Seattle Courant Archive

Busted for that Hot Dog Bash

Busted for that Hot Dog Bash

By Aimee Curl
November 26, 2008

The organization, one of Seattle's eight public development authorities, is a public corporation whose board is appointed in part by the mayor and is beholden to state and municipal ethics laws when using public dollars. (Though most of CHHIP's $5.2 million operating budget comes from the rental income of its 42 buildings— located primarily on Capitol Hill— the organization also receives city funds and private donations, which can only be used for public purposes.) The state auditor's office slapped CHHIP with a finding in its audit of the organization, released earlier this month. The state will follow up in a future report to ensure the public development authority doesn't repeat the blunder.

The auditor said the fete, which totaled $3,144, was not a valid public use. Making matters worse, according to the report, CHHIP asked for donations from current and past vendors to pay for the party— something the auditor says had the appearance of a conflict of interest.

"Public officials should not be out there soliciting money for parties from people they do business with," says Mindy Chambers, a spokeswoman for State Auditor Brian Sonntag. She adds, "You're also not supposed to spend public dollars on alcoholic beverages. Plus, it was a private party. They didn't invite the pubic."

Instead of blowing the cash on hot dogs, CHHIP actually could've thrown a much more lavish affair. The fundraising effort yielded $14,712. Chris Persons, CHHIP's executive director, says the remainder of the money went to the organization's general operating budget. "We find it very curious that an event that raised essentially four times what our costs were can be found to be non-compliant." Persons says.

In its official response to the audit, CHHIP argues that the event was modest: 220 attendees at a cost of $14.29 per person, and that it was a valid use of public money to celebrate the organization's accomplishments during the former executive director's tenure. On the conflict of interest charge, Persons also defers to the organization's written response: "Contributions were solicited from businesses that work in the affordable housing community and are known to be supportive of affordable housing. No benefit was offered in writing or verbally to any contributor other than the personal tax benefit that might apply."

This isn't the first time CHHIP's been in hot water with the state auditor. In 2005 the organization was found to lack internal controls over key financial systems, a basic audit requirement. In 2004, the state reported CHIP failed to complete annual inspections on its buildings in time in time to comply with quality standards for federal grant funds. And in 2003, a volunteer finance coordinator was charged with not only cooking the books, but destroying them.