State audit blisters Port Richey’s redevelopment agency

PORT RICHEY — A state audit has confirmed mismanagement allegations stretching back years within the city’s community redevelopment agency.

The scathing report issued last month by the Florida auditor general found that the agency used money dedicated to fixing blight in the city to pay for other things, such as the salaries of City Council members, police and fire officials. And it put an undue share of the cost of fixing city problems on Pasco County government for two years.

The audit also found the geographic boundaries of the area served by the agency are overly broad, taking in the entire city, including neighborhoods where values have risen sharply. The result is that tax money meant to encourage redevelopment of neglected areas is subsidizing city services in parts of the community that don’t need the extra attention.

Port Richey established its redevelopment agency in 2002. The program exists in Florida to focus spending of tax dollars in specifically defined blighted areas to encourage private investment and renewal. Funding comes from the increase in property taxes as values climb or redevelopment takes place within those boundaries. For the Port Richey Community Redevelopment Agency, the city and Pasco County each contribute money from the increase in tax revenue.

The governing body of the city’s redevelopment agency is a board composed of the City Council members.

“Clearly there has been no accountability,” said State Rep. Amber Mariano, R-Hudson, who pushed for the audit.

While the operation of the Port Richey Community Redevelopment Agency has come under fire several times over the years, the latest questions arose around the time of the arrest of former Port Richey Mayor Dale Massad three years ago. He was charged with attempted murder after firing at law enforcement officers serving a search warrant at his home. Other city officials left in the months that followed.

In the midst of the upheaval, Mariano questioned the city’s fiscal viability and sought to disband it.

Eventually she settled for the audit to examine if the city’s redevelopment agency was properly doing its job.

“Honestly, the audit showed exactly what I was saying two years ago,” she said, “especially about the salaries.”

She called the overall results “mind-boggling” and said that she was amazed that Mayor Scott Tremblay had maintained that the city has been doing well financially even as the city was having to cut its contributions to the agency to fund city services.

Tremblay and city manager John Dudte did not return calls seeking comment on the audit.

Mariano also said she is concerned about the city’s formal audit responses that indicated staff may not be willing to make all the changes recommended.

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“I hope to meet with the city officials to see if they have any plan,” she said, “to see what they’re going to do to address all of these recommendations.”

The 37-page document cited 15 issues for the agency to address, identifying unmet operational obligations by the agency including:

• failing to document and detail its project list, timelines and cost estimates
• failing to adopt basic policies, including fraud protections, procurement rules, budgetary controls, public notice requirements, specific formulas to track employee work done for the agency by city employees, and failing to fine the city or the county for not meeting several fee payment deadlines
• not updating lists of agency officials so that those individuals could meet state requirements to disclose personal financial interests
• failing to reflect agency money rolling forward from one budget year to the next and documenting specific projects those funds were dedicated toward

City officials responded to the auditor that they were working on most of the recommendations presented in the audit but took issue with several of the findings. The city specifically challenged the assertion that agency money cannot be used to pay council member and other city salaries. The auditor responded, reaffirming that the salary expenditures were not permitted by state law.

The city staffers also asserted that they had the right to shrink their contribution to the redevelopment agency to meet other city budget obligations in 2008 and 2020 while still expecting Pasco County to pay its full share. In those years, the auditor noted, the county share of tax revenue accounted for 98 and 97 percent of the total redevelopment agency revenue respectively when the total funding from the county should have only been 58 and 53 percent.

The auditor said the city didn’t have the right to alter an agreement with the county that spells out the funding split for the redevelopment area without the county’s consent. The city said it did have the right because the city and the redevelopment agency agreed to the arrangement. The auditor then repeated that the interlocal payment agreement was between the city and the county, not the city and the agency.

The auditor also noted that when questions were posed about agency decisions, answers were not always available because staff involved no longer worked for the city or records did not reflect that issues were formally discussed or voted on by the agency.

The County Commission last year pushed Port Richey to amend its boundaries, saying that it was inappropriate to include upscale neighborhoods like Harborpointe, a gated, waterfront community with homes valued at more than $1 million. The auditor had the same criticism.

Port Richey carved Harborpointe out of its agency’s boundaries after the county’s criticism.

“I was glad to see the auditors had many of the same concerns I have raised for years,” said Pasco County Commissioner Mike Moore. ”All elected officials and government employees have a responsibility to take good care of taxpayer money.”

Moore said he hopes to see more response from Port Richey officials in light of the audit findings.

“Fortunately, Port Richey did remove the Harborpointe area from their (agency), which I pointed out clearly did not meet the statute’s definition of slum and blight. I hope they will look closely at removing more areas from the (agency) boundary,” Moore said.

Pasco County Commissioner Jack Mariano, father of the state representative, said he also was pleased to see that the audit findings tracked with concerns the county has had about Port Richey’s redevelopment agency. The audit, he said, “dramatically shows how much they have been contrary to state law.”