Carmel Performing Arts Audit Fails To Produce Smoking Gun

Carmel Mayor James Brainard spent more than $8,000 of taxpayer money on a private investigator in an attempt to prove that Steven Libman, the former executive director of Carmel's Regional Center for Performing Arts, had misspent the nonprofit's money on entertaining another female employee of the center with whom he was accused of having an inappropriate relationship. Yet an audit found the female employee had accompanied Libman on only a handful of trips to New York costing the nonprofit a little more than $1,100. The audit did, however, fault the female employee's failure to separately submit her own travel reimbursement requests rather than billing them to a credit card issued to the nonprofit. Fox 59 News' Ann Yeager, who has been doggedly pursuing this story from the beginning, got this reaction from other Carmel officials, who wondered if the public humiliation and firing of Libman was all justified and pointed out that Brainard himself had taken a female city employee along with him on at least one of those trips to New York:

Former City Councilor John Acceturro said that is chump change.

“Libman's travel expenditures for meals indicated in the review were small considering it was for two and in the New York City area,” said Accetturo. “Hotel costs were also within range.”

Critics also question that on at least one trip to New York, Mayor Jim Brainard brought Nancy Heck, who is his community affairs specialist, with him on travel but never mentioned it publicly.
Due to a concern of a potential sexual harassment lawsuit, Mayor Brainard hired private investigators at taxpayer expense to follow Libman and his assistant at the tune of $8,000.

Councilors said the audit revealed no wrongdoing.

Fox59 contacted Mayor Brainard who is in Washington, DC. We asked him if this was a witch hunt, and he replied ‘no comment’.

Brainard defends hiring private investigators, because he feared Libman’s mistress would sue the city for sexual harassment. However, she has not . . . “

There’s nothing in there, no evidence of financial misdealing or fraud,” said Acceturro. “The only thing the audit tells me that there is no evidence.”

The biggest criticism of the nonprofit's management in the audit was its failure to obtain advance board approval for a PBS special to promote the center that resulted in a net loss of $400,000.

When Libman's abrupt resignation from the nonprofit was first announced last year, Mayor Brainard had publicly accused him of misspending money on his mistress. He told the Star:

"Some sources have indicated that Mr. Libman was consistently flying to other cities in the country with his assistant at the (art center) foundation's expense to supposedly view shows he might want to bring to the Palladium," Brainard said. "These sources have indicated they believe it was nothing more than to cover for expensive dates out of town." . . .

Ironically, Yeager uncovered travel expenses submitted by Carmel city attorney, Doug Haney, for reimbursement for staying overnight in hotels in Indianapolis on numerous occasions when he attended seminars. Haney racked up about as much in costs for his hotel stays in Indianapolis only thirty-five miles from his home as was involved with the female employee's travel to New York.

For his part, Libman issued this statement to Current In Carmel lauding the findings of the audit:

“Today’s release of the regular annual audit of The Center for the Performing Arts, Inc. fills me with both pleasure and pride. It gives me pleasure because this regular annual audit demonstrates that through the end of the Center’s 2010-11 fiscal year, financial matters were handled with the high standards of care and professionalism that I demanded as President and Chief Executive Officer. Pride because the positive operating results and cash balances demonstrate the extremely fast development of the Center from a building and a vision into a vibrant, successful regional asset for performing arts through the hard work of the Center’s staff.

“Finally, I am especially proud of the Center for ending each of the first two years of operation with a surplus – a great accomplishment for a start-up performing arts center. This wonderful achievement was possible due to the very talented senior staff that I recruited and hired. Their dedication and leadership is what has enabled the Center to continue to move forward successfully.

“I congratulate the Board and the present staff for the Center’s solid performance and wish them the best of luck in the future.

“With respect to the internal review reported by Board Chairman Rollin Dick, I believe any organization needs to increase the sophistication of its financial controls as it grows and matures. At the start-up of the Center, we had a small staff and a very short time to prepare a season. We followed all Center procedures that were in place at the time. Given the success of the Center over the past two years, such items as expense reporting, human resources and contract procedures should be improved.