $2000 to provide meals and room rentals at the Rhode Island Children and Poverty Summit at the Sheraton Providence Airport Hotel; $2820 for a retreat for the governor's staff; and $1416 to charter the schooner Aurora for a 90-minute staff cruise in Newport harbor.

Also included were payments for ads in the New York Times, Wall Street Journal, and other newspapers to seek new directors of the RIEDC and Department of Corrections, and travel expenses for job applicants.