City Neglects to Explain Major Accounting Error. Taxpayers out $800,000


​After losing track of a half million tax dollars misappropriated to a local charity, city officials continue to be tight lipped over how it happened. To make it go away, city commissioners recently agreed to settle with the charity by giving it $312,000 in exchange for assets. “I’m tired of hearing that pointing fingers doesn’t do any good. Yes it does. It lets others know that when they mess up, they will be held accountable. There are no people being held accountable for this. None. Not a single person is being held accountable for this,” Margate resident and city commission candidate, Anthony Caggiano, told city commissioners at their twice-monthly meeting. _____________ Caggiano has asked publicly numerous times how the city could have overlooked a fiduciary arrangement it had with the Alzheimer’s Family Center in Margate (Center). An arrangement that began as a handshake in 1986 and wasn’t documented until 2007. Important for Caggiano was how or why the agreement happened in the first place. “This was a once in a lifetime deal that no other business or charity in this city got, and that is costing taxpayers over a half a million dollars and the tally is only going to continue,” he said. The deal Caggiano referred to was an informal agreement made in 1986 between the Alzheimer’s Family Center and the City of Margate where the City would provide bookkeeping and depository services for the Center. The agreement, which resulted in an undisclosed fiscal impact to taxpayers, was seemingly orchestrated at a time when the Center was originally approved by city commissioners to be constructed on the 600 Block of Rock Island Road, a half-acre greenspace deeded to the City as a park. News reports from the Sun-sentinel and Miami Herald indicate that the city commission directed City Attorney, Eugene Steinfeld, to ask a judge to circumvent the park’s deed restriction to allow for the building. "We don't anticipate any problems," Margate Commissioner, Benjamin Goldner, said in 1987.[1] At the time, it was reported that State Representative, Jack Tobin (D-Margate) secured $175,000 a year for five years from the state as startup money for the Center after failing to get approved for $1 million by the legislature to construct the building. “Until building money can be raised from public and private sources, the Family Center group will use the annual state money to provide care for victims and education for their caretakers through a storefront operation,” board member Becky Schweyer said in a report.[2] The storefront address was 1029 N. State Road 7. [3] In 1988, Margate city commissioners agreed 5-0 to allow the Center to use the greenspace for $1 a year for 99 years.[4] Two years later, it was reported that a priority for Tobin was to raise $100,000 for an Alzheimer’s center.[5] At this point, the Center continued to operate out of an unnamed storefront on State Road 7 and the building on the 600 block in Margate was dead in the water. Ultimately, the greenspace would be occupied by the Margate Fire Department and used for a portable office trailer. Come 1991, state lawmakers failed to provide funds for the Center, along with other legislative pet projects.[6] Fundraising efforts for the Center seemed to get off the ground in 1994 - eight years after Margate claims it funded the center annually. Tobin held a luncheon in Pompano that attracted more than 500 guests and raised $35,000 in a single event. In attendance were Broward elitists, politicians and a gaggle of top judges [7] - a sign that the Center could survive on the heels of fundraising efforts and at the same time provide a platform to advance political careers. From there, the Center began to raise money through high-ticket galas, luncheons, golf tournaments and dedicated beneficiaries. The annual Holiday Fantasy of Lights at Tradewinds Park in Coconut Creek - an Alzheimer’s fundraiser - would contribute 42 nights out of the year.[8] Finally, after 14 years of funding the Center, Margate was acknowledged in the press for its support. It could be the first time the public was made aware. “The center is recognizing Margate for years of support. The city has maintained the center's payroll, general ledger and financial and investment records,” reported the Sun-sentinel in 2000.[9] That same year, Margate provided the center with $80,000 in funding - the first year after 14 the City acknowledged funding the Center in their books. From this point, the Center was rarely covered by the press with the exception of fundraising efforts. Seemingly flush with cash in 2004, the Alzheimer’s Family Center would purchase its first building for $560,000 at 6280 W. Atlantic Boulevard. Tobin would broker the sale privately. The Center owed the City $151,000 at the time and Tobin was a lobbyist at Margate City Hall, which made him tight with elected officials and staff. Undeniably, Tobin had pull at the time. Come 2006, the Center’s debt to the city exceeded $280,000. (Click to view chart) In 2007, city commissioners formalized a funding agreement that included an annual cap of $75,000. Once the Center exceeded the cap, the city could halt funding until paid back. The agreement was drafted by Steinfeld and approved by city commissioners (4-0) on a Consent Agenda at a July city meeting. Commissioner, Frank Talerico, was among elected officials on the dais. Typically, Consent Agendas are for housekeeping items - not for large expenditures or budget amendments. Over the next eight years, various city commissioners would sit on the Center’s board and buy tables to fundraisers. In 2015, elected officials learned that the Center was in debt to Margate for more than a half million dollars. Where's the money? asks Caggiano. Fundraising efforts were successful; the Center bought a building and by this time the city had provided substantial funding for nearly 30 years. “I’m not happy about any of this either, I was a very trusting soul at the time, I thought everything was being taken care of,” Talerico said at a recent city meeting. “Everyone on this commission back then was behind that Center, the public was behind it. It had a good service record.” Notably, the Alzheimer’s Family Center provides caregivers of Alzheimer’s patients with support. Executive Director for the Center, Joyce Karney, told MargateNews.net that she didn’t know how the debt occurred. As bookkeepers for the Center, she relied on the City to keep track of the debt and make adjustments to ledgers as needed. For Caggiano, he wants to know why the city committed funds to the Center in the first place, and then attempted to cover up an insurmountable debt. “Let’s not forget that the public still hasn’t gotten any answers from the city attorney as to why he allowed this deal to happen and the current city manager who knew about this gaping wound at $300,000 and said nothing about it,” said Caggiano, moments after the city commission awarded the two pay raises at a city meeting. “It’s my money; it’s all the people in this room’s money. We deserve answers.” Caggiano doesn’t want to see the financial faux pas swept under the rug. The city should conduct an investigation into who and how the money was misappropriated and lost. He cited evidence the city manager knew of the rising debt in 2013, but failed disclose it to elected officials until it reached a half million dollars two years later. “Why he allowed it to continue. The bleeding, until it got to $500,000, we still don’t know,” Caggiano said. “This means that this fiduciary irresponsibility can easily happen again.” To further exploit the matter, the City is attempting to collect on the debt by throwing good money after bad, said Caggiano. City commissioners, sitting as Directors for the Community Redevelopment Agency (CRA), agreed to commit $312,000 of TIF dollars to buy the Center’s building and property as means to settle the debt. Chair to the Agency, Frank Talerico, in office for 22 years, voted in the affirmative for the settlement both as a city commissioner and a director for the Agency. Caggiano implicated Talerico in failing to watch after tax dollars. “That commissioner under the guise of the CRA Chairman wants to quell the uproar by buying the property and sinking possibly more ‘good taxpayer dollars after bad’ and kicking the problem down the road a decade,” Caggiano said of the asset, which the CRA will be using for office space instead of selling it for cash and recouping taxpayer losses. “To compound this economic sinkhole...,” he continued. To date, the City has chosen not to answer questions posed by the public regarding who was involved in losing track of the massive debt or where the accounting process failed. Caggiano has asked both city staff and elected officials and hasn’t got an answer. He wants someone held accountable, including those responsible for the cover up. “The things you do when it’s not your money,” he told commissioners. Commissioners voted 4-1 to settle the Center’s debt by purchasing the Center's building and property, the market value of which is $492,000 - Vice Mayor, Tommy Ruzzano, in dissent. Ruzzano said he wasn’t happy with the terms of the settlement, including a $200 monthly rent provided to the Center through December. Moreover, he didn’t think the City should pay for inspections, surveys or closing costs. “It’s a slap in the face,” he said.

[1] CITY SEEKS OK TO DONATE LANDMiami Herald, The (FL) - October 23, 1987

[2] ALZHEIMER'S GROUP WINS CENTER SITESun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) - August 20, 1987

[3] NEW ALZHEIMER'S CENTER LENDS A HAND PROFESSIONALS COME IN, GIVE THE USUAL CARE-GIVER A REST Miami Herald, The (FL) - February 27, 1988

[4] ALZHEIMER HEARINGS TO BE HELD MARGATE TO DONATE LAND FOR $2 MILLION CENTER Sun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) July 7, 1988

[5] BRWD N Miami Herald, The (FL) - April 1, 1990

[6] BROWARD SCHOOLS' SEVENTH PERIOD MAY SURVIVE - WHAT PASSED - EDUCATION - ECONOMIC DEVELOPMENT - CONDOS - NEW TAXES AND FEES - GOVERNMENT - ETHICS AND CAMPAIGN REFORM - CRIME, COURTS & DRUGS - ENVIRONMENT - FAMILY ISSUES - HEALTH CARE - MISC. Sun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) - MAY 3, 1991

[7] POMPANO LUNCHEON AIDS ALZHEIMER'S FIGHT Sun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) - November 9, 1994

[8] CHARITIES LOSE AS DONATIONS GO TO N.Y. AID Sun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) - September 28, 2001

[9] AUTUMN FEST LUNCHEON IS SET - ALZHEIMER'S CENTER TO THANK ITS SUPPORTERS Sun Sentinel (Fort Lauderdale, FL) (Published as Sun-Sentinel) - October 29, 2000

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