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Annapolis Asks For Money

| December 14, 2010, 11:25 PM | 11 Comments

UPDATE 11:26pm, 12/14/2010: We just received an email from Alderman Paone (R- Ward 2) who advised that he had not seen the letter until it was sent to him by Eye On Annapolis.

If you have a little change to spare this holiday season, the City of Annapolis is interested in it.

We obtained a copy of a letter distributed to local businesses and residents by Annapolis Mayor Josh Cohen seeking donations to help out the city.

Annapolis fundraising letter

There are many things that do not sit right with this letter. First of all, who is “Business Partnership Annapolis?” They are not a registered entity in Maryland according to the State Department of Assesments and Taxation. Is this a non-profit organization? A Political Action Committee? A private business?

Why is the Mayor soliciting outside funds for items that historically were handled within the confines of the annual budget? Is our spending so out of line with the budget that we need to beg for money from local businesses?

But, most troubling are the requests for a City Special Projects Fund to provide a picnic for employees and The Cohen Fund to respond to requests for charity.

When businesses are weathering the recession and cutting back on employee perks (many companies, if not most, no longer provide full coverage health care for their employees), the City is planning summertime picnics. Just this afternoon, the Mayor tweeted

Enjoyed hosting the holiday party for our hardworking #Annapolis City employees. Thank you for your dedication during these difficult times.

But tomorrow morning, he will hold out the City’s hand begging businesses to pay for this event.

We contacted the Mayor’s office this afternoon to see if we could get some answers and unfortunately they were few and far between. Phill McGowan, the Mayor’s spokesperson said that this was being held in order to ask supporters for a contribution one time rather than going back multiple times throughout the year asking for support. (See McGowan’s email below)

When questioned about the various funds, some of which are tax deductible and others are not, McGowan advised that the City is seeking a “title sponsor” for the New Years Eve celebration planned this year at a cost of $20,000. Additionally, they are looking for $10,000 to sponsor a “Legislative Reception” welcoming state lawmakers back to the City. $20,000 for the Fourth of July celebration. The reception is being handled by Capitol Strategies, a registered lobbying firm whose address is the same as that of this “Business Partnership Annapolis.” Incidentally, the email address for Capitol Strategies included in the letter is incorrect and directs to a New York based venture firm.

Regarding the Special Events Fund, this is for employee luncheons, City Hall Open Houses and other “non-budgeted” items.

Perhaps most disturbing is the Cohen Community Fund. This is specifically not affiliated with the City and will be used to support area non-profits identified by the Mayor. It appears the Mayor, in essence, has set up a private foundation in his name and is looking to have local businesses and supporters fund it.

In past years, there were line items in the budget where the City supported local non-profits. With the economy, the amounts have been severely curtailed (as expected) but running this through a non-City affiliated charity controlled by the Mayor does not seem right.

McGowan advised that the Mayor would address any concerns at the meeting or after the meeting by phone.

We sent emails to all eight Aldermen this afternoon regarding this new initiative and did not receive any response. If anyone responds, we will be sure to make an update.

Text of email received from Phill McGowan, spokesperson for Annapolis Mayor Josh Cohen:

For your background:

The mayor is holding a unique fundraiser at 8:30 a.m. tomorrow (Wednesday) at the Loews Annapolis Hotel. This free breakfast event is an opportunity to raise funds for City events and other causes. Many business and community leaders are expected to attend, and the media is invited. The idea of the event, according to Mayor Cohen, is that during these tough economic times, the City needs to find ways to raise the funds to put on important events that well represent the state capital without seeking to raise fees or taxes. In the past, businesses have been inundated with requests for donations. The mayor views this fundraiser as an opportunity to generate funds for several events extending well into next year. The event is being coordinated by Capitol Strategies and the Mayor’s Office.

For those who can attend, the mayor is happy to speak with you about it on-site. For those who can’t, he can follow up with an interview by phone.

Below is the list of the funds for which donations are being sought. Donations to the City of Annapolis and the Cohen Community Fund are tax-deductible.

I am out of the office on Wednesday. Media inquiries should be directed to Rhonda Wardlaw: [email protected] or 410-562-8970.

Legislative Reception Fund
Title Sponsor $10,000
This annual event is the signature welcome event for returning Legislators on the opening night of the Legislative Session.  Held at the iconic Governor Calvert House and co-hosted by Speaker Michael E. Busch, this isalways a well attended and enjoyable event.

The costs associated with hosting this event are not tax deductible and are paid for by donations to theAnnapolis Welcome Group.  This is aprivate fund managed and administered by Capitol Strategies LLC, a registered state lobbying firm.  It is not affiliated with the City of Annapolis government.

Annapolis New Year’s Eve Fund
Title Sponsor $20,000
As the Capital City, there is no better place to enjoy fireworks and ring in the New Year. The Annapolis community has come to look forward to Downtown turning into a festive place to enjoy New Year’s Eve.  The average attendance for this event is 5,000. This fund pays for costs associated with fireworks, entertainment, and logistics such as tenting. Contributions to this activity are tax deductible and are payable to the City of Annapolis.

Annapolis July 4th Celebration Fund
Title Sponsor $20,000
The 4th of July inAnnapolis has become synonymous with parades, fireworks, and represents one of our greatest American holidays. This fund covers the costs associated with fireworks and a parade. Contributions to this activity are tax deductible and are payable to theCity of Annapolis.

City Activity Fund
There are often events or projects that arise that are not budgeted into the official City budget.  Projects such as employee luncheons,senior health forums, and City Hall open house are typically paid for using outside funding.  These types of events are important to keeping traditions and maintaining the spirit of City Government.  Contributions to this activity are tax deductible and are payable to the City of Annapolis.

Cohen Community Fund
Mayor Cohen established the Cohen Community Fund as a charitable fund through the Community Foundation of Anne Arundel County.  It is not affiliated with the City of Annapolis government. Its purpose is to support area non-profit community initiatives and charitable activities identified by Mayor Cohen in consultation with an advisory board. Contributions to this fund are tax deductible. Donations should be made payable to the Community Foundation of Anne Arundel County and designated for the Cohen Community Fund.

It should be noted that the invite to attend the breakfast to Eye On Annapolis was only made after we had made an inquiry about the letter.

All of these items, in years past, were handled by the budget. This mid year plea seems to indicate that the budget is not as “on track” as expected. The Mayor campaigned on not raising taxes or fees and this seems like an attempt to keep that promise. It may work in the short term, but what does it say when a City needs to beg for money to bridge a budget gap?

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About the Author - John Frenaye

John is the publisher and editor of Eye On Annapolis. As a resident and business owner in Anne Arundel County for nearly 25 years, he realized that there was something missing in terms of community news–and Eye On Annapolis was born in late spring 2009.

John’s background is in the travel industry as a business owner, industry speaker, and travel writer. In terms of blogging and social media, he cut his teeth with MSNBC.com.

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Comments (11)

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  1. Fred Shubbie®™© says:

    P McGowan says : ” I am out of the office on Wednesday. Media inquiries should be directed to Rhonda Wardlaw: [email protected] or 410-562-8970.”

    Again, the City seems to be handling the Citizens money in a very irresponsible manner. So what’s the deal with Rhonda and Phill are they playing good cop- bad cop ? , the bad one drops the bomb and the good one spins the top. Seems like a redundancy problem. Why don’t we merge the positions into one and eliminate a position and wallah, no need to beg sweet darlin’ for money to Welcome Legislator’s back to Annapolis– and for those other frivolous items, Oy Vey !!

    Does it not seem ridiculous for the City Government to ask the local businesses that are dependent on the Legislators for dollars to use the City as a middle-man, I’m certain the businesses will warmly welcome each and every one. It’s all so very , very irresponsible and ill-conceived.

    Thanks John , this is interesting to say the least!!

    Rock On !!!

  2. Fred Shubbie®™© says:

    With regard to the Legislative Reception Fund : On 2nd Reading it is clear Phill is acting as a shill for a third party not affilitate with the city government , he is in effect lobbying for a lobbying group .

    It just doesn’t pass the sniff test. It seems …….well irresponsible in a way. Almost Machiavellian.

  3. Bill Kardash says:

    The assertion that “contributions to the City are tax-deductible” is not accurate. The City is not a qualified charity under sec 501(c) 3 of the IRS Code. A similar misstep happened last year when the Mayor was soliciting “tax-deductible contributions” for his inaugural party. That fund-raising effort was cancelled when it became obvious it wasn’t allowed. Any business who sends a “contribution” is really just incurring a “business expense”. These expenses are not “tax-deductible” .. they are (just) deductible against revenues. But “tax-deductible” has a nice sound to it and sounds more community-spirited. The handling of donations to the “Cohen Community Fund” is interesting. Contributions are tax-deductible, because they are being channeled through the Community Foundation of Annapolis, but why should they be set aside for the Cohen Fund? Why not just say “I’d like these funds to be used for education, or feeding the homeless, etc.” If the Mayor wants to support a program for which funds are not presently available, why not change priorities or cut spending in one of areas where funds are being wasted?

  4. John Frenaye says:

    Bill, I was looking through past emails and I believe that the Inaugural was initially set up to go through this Community Foundation and advertised as tax deductible. It was deemed “illegal” and the revision went out saying that they could not comply with the state and federal requirements and the donations were ultimately funneled through the City but they were not tax-deductible as you say. I suspect that the Foundation is restricted in their funding; and funding a political party likely does not fall under the umbrella since it was not a fund raiser (per se), nor was it an event to benefit any charitable organization.

  5. laura says:

    I believe this is illegal under the MAryland code, especially the part about the Cohen Fund.

    I does seem ripe for abuse, how would the City impartially regulate any of the businesses that contribute? Doesn’t the plea fir contributions for items to benfit city employees scream “special favors?”

    At a minimum, it is abuse of office, this state has a regulations similar to the one that tripped up Charlie Rangel – you cannot use the guise of public office to solicit funds that may incur a benefit to the officeholder. Cohen collecting funds from private entities reeks of currying favor.

  6. Fred Shubbie®©™ says:

    I think Phill needs to step aside for a month or two , take a furlough and in his place The City Attorney can address some of this contentious issues. She is an HLS graduate and no doubt incredibly well-spoken , responsible and straight-forward in her communications. Why do we even need Phill, let’s eliminate his job and replace him with the City Attorney. She is under-utilized as it is and with her credentials and her ability to see through the cloud of politics and obligation to protect the city’s interest I propose her salary be increased to market rates for a woman of her caliber. I think DLA piper Associates made about $170 before the salary cuts and bonus rule changes. In these tough times we need a spokesperson that can break down apparently complex issues and offer clear, UNEQUIVOCAL answers. It is irresponsible to continue to use a man like phill Mcgowan, who is ill-equipped and unavailable to handle the complexity of the job of a PIO in today’s world.

    Thank you .

    PS. I wonder what Dick Hillman thinks about the MarketHouse fiasco ?

  7. Bob McWilliams says:

    This does feel a little uncomfortable. It may all be above board, but it kind of smacks of pay to play. The “Cohen Fund” makes the line between City business and campaigning especially fuzzy.

    The first thing I’d eliminate is the $7,000 legislator lunch. I’m sure they have plenty of cocktail parties to attend. The City of Annapolis doesn’t need to spend $7,000 on lunch for a bunch of pampered politicians.

    Since the City’s broke, perhaps they could brown bag it or have a pot-luck event like the rest of us. Instead of having the usual martini thing at the Lowe’s Hotel, such an act of symbolism would be good for them. I understand the lobbying aspect of this event. But, when you’re borrowing money and firing employees, parties should be the first thing to go.

    Besides, if we don’t buy them lunch are they going to hold the general assembly in some other town!

  8. John Frenaye says:

    Inserting tongue in cheek: They should have invited the legislators to the “free” breakfast this morning and it would not have cost anything.

  9. Bob McWilliams says:

    Or, maybe Bush has some money left over in his campaign fund, and he can hold another fish fry – like the one’s he had during the election.

    During the election guys like Busch buy votes with a free lunch. Now, I guess they thing it’s our turn to to buy their vote with another free lunch.

  10. Bill Kardash says:

    An attorney friend says that sending contributions to the Community Foundation of Annapolis (an approved 501 (c) 3 foundation) who would, in turn, give the money to the Cohen Fund, an unapproved organization, would not be allowed and could jeopardize the non-profit status of the Community Foundation. It seems the Cohen Fund should file for its own non-profit charter. Better yet, we respectfully suggest that the Mayor abandon this poorly-conceived (and executed) idea and, instead, just encourage donors to support the Community Foundation. Of course, this has less political grand-standing value.

  11. Running with Scissors says:

    Why does the Patrick Swayzee movie Roadhouse come to ming reading this story? Josh playing the Brad Wesley part.

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