Commissioner Contemplates Investigation over Missing Half Million

MARGATE - Was it legal for Margate to loan more than a half million dollars in city funds to a non-profit organization without the knowledge of elected officials or the public?

Margate resident, Anthony Caggiano, doesn’t think so. “It stinks. This stinks of criminality at the worst and incompetence at the very best. And we the residents are getting the shaft,” he told elected officials at a May city meeting. Caggiano referred to the more than $500,000 the City of Margate lent the Family Alzheimer’s Center in 2007-2014 for operating expenses. A $75,000 cap agreed upon in 2007 was overlooked and taxpayers are out the balance unless the city can recoup it from the Center. To boot, nearly $900,000 of taxpayer funds was lent the center in years 2000-2007 without the consent of elected officials. (For background read:Margate Loses Half Million Cash. Commingles Funds) It was the second time Caggiano asked for answers. The first was a meeting two weeks prior when Caggiano said he didn’t want to see the half-million matter swept under the carpet. “This silence is deafening. This is my money, this is our money and it’s gone and we want answers,” he insisted. Vice Mayor, Tommy Ruzzano, said he too wants to know how the oversight happened. “Who is the one that wrote the checks to them [the Center] and okay’d it? Ruzzano asked. “Their spending limit went from $75K to $500K. That’s the person that needs to be accountable for this,” he said. Despite the highly suspicious nature of unpaid balances by the Center ranging from a low of $47,137.92 in 2007 to a high of $389,211.17 in 2014, Ruzzano received little support from fellow commissioners or city staff in learning the origin of the mistake. Subsequently, he said he would consider calling for an investigation.

“It’s not about who’s wrong and who’s right here. The problem is $500,000 is missing and nobody wants to be accountable for it,” he told fellow commissioners. Commissioner, Lesa Peerman, said the money isn’t missing, but is rather owed.

“It’s not lost, it’s not wandering around...they [the Center] owe it to us,” she said.

Peerman implicated former City Manager, Frank Porcella, along with the late City/Alzheimer’s Center Lobbyist, Jack Tobin, and suspended Margate Commissioner, David McLean, for crafting the 2007 agreement in question. She said they did it to protect the city after learning the city had lent the Center money for seven years without a contract. “Did it protect the city?” Caggiano asked, noting that the city manager knew about a $300,000 unpaid balance two years after Tobin died. Peerman responded. “I believe that it did protect the city up until the point of Jack Tobin’s death,” she said. “The bills were paid on time properly up until the point of his death.” Peerman referred to Tobin as a master fundraiser who could “pick up the phone and make four phone calls and have a hundred thousand dollars in the city’s hands like that." “Once Jack Tobin died, then you start looking at what happened to the Alzheimer’s Place,” she said. In contrast, records obtained by MargateNews.net show balances above and beyond $75,000 in eight of the eleven years Tobin was a go between for the Center and prior to his death in 2011. In fact, combined overages amount to nearly $360,000 in unpaid balances. Peerman suggested that commissioners at the time knew about the debts, but were afraid to address them for political reasons. Tobin was a force in raising money for city commission campaigns. “Because the Alzheimer’s Center does a lot for Margate residents it would have been a political nightmare. And there were some city managers who wouldn’t do that,” she told Ruzzano. Turns out only about 5% of Alzheimer expenditures went to service Margate residents. Peerman criticized Caggiano for asking city commissioners about the missing money and suggested he call the city manager or finance director to learn instead. “I would think that asking my elected officials whose job it is to supervise these people should be enough of a person to speak to,” Caggiano replied. Commissioner Frank Talerico - who along with City Attorney Eugene Steinfeld was on the dais in 2007 when the agreement was signed - asked Stienfeld whether the financial misstep amounted to a criminal act. “From everything I know there’s no criminality involved,” Steinfeld said, adding that while the City is in negotiations with the Center it wouldn’t wait much longer to file suit. Ruzzano said in the coming week he would be discussing with City Manager, Doug Smith, the pros and cons of filing an investigation into the missing funds. Though he said it isn’t his intent to pin the mistake on any one person, he believes taxpayers deserve to know how and why the error occurred and what controls are in place to stop it from happening again. As far as whether the half million is missing or owed... “It’s gone,” Ruzzano said.