Turlock chamber, city shake hands on contract settlement

The city of Turlock and the Turlock Chamber of Commerce have reached a tentative settlement in their contract dispute. The deal spreads repayment over 25 years for unsubstantiated spending by the chamber while serving as the city’s Convention & Visitors Bureau.

The chamber ran the city’s visitor marketing for 24 years until the city contract ended May 3. An outside auditor examining the books from 2009 to 2015 found $340,820 in charges that lacked receipts or proper paperwork.

The deal as presented requires the chamber to pay the city $675 a month and grant it free membership for 25 years, adding up to $250,300 using this year’s annual membership fee of $1,912. It also requires the Turlock Chamber of Commerce to continue organizational reforms implemented last year under interim chamber director Paul Wright and for city staff to more strictly monitor the contract.

Under the contract, the chamber had to pay back charges it could not document and the city was to oversee a yearly accounting of charges, which it failed to do, City Council members agreed during discussion of the audit by Kemper CPA Group.

The reimbursement agreement recognizes that former leaders of both the Turlock Chamber of Commerce and City Hall did not follow financial guidelines established under the contracts, notes a city of Turlock statement. The chamber’s longtime executive Sharon Silva retired last summer. A new president is expected to be hired around March.

“As public officials, we hold ourselves to a higher standard of transparency and accountability,” Turlock Mayor Gary Soiseth said. “Unfortunately, in this case, this high standard was not met by both parties between 2010 and 2014.”

Soiseth and the Turlock Chamber of Commerce board of directors hammered out the deal, which will still have to be approved by the City Council and the chamber board. The council is scheduled to take up the matter March 1.

“With this agreement, the chamber and the city reaffirm the importance of a strong relationship between the city and the Chamber of Commerce,” said chamber board Chairman Lazar Piro. “The chamber exists to support Turlock’s business community, and to work with the city in connection with business development, expansion and retention.”

The chamber did not sign off entirely on the city’s calculations of disallowed expenses, the statement makes clear.

“While there may be substantial disagreement between the city and the Turlock Chamber of Commerce regarding the interpretation of the parties’ contract, both agencies believe this is an equitable resolution of their dispute,” it says.

Most of the charges questioned by auditors were for administrative expenses, including salaried staff being paid an hourly wage for extra work and procedural slips such as commingling office supplies. Over several years, excess charges were reclassified or deducted just before books closed, the audit found, with any deducted amount reappearing as a charge against the following year.

Though technically allowed, auditors also called out the chamber’s practice of charging the city more for city maps and visitor directories than they cost to produce, while pocketing advertising income from them.

“I look forward to this next chapter in our decades-old partnership,” Soiseth said. “It’s in the best interest of Turlock’s residents to maintain a working relationship between the Chamber of Commerce and City Hall.”

The council will hold a competitive bid, likely in the summer, for Convention & Visitors Bureau services such as marketing, branding and events.

This story was originally published February 19, 2016 at 1:21 PM with the headline "Turlock chamber, city shake hands on contract settlement."