Monroe County commissioners recommend suspension of tourist agency marketing director

The five-member Monroe County board of commissioners voted unanimously Tuesday to recommend suspending the director of the tax payer funded agency that oversees tens of millions of dollars in tourism marketing.

The move comes a week after the county’s comptroller released its own damning audit of the agency, the Monroe County Tourist Development Council, known as the TDC.

The audit, written by Monroe County Clerk of the Court Kevin Madok, found numerous examples of financial mismanagement, possible double billing by one of its main contractors through a company that may not exist and a questionable relationship between the director and a photographer — who’s been paid hundreds of thousands of dollars by the agency.

Monroe County State Attorney Dennis Ward said Wednesday that he’s looking closely at the findings in Madok’s report.

“I’m very concerned about the information provided in the clerk’s audit,” he told the Herald.

County officials said upon the report’s release last week that commissioners would discuss their reaction to Madok’s audit. The county commission doesn’t have immediate governance over the TDC, but recommended at its meeting Tuesday in Key West that the agency’s nine-member board suspend marketing director Stacey Mitchell with pay pending the outcome of an external audit.

They also voted to recommend for the TDC’s board to hire Coral Gables accounting firm Cherry Bekaert to conduct the audit of the agency’s books and accounts in addition to providing temporary financial and management assistance in the absence of Mitchell.

A representative from Cherry Bekaert said the firm’s audit could take up to 16 weeks and come with a price tag of between $75,000 and $300,000.

Mitchell, who declined to comment when reached Wednesday, technically works for Visit Florida Keys, which is a contracted nonprofit that handles the TDC’s administration.

Rita Irwin, chair of the TDC’s board, told commissioners at the meeting that she has not met discussed the matter with other board members because they have not met publicly since Madok’s audit was released. Florida’s public records laws prohibit elected officials from discussing matters outside of published meetings.

But, she assured them, “We will cooperate, we want to get better.” The TDC board’s next meeting is Thursday, Nov. 16.

“We do believe we have a challenge to fix the bike while we’re riding it,” she said.

Madok’s audit covers between 2018 and September 2023. He told county commissioners the lack of documentation detailing how the TDC spends its money raised numerous red flags.

“There is little in the way of tangible things to audit,” he said.

What did they find in the audit?

The most significant finding in Madok’s audit was that Andy Newman, president of NewmanPR, the TDC’s “public relations firm of record,” may have double billed the agency through a company called Graphics 71, which auditors said in the report they could find no record of existing and its mailing address mirrors NewmanPR.

Newman declined to comment on the audit because Madok stated in his report that, as a result of the findings, he is conducting a specific audit of NewmanPR’s contract with the TDC “to review additional invoices to determine the legitimacy, compliance with contract, and adherence to Monroe County purchasing policy.”

Although Madok recommended that the county stop processing NewmanPR’s reimbursement requests, County Attorney Bob Shillinger said Wednesday that the company will still be paid its monthly fee.

Madok told the Herald that from October last year to this September, fiscal year 2023, the TDC paid NewmanPR $1.9 million. Of that amount, $733,688 were the annual public relations fees and $1,170,834 was for reimbursements the company requested, he said.

No-bid contracts

Additionally, Madok found Visit Florida Keys’ continued hiring of a Key West photographer who has provided pictures for TDC calendars since 2005 questionable because it doesn’t appear to have been done through a competitive bidding process.

Mitchell is friends with the photographer, Rob O’Neal, who Madok said has been using the calendars to promote his business’ website.

‘Lack of internal controls’

The audit also documents what Madok called “a significant lack of internal controls and management oversight over TDC’ s financial transactions and annual financial reporting.”

For example, the report states Mitchell shared her password that is needed to access the county’s finance system — allowing her to approve purchase orders, staff travel reimbursement and vendor invoices for payments — with her financial assistant. Madok said this allows the subordinate authority she should not have.

“The marketing director did not express concern that by sharing her credentials with the finance assistant, she was giving the finance assistant the ability to both initiate and approve purchase orders as well as the ability to both initiate and approve vendor invoices to be paid with no management oversight,” Madok said.

The audit also details an instance in which a NewmanPR employee submitted to Visit Florida Keys a restaurant bill for reimbursement, even though the actual bill showed the restaurant comped the meal.

Visit Florida Keys accepted the reimbursement request and submitted it to county finance staff “with no explanation,” the report states.

“We want to emphasize the main issue is not the amount of the questionable reimbursement request, but rather the fact that the contractors appeared to be willing to submit a fraudulent document, Madok wrote.”

‘Cash cow’

The commissioners did not comment much on Madok’s report other than to say the outside audit was needed as a result of his findings.

“This is not a punishment,” said Commissioner Michelle Lincoln, who represents the Middle Keys city of Marathon. “It is an opportunity to find what could have been done differently, what could have been done better and what was done in an incorrect manner.”

The TDC is funded through a 4% tax that everyone who books a Keys hotel room or short-term rental is charged. From October 2022 through September 2023, the county collected $58.9 million to support the TDC’s operations.

The money is used for a variety of promotional materials, including television and print ads that are seen around the world aimed at coaxing vacationers to come to the Florida Keys.

However, Richard Tallmadge, a Key West business owner and former TDC board member, said at the meeting that perhaps its purpose should be reconsidered because the Keys has so many annual visitors that it’s created a strain on the island chain’s residents and natural resources.

“We have an organization that’s become a cash cow. It just generates tons of revenue, and there are no checks and balances to make it work effectively and efficiently and holistically,” he said. “This is all about heads in beds, and unfortunately, we’re paying a big price as residents from this heads-in-beds attitude.”