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Recovering from an Embezzlement Scandal, the Fresno Convention and Visitors Bureau
 Will be Kept Alive by City's Continued Financial Support
By Matt Leedy, The Fresno Bee, Calif.McClatchy-Tribune Business News

Mar. 21, 2007 - The Fresno Convention and Visitors Bureau -- still recovering from an embezzlement scandal -- learned Tuesday that it will be kept alive by continued financial support from the city.

Fresno's taxpayer money, however, comes with catches.

Rather than receive quarterly payments as it has for years, the bureau will be reimbursed for its expenses, such as electricity bills. And city officials say those expenses will be examined closely.

The bureau also must agree to new rules and keep closer watch on how public funds are spent.

Before it was assured of receiving city money next month, the bureau had to show council members and Mayor Alan Autry's administration it had added financial oversight measures that could have prevented the alleged theft by a former bookkeeper last year.

Deanna Christine Gonzalez, 38, was arrested last week and charged with using credit cards and fraudulent checks to steal more than $56,000 from the bureau.

The agency has stopped giving employees credit cards and two bureau officials are now required to sign checks. The nonprofit also hired an outside firm to manage its finances.

"We had an embezzlement. We dealt with the embezzlement. That part is over," Bureau Board President James Pardini said.

While some council members were still critical of the bureau Tuesday, none acted to cut its funding.

Council Member Jerry Duncan said financial oversight has been missing from the bureau for years. "Which leaves me with the concern: Is this the right organization to move forward with?"

Duncan asked City Manager Andy Souza to look at other organizations that could book conventions into the Fresno Convention and Entertainment Center.

Of the bureau's $850,000 annual budget, $735,000 is taxpayer money.

Council members Mike Dages, Cynthia Sterling and Henry T. Perea defended the bureau and said it should continue to receive the city's support.

"Every business has a little bump in the road but you don't close the business down," said Dages, who sits on the bureau's board. "We need to give them money so they can do their job. Don't let the Convention and Visitors Bureau fail. It would be the worst mistake in this city's history."

Souza said the city will disburse $184,000 on April 1 for bureau expenses over the next three months. But the bureau must make several more changes this year, he said, including:

Adding rules that prevent the bureau's board of directors from doing business with the agency.

Increasing dues-paying members. Membership dues brought $105,145 to the bureau in 2006, down from $116,438 in 2005, according to a recently-completed audit.

Considering whether the bureau's board, which has two dozen directors, should be pared down.

Those conditions are still being discussed by city officials, bureau leaders and SMG, a company that oversees the bureau and manages the Fresno Convention Center.

SMG receives the city's quarterly payments and typically hands all the money over to the bureau. But beginning April 1, SMG will dole out taxpayer money only after the agency shows it should be reimbursed for legitimate expenses, Souza said.

SMG also will be responsible for making sure the bureau enforces the new rules and maintains its added financial oversight.

Council Member Larry Westerlund said the alleged embezzlement taught the bureau some "painful and expensive" lessons about the need for close financial oversight.

"But I think it was a blessing in disguise," Westerlund said. "Now we have the opportunity to make changes to improve the CVB."

The reporter can be reached at mleedy@fresnobee.com or (559) 441-6208.

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Copyright (c) 2007, The Fresno Bee, Calif.

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