Sixth in a series by Jim Sneddon
During this NewsLanc investigation, a review of thousands of documents often revealed things happening behind the scenes that were never made public.
There were times when set dollar amount contracts also grew. One was with as E4 Exchange of Lancaster.
The company was hired in conjunction with a Consortium established in the summer of 2004 by the Pennsylvania Dutch Country Visitors Bureau, the Chamber of Commerce, Economic Development Company of Lancaster County and the Authority.
When Tom Baldrige, director of The Chamber, contacted David Hixson, LCCCA Executive Director, about hiring E4 and sharing the costs 50-50, Hixson agreed. The Letter of Agreement from Lois Dostalik, President and CEO of E4, was signed by Beckett and Hixson. The fee for the 12-month engagement was $48,000, meaning the Authority was responsible for $24,000.
By the time the year was over, however, the Authority had been billed, and paid, $69,696.
E4 was to design Consortium meetings and provide facilitation assistance. It was to “Design the Project Management Plans.” This included the four Consortium members, but “in addition we will develop a written list of detailed responsibilities for the Mayor and the County Commissioners,” Dostalik wrote.
Communications were important according to the Agreement. The contract language spelled it out: “This includes ensuring that key messages are shared at the right time, using the appropriate communication style.”
Apparently communication with the Authority board was not important. The agreement was never brought to the board for approval. No board member ever raised a question about why they were paying E4 during the monthly “Pay the Bills” votes at the Authority meetings.
The first invoice for $15,934.20, dated Dec. 29, 2004, was almost quadruple the monthly figure quoted in the agreement. Included in the invoice was a note reminding that the Authority had agreed to 50% of the costs. The invoice added that “as these services are not included in the August 26 Letter of Agreement, it is understood an addendum will be issued no later than April 2005 to reimburse the original project.”
There is no record of Hixson bringing “an addendum” to the Authority for approval. No copies of an addendum were included in this investigation’s right to know request for copies of all contracts.
The Consortium didn’t last long.
By July 2005 the “plug had been pulled.” In an e-mail to Hixson, Baldrige wrote that the Chamber paid a $3,600 retainer fee to E4 Exchange. It also paid $11,100 to be placed into escrow by E4 to cover the first three monthly costs as per the contract. Baldrige noted, however, that only $3,720.68 in expenses was actually billed, but he wanted his 50%.
“In trying to close out the effort, I was wondering if you would still be willing to cover the 50% of the expense as per our original agreement? That would amount to $1,860.34.”
Hixson agreed and told Baldrige the payment would be on the July “Pay the Bills.” According to the records. the check was approved by the Authority board.
What is unclear, however, is whether the full $69,696 was paid only by the Authority, with nothing coming from the Chamber. The Authority was billed that amount and the board approved checks totaling that full amount. There is no evidence, in reviewing the Authority’s account statements from Sovereign, that there were any deposits from the Chamber indicating a reimbursement for its 50% share.