They also sent email – lots of it – to City Commissioners.

The formidable email campaign mounted by Ms. Zguna’s supporters made an impression on the city’s politicians, creating a buzz at City Hall culminating in a unanimous commission vote that gave the nod to Zguna’s company. The commission vote in favor of negotiating a new contract with HPSM was a rejection of the city’s own selection committee whose first choice was competing vendor NetResults Tennis LLC. HPSM and NetResults bid proposals and selection committee evaluations of both vendors can be accessed by clicking the buttons below.

HPSM Proposal    NetResults Proposal    Selection Committee Evaluation

Angie Zguna’s High Performance Sports Management Wins Commission Approval

A review of Angie Zguna’s career highlights and qualifications (provided to the city by Ms. Zguna) shows that she established herself as a formidable competitor at an early age. In her native Latvia, she rose quickly in ranks of young tennis stars, earning a high ranking in singles and doubles tournament play. Her performance in her home country ultimately lead to a #16 “Junior” ranking in the Soviet Union republics. After moving to the U.S. in the 1990s, Ms. Zguna played collegiate tennis in Louisiana before transferring to Rollins College where she earned the title of #1 Singles player in Division II.

Despite the strong support Ms. Zguna received from Winter Park’s tennis devotees, she has had to overcome many obstacles to win acceptance at City Hall – including opposition three years ago during her initial bid to manage the center. That opposition included other competing bidders and some Tennis Center members who opposed her in 2009, but are now supporting her.

In 2009, Ms. Zguna bested another strong competing bidder – who also happened to be the first choice of the city’s selection committee – and then managed to survive a second challenge when the losing bidder contested the City Commission’s vote in her favor.

All sources the Voice spoke with – inside and outside city government – agree that HPSM is managing the Tennis Center better than the city did and that Winter Park’s tennis players are happy with the arrangement.

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Why Did Tennis Center Lose Money before 2010 and Make So Much After?

According to a Jan. 25, 2010 story in the Orlando Sentinel, “the city lost $200,000 in the past four years” leading up to the management change. In 2009, the Tennis Center earned $128,420 in gross revenues, but the city’s cost to run and maintain the center was $213,655.00. The city’s yearly losses are cited as a key reason the city chose to privatize the management of a Tennis Center. In 2010, the center experienced a dramatic turn-around when the city privatized center management. Under HPSM management, Winter Park’s Tennis Center quadrupled its gross revenues over the next two years – moving the center from annual gross revenues of $128,420 in 2009 to $519,240 in 2011.

The Voice asked John Holland, Director of Parks and Recreation, how the Tennis Center managed to lose so much money when city staff was running it prior to 2010. Though Mr. Holland has testified to Ms. Zguna’s skill at running the Center and lauded her expansion of membership at the center, he credited a single factor as the key reason Tennis Center revenues turned from loss to profit so quickly: Tennis Pro fees.

Mr. Holland told the Voice that, prior to 2010 when the city ran the center, tennis professionals teaching at the center were only required to pay the city a small annual fee to teach on city-funded courts. When HPSM took over management of the center in 2010, the city required Zguna’s company to charge these independent pros a percentage of the private lesson fees they earn at the Tennis Center. According to Holland, this significant increase in revenue played a large part in turning the Tennis Center from loss to profit virtually overnight.

Was the City/Zguna Deal Too Sweet?

The Voice has spoken with sources close to the story who question whether the city might have driven a harder bargain – requiring HPSM to share more of the revenues generated by the Tennis Center, which is still city-owned. City staffers confirm that they do not know – year to year – what those net revenues are because Ms. Zguna’s company is not required to report profit and loss information to the city. However, Ms. Zguna did submit tax returns to the city as part of the current bid process.

The city’s current contract with Zguna’s company specifies that HPSM pays 10% of annual gross revenues to the city with the remaining 90% going to HPSM. According to the city, HPSM was not required to pay any sort of fee or “buy-in” to take over the city facility.

Per its contract with HPSM, the city has been obligated to cover most of the expense of maintaining the Tennis Center (including utilities) except for the cost of HPSMs own administrative overhead which includes their personnel costs. The Voice has confirmed with city staff that the city’s current negotiation with HPSM on the new contract includes a requirement that HPSM will pay for the center’s water and electric utilities starting this year – a concession worth about $40,000.

Despite the limited financial information the city receives from HPSM, city staff has provided the Voice with information on its own Tennis Center costs and assumed HPSM annual revenues. This information appears to support speculation that the center may be generating significant net profits for HPSM. In the years since the city created a defacto “partnership” with HPSM by handing over 90% of revenues in return for management services, the city has continued to provide much of the maintenance and upkeep of the HPSM-run center. City costs have been at least partially offset by the 10% of revenues the city receives from HPSM.

New Contract Negotiations: Will City Leave Too Much Money on the Table This Time?

In response to Voice inquiries, the city provided the information shown below documenting the 10% payments the city has received from HPSM over the last three years. Also shown are the gross revenues the city assumes the Tennis Center is earning as extrapolated from the 10% payments received by the city:

2010 — 10% = $34,310 / Assumed HPSM gross: $343,100
2011 — 10% = $51,924 / Assumed HPSM gross: $519,240
2012 — 10% = $50,521 / Assumed HPSM gross: $505,210

According to John Holland, the city’s Director of Parks and Recreation, the cost to the city of maintaining the Tennis Center in 2012 was $50,791.73. $40,393.00 of that cost was for water and electrical utilities – a cost that will be shifted to HPSM under the new contract. If city estimates of Tennis Center gross revenues are accurate, the center grossed almost $400,000 more in 2012 than it did in 2009.

Angie Zguna Responds

The Voice spoke with Angie Zguna, who accepted the city’s numbers and assumptions, though her own calendar-year accounting and royalty breakdowns are slightly different than the city’s fiscal-year-based accounting. Ms. Zguna also points out that HPSM covers “all operational expenses of the facility” while acknowledging that the city supplies significant assets, utilities and maintenance per its current contract with HPSM.

In her statement to the Voice, Ms. Zguna expressed her gratitude for the support she received from Winter Parkers: “We are thrilled to have once again been chosen to manage the operation of the tennis center. We love Winter Park, the community, Rollins, and feel that this is our home and to be able to continue managing the courts is a privilege and honor. We intend to take the center to the next level by continuing to work with the community to attract more local residents to learn tennis, to provide community outreach by working with local schools to introduce tennis as a lifetime sports to elementary and middle school children, to bring more tournaments, increase membership, and to attract international players to Winter Park tennis center as a world class training facility.”

The Voice has asked all City Commissioners and the Mayor to comment on this story. None have commented as of press time.

Cooper Faults Bradley for Ethical Inconsistency: “Wrong / Shameful”

In Monday’s Commission meeting, the gloves came off soon after opening niceties were dispensed with. Mayor Bradley started the exchange by responding to the City Auditor’s resignation: “I personally welcome that and will welcome the new partner.” Commissioner Cooper jumped in and asked for consideration of new rules and a consistent standard of conduct. As a case in point, she spoke about campaign contributions given to commissioners by the prior City Auditor.

Cooper cited her own investigation that turned up evidence that “that our prior auditor actually made contributions to candidates — financial contributions — while they were auditors.” Cooper compared the commission’s concern about an endorsement with their silence regarding campaign contributions by prior auditors: “If we were uncomfortable with the James Moore firm saying that I prepared for meetings, then I’m sure we would be equally uncomfortable with an auditor that gave the maximum possible financial contributions to people on this commission . . .”

Mayor Bradley disagreed, referring to the Auditor’s letter of resignation: “There’s a huge difference . . . she said, I mean, in her letter as you’ve read, apparently the same thing: ‘We probably should have re-thought that’ and because of that to assure the assurance that there’s no questions that she’s asked to be relieved of that responsibility. So I support that decision. I think that she did the right thing.”The entire Feb. 11 commission discussion of the City Auditor resignation is featured in WPV Video shown below.

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2/9/13 Story: Election 2013 was re-ignited last week in Winter Park’s City Commission meeting when Mayor Ken Bradley called for the City Auditor to appear before the commission and explain her campaign endorsement of Commissioner Carolyn Cooper. “I think it’s a serious enough breach . . . that I think she should come and explain herself to this group.”

The Mayor’s challenge of the Auditor was set in motion two weeks earlier – in the prior January 14 Commission meeting – a few days after Commission candidate Ross Johnston filed an election-related lawsuit against the city. In that meeting, the Mayor asked the City Attorney to participate in a review of “the financial independence” of the City Auditor.

The endorsement in question is a two-sentence statement by Bernadette Britz-Parker, the City Auditor, in support of Carolyn Cooper’s study habits: “In 32 years of auditing governments, I have rarely encountered an elected official who has been as prepared as Commissioner Cooper. It’s refreshing to sit down for a meeting, and realize the financial information has already been studied so we’re not starting from scratch.” Commissioner Cooper included the statement in a campaign mailer and on the Endorsement page of her campaign website.

Ms. Britz-Parker is a partner in the CPA firm, James Moore & Co., P.L., that audits the city’s finances. The firm was hired in 2010 after being recommended by an Auditor Selection Board that included three accounting professionals, the Chief Deputy Comptroller for Orange County and Commissioner Cooper. Britz-Parker’s firm was ultimately approved and voted on by the entire City Commission.

Mayor Bradley set the tenor of the discussion early in the meeting by challenging the Auditor’s actions: “I find it questionable – highly questionable. Enough that it’s created questions in this community . . .” Bradley’s sentiments were echoed by Commissioner Sprinkel, who supported the Mayor’s call to have the Auditor explain her endorsement. (See video of full discussion below.)

City Attorney Finds No Violation, But Questions “Appearance” of Auditor Endorsement

During the meeting, City Attorney Larry Brown summarized his research on the matter by stating that opinions he’s researched show that “Generally accepted auditing standards and the United States Comptroller’s Government Audit Standards . . . do require that the auditor maintain independence. Independence is generally defined in the opinions as relating to financial independence, so when you look at the opinions, they don’t get into political endorsements. The opinions deal with an auditor who owns stock in a subsidiary company that he or she is auditing, or . . . an auditor is on a subsidiary board of a government that they’re auditing. Those are the kinds of independence opinions that I found. I did not find an opinion that expressly said giving an endorsement of that type, per se, violates the standard of independence.”

Brown did venture an opinion that generally accepted “best practice” among professional firms who do government business (including his firm) is to avoid endorsing candidates. Brown indicated that many, but not all, firms avoid endorsing or contributing to candidates because “the appearance is arguably one that interferes with your independence.”

Several accounting professionals contacted by the Voice agreed that campaign endorsements in a case like this are problematic – and are best avoided in the interest of maintaining the appearance of independence. However, the sources we spoke with could not point to any direct conflict of interest where the actual work of the Auditor – auditing city finances – could benefit any individual city commissioner.

Mayor Contemplating Termination of Auditor?

In an email obtained by the Voice, (see button below) the City Attorney states that “In my opinion, an official could reasonably find that this endorsement, (assuming it is a materially accurate quote), made with the intent that it would be used publicly in the campaign, created at least an appearance that the auditor failed to take action to assure the City and the public regarding her “independence”. As stated in my previous letter, Generally Accepted Auditing Standards stress that the auditor has an affirmative duty to assure her independence.” Brown also notes in the conclusion of his email that “It isn’t my role to decide whether this endorsement warrants termination of the contract.” There is no mention in the email of who may have asked the City Attorney about a “termination” option.

The Voice contacted City Manager Randy Knight, City Finance Director Wes Hamil and all City Commissioners and submitted questions regarding potential conflicts of interest created by the Financial Auditor’s endorsement – including the question of how an endorsement of this sort could actually impact the duties of the city’s Financial Auditor, or the city’s financial standing. Other than Commissioner Cooper’s statement to the Voice, none of the commissioners or city officials responded to our questions and request for comment. Commissioner Sprinkel declined comment, citing “Sunshine Law” concerns.

Commissioner Cooper’s statement to the Voice included her contention that the Auditor’s endorsement broke no rules and that she believes “. . . it is understandable that I would ask those professionals that work with me, as a commissioner, to comment on my work habits and dedication to the job I was elected to do . . . I believe our auditor is a professional and independence in matters of the city’s financial audit was not compromised. Had I thought otherwise, I would never have asked for a statement. Only professionals who have interfaced with me as a commissioner can fairly assess my dedication and competence.” The full text of Cooper’s statement can be viewed by clicking the button below.

Are City Officials Having “Off-The-Record” Conversations About Auditor?

According to City Attorney Brown, his formal January 25 opinion letter concerning the endorsement (see button below) was triggered by the Mayor’s request at the end of the January 14 Commission meeting. However, a careful review of meeting minutes and our video of that meeting does not appear to reveal the kind of specifics that Attorney Brown would have needed to craft his opinion letter.

In his letter, Brown mentions several times that he has not received any “written” information pertaining to case specifics. This distinction creates a question of whether there were verbal “off the record” communications regarding this case between the City Attorney and city officials. Following up this question, the Voice requested that city officials provide an “account” of the initial inquiry that supplied the specifics of the case to the City Attorney. As of press time, the Voice has received no reply regarding this matter from the city.

City Attorney – Auditor Opinion   City Email re Auditor   Cooper Statement

During last week’s Commission meeting, Commissioner Cooper defended the actions of the Auditor and took the blame for exposing her to criticism. “I feel very responsible for her kind of being called on the carpet . . . I did say to her ‘Oh, would you mind giving me an endorsement?’ and so that really is my fault . . . I don’t think it has any reflection negatively on her professionalism . . . all she said is that I was prepared . . . I’m willing to accept total responsibility for it.”

Cooper Takes Aim at Leary’s Support for Her Election Opponent. Mayor Objects.

Cooper followed her explanation of the Auditor’s endorsement with a thinly-veiled swipe at Commissioner Leary’s support of Ross Johnston’s campaign for her commission seat, adding “I am willing to say as a commissioner that I will – if we could do it as a group – that I will not sign petitions on behalf of a candidate, I will not volunteer my employees to be campaign treasurers for a candidate – nor will I ask anyone who works with me in my capacity as a commissioner to give me a reference.”

Mayor Bradley countered Cooper, taking exception to her equating campaign support with campaign endorsements (neither Cooper nor Bradley mentioned Leary by name) : “I think the Auditor’s incredibly different from that . . . I think that when we go to Wall St. or anyplace else, the financial independence of the auditor’s recommendation and opinion is critical.”

The Mayor called again for the Auditor to appear and explain whether her endorsement changes her financial independence. Commissioner Cooper criticized the Mayor’s approach, “It’s just public humiliation – and unnecessarily so . . .” Bradley quickly countered “I think it’s a question that needs to be answered in terms of financial independence . . .” The Mayor then hinted at a possible outcome of the investigation: “I think it’d be a lot easier than moving tonight that we terminate the Auditor immediately . . .”

Cooper Calls for Campaign Reform: Let’s Stop Taking Contributions From Large Developers

The strained relationship between Mayor Bradley and Commissioner Cooper surfaced repeatedly during their point-counterpoint exchange – with Cooper continuing her call for across-the-board reforms of commission campaign practices. “I personally would like for us to not accept contributions from people who bring large developments in front of the city.”

Commissioner Leary spoke next – his only input into the discussion. He supported the Mayor’s request for an explanation from the Auditor. “I’d certainly like to hear her explanation for what she did . . . this is a rabbit hole we’re getting into here. I’d like to just address this one thing on the point and move on . . .”

As the discussion wound down, Mayor Bradley offered to allow the Auditor to speak with the commissioners individually and/or submit a written explanation. Commissioner McMacken agreed that individual meetings with the Auditor would be appropriate.

In response to a request for comment from the Voice, Ms. Britz-Parker indicated that she will be submitting a written statement to the city regarding her actions. Winter Park Voice will publish the Auditor’s response as soon as it is made available by the city.

City Attorney Also Targeted in Election Controversy. Job Was Threatened Last December.

Complaints about high-level city professionals have not been confined to endorsements – City Attorney Brown has also been subject to recent election-related criticism and commission actions that put his employment at stake. In the same week that Mayor Bradley first questioned the City Auditor’s endorsement of Carolyn Cooper, Cooper’s opponent, Ross Johnston, accused the City Attorney of “possible” favoritism toward Commissioner Cooper. Johnston never produced any proof of bias and ultimately dropped his lawsuit to compel the city to place him on the ballot opposing Cooper.

Thirty days before Johnston leveled charges at the City Attorney, Mayor Bradley and Commissioner Leary mounted an unsuccessful bid to potentially replace Larry Brown as City Attorney. The motion to seek bids from other law firms to serve as City Attorney failed on a 3 to 2 vote at the December 10 City Commission meeting.

Though complaints about Brown from Bradley and Leary did not include charges of bias, the Mayor and Commissioner did state dissatisfaction with the attorney’s fees and job performance. Mayor Bradley also commented that he’d like the City Attorney to be “much more a part of this team.”

A common thread linking City Commission actions to possibly replace the City Attorney – and to investigate the City Auditor – are statements by Commissioner Leary & Mayor Bradley implying that these two officials could lose their jobs. In his remarks during the 12/10 commission meeting, Commissioner Leary referred to the City Attorney’s job while openly speculating about “someone else representing us”. Mayor Bradley is on-record mentioning an option on 1/28 to “terminate the Auditor immediately.”

WPV video below shows the entire Dec. 10 commission discussion of a search for possible replacement of the City Attorney. The entire Jan. 28 commission discussion of the City Auditor investigation is featured in WPV Video shown above.