Internal GLO draft audit slams unusual use of non-profits to manage Alamo

By Jonathan Tilove
Austin American-Statesman
Originally published Feb. 8, 2018

On Dec. 5, the state Senate Finance Committee questioned Land Commissioner George P. Bush and the agency’s general counsel, Jeff Gordon, about the three nonprofits the General Land Office had set up to manage, promote and raise money for the Alamo — each with its own mission but with identical boards made up of Bush and 10 of the state’s most recognizable movers and shakers.

What most vexed the senators was that Alamo Complex Management, the nonprofit responsible for day-to-day operations of the most iconic site in Texas, was entirely funded by public dollars but without the scrutiny and transparency that is supposed to follow those dollars.

“You probably need to look at a different way to do this. There’s too many boxes that are not open to the public and that’s a problem, especially if we are going to put tax money into it,” said Sen. Robert Nichols, R-Jacksonville, adding that the obscure workings of the Alamo boards had seeded public suspicions. “Y’all need to get ahead of this thing – and you’re behind.”

What the senators didn’t know was that three months earlier, a draft report of an internal audit of the agency’s oversight of operations at the Alamo concluded that the unorthodox use of a nonprofit to manage the site is unduly complicated and sometimes runs afoul of state requirements.

The draft report, obtained by the American-Statesman and dated Sept. 8, recommends that the agency “reconsider the structure and funding model for Alamo operations.”

“This is an unusual situation that has created complexity and a lack of clarity regarding the nature and the use of the funds used for the Alamo operations,” the draft states.

Bush is overseeing a $450 million plan to redevelop and improve the historic site with, among other things, a new museum housed in nearby state-owned buildings and additional historic programming. It will be paid for with a mix of public money and private donations.

General Land Office spokeswoman Brittany Eck said the draft report obtained by the Statesman had been “altered.”

“This is a document that has been altered and leaked before being presented to you as authentic,” Eck said. Eck would not say how the document was altered or provide an alternative draft or final product.

According to the agency’s 2017 Internal Audit Annual Report, posted on the agency’s website, the audit report on Alamo accounting processes is marked “completed.” But its “date issued” remains “TBD” — to be determined.

“`Completed,’ only speaks to the internal audit team’s preliminary findings,” Eck said. “Management gets to respond, and may agree, disagree or have some other response to the preliminary findings. That response may be in the form of written rebuttals, or written answers of some other nature, or in the form of actions taken. That part of the audit, which is critical, is not complete – so the audit itself is not complete.”

Eck said, “The GLO proactively decided to audit the financial processes at the Alamo. The schedule of audits including the Alamo was created at the beginning of 2017 and approved by Commissioner Bush. This decision was made to overhaul the archaic financial processes that were in place since the GLO took over the Alamo, and to improve transparency for taxpayers.”

The audit will be made public in “spring 2018,” Eck said. Bush faces a March 6 GOP primary opponent, former Land Commissioner Jerry Patterson, who has made Alamo management a centerpiece of his campaign.

“This report reads like an indictment of how the management structure of this important operation is set up,” said Sen. Kirk Watson, an Austin Democrat who serves on the Finance Committee, after examining the draft report obtained by the Statesman.

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