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'Newbo evolve' on radar of incoming auditor

Rob Sand stops short of committing to full investigation

Newly elected State Auditor Rob Sand speaks early Nov. 7 at a Democratic election night party in Des Moines. (Stephen Mally/The Gazette)
Newly elected State Auditor Rob Sand speaks early Nov. 7 at a Democratic election night party in Des Moines. (Stephen Mally/The Gazette)
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CEDAR RAPIDS — Iowa’s incoming state auditor, who campaigned on restoring a “watchdog” focus to the office, said he plans to examine GO Cedar Rapids, the former tourism bureau that lost $2.3 million putting on a summer festival called “newbo evolve” and left a string of debts.

Rob Sand, a Democrat who defeated Republican incumbent Mary Mosiman this month, stopped short of committing to an investigation but said the matter is on his radar, he would look into it and he would seek more information when he takes office in January, he told The Gazette in a phone interview.

“I’m not sure what I would need to see,” Sand said. “It’s hard to answer because of how many factual permutations there are that would make one want to investigate. If there hasn’t been a public accounting of where the money went and there are questions of where the money went, that is an example where the public deserves more transparency. The state auditor’s office can provide that transparency.”

GO Cedar Rapids folded in October, leaving $800,000 unpaid to newbo evolve vendors, $1.5 million owed to Bankers Trust for a line of credit and $38,750 collected on behalf of the separate Haunted Halloween Ball event that went missing without explanation.

The city has declined to step in and pay the vendors, many who have not been publicly identified, but did pay the bill for the Halloween Ball.

The city, which is a separate legal entity from GO Cedar Rapids, created a new Cedar Rapids Tourism Office that is being funded by public hotel-motel tax dollars formerly earmarked for GO Cedar Rapids.

Other questions exist over just who is owed money and how much, who received 3,804 free tickets to see festival headliners Kelly Clarkson and Maroon 5 and whether proper oversight was provided.

Despite promises by the GO Cedar Rapids board to conduct an independent audit and make the results public, no public investigation has occurred.

Sand was critical of former rival Mosiman for not doing more.

“I was running against someone who looked at something like newbo evolve and unless someone asked her, she wouldn’t look into it,” he said. “We ought to have someone in this office willing to look into things like this without being asked.”

The city of Cedar Rapids could have requested an audit but has not done so, deputy auditor Andy Nielsen said. An audit also can be requested by petition with 100 signatures but one has not been submitted, he said. The audit would be limited to the scope of hotel-motel tax involvement, but if other issues were found those could be referred to another agency, Nielsen said.

Cedar Rapids had been the primary funder of GO Cedar Rapids since its inception in the early in 1980s, including investing $1 million annually in recent years in hotel-motel taxes.

“Any time taxpayer money is being spent, the public deserves answers as to whether the money is being spent appropriately,” Sand said.

Cedar Rapids Mayor Brad Hart has said previously he wouldn’t seek an audit because a financial review was conducted by Jim Haddad, who served as interim chief executive of GO Cedar Rapids after former chief executive Aaron McCreight was fired for his role in newbo evolve.

Haddad “reviewed the records and did not find any evidence of funds going where they shouldn’t go,” Hart said. “The ticket sales were nowhere near what was needed to pay the expenses. It is that simple. … What would an investigation reveal other than (ticket sales and sponsorships) fell far short of predictions?”

The board of directors of GO Cedar Rapids and city officials have blamed the losses on McCreight and community events director Scott Tallman, who also was fired, saying they misled the board with inflated ticket sale and sponsorship information and spent beyond what was approved.

l Comments: (319) 398-8310; brian.morelli@thegazette.com

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