No Cash Crunch at the Cultural Council

by John Washington on September 15, 2011

In a remarkable turn of events at the Scottsdale Cultural Council, high-flying CEO Bill Banchs ($250k/year) appears to have rebuffed a grant from the highly respected Piper Trust that would have supported the efforts of the Scottsdale Public Art program. The total value of the grant appears to be up to $90,000.

I can’t imagine anyone in their right mind turning down grant money in today’s economy, but maybe that’s the problem (the mind, not the economy). Or the Cultural Council is just flush with cash courtesy of the taxpayers of Scottsdale .

In the process of delivering this backhand to the Piper Trust, Banchs has earned himself a whistleblower claim from the veteran employee who sought the grant. This employee has a national reputation for excellence, yet Banchs  accused her in an email of being “disruptive” and of “grossly mishandling the [SPA] master plan process.” Banchs goes on to imply that pursuing the Piper grant was an act of disloyalty to the Cultural Council.

In an equally remarkable display of arrogance, Banchs delivered a nice little slap at an SPA Advisory Board member, Dick Hayslip, by informing all concerned that Hayslip is not authorized to sign the Piper grant application. Mr. Hayslip also happens to be the Associate General Manager of Salt River Project.

As you probably know, I have for months questioned the financial condition of the Cultural Council; the circumstances under which they received a 20-year, no-bid contract [large file] with the City of Scottsdale that currently earns them $4 million per year (with virtually no objective performance metrics); and their utter contempt for the operational transparency they previously promised to the City of Scottsdale.

In other recent developments:

Update September 16:

The next SCC Board of Trustees meeting will be Tuesday the 27th of September in the SCC boardroom above the Orange Table (west of the main entrance to the Center for the Performing Arts).This is an “open meeting” and the public can attend.

There are currently two items on the “executive session” portion of the agenda. Given the nature of those items, I’d say there’s a better-than-fair chance someone (or more than one person) will be looking for a job afterward. Of course, after the most recent email volley that could happen much sooner.

The last time I attended an SCC Board meeting, “the public” was ushered out of the room for executive session, then after exec the “open” meeting was reconvened to, “approve what we talked about during exec.” Then the meeting was quickly adjourned and no further details about executive session discussions and decisions were forthcoming. I believe this is a violation of the Arizona Open Meeting Law with which the City Council must comply, and the Cultural Council has pledged they will also honor…but that promise has yet to be fulfilled.

{ 7 comments… read them below or add one }

Jeffrey Babcock September 16, 2011 at 8:43 AM

An interested observer from the sidelines since my departure from the Cultural Council in January ’10, I never cease to be amazed at the lengths to which Bill Banchs will go to denigrate his hard-working staff. The master manipulator who spins disinformation to his personal advantage, nearly always to the detriment of his organization, Mr. Teflon has managed, so far at least, to remain in power. But this latest overreach, a true abuse of power, may yet be his undoing. Banchs has created – and pretty much maintained without any questions being raised by his board – an almost unbelievably “hostile work environment.”

Yes, he’s been taken to task and his skills as a fundraiser challenged, but until this latest revelation the public has not been exposed to the deeply-seated paranoia that is at the heart of Bill Banchs’ day-to-day management style. Could there be a glimmer of hope that his sleep-walking “Stepford” board will finally awake and challenge Banchs’ excess? Given that groups absence of any real oversight, I doubt it. But hope springs eternal…

The City Council shares the blame for this ongoing nightmare. Without the City’s massive injection of support the Cultural Council would not remain in business for even a month. Yet Banchs and his board cronies vehemently defend their organization’s independence. Go figure.

I was delighted to learn that Vice Mayor Littlefield had the guts to request an audit of the SCC. Audits are conducted periodically, but those audits are perfunctory, superficial. This time, we can all hope that the City Auditor will dig into the details, the layers of detail where the real bones are buried.

As but one example of the self-serving manipulation that Banchs has used to preserve his position since being hired as CEO, I began attending SCC budget planning meetings in March of 2009, when I hired by Banchs. Those budget meetings, were also attended by my vice president counterparts, including then-interim director of the Scottsdale Museum of Contemporary Art Barbara Meyerson, then-CFO Jim Green, Valerie Vadala Homer, and Banchs.

It was at multiple budget planning meetings in April and May that Banchs informed Valerie that he was going to move $170,000+ from her City-designated public art conservation budget to the SCC’s operating budget to help close a very large hole in the projected 2009/2010 SCC budget. Valerie resisted asserting, correctly, that her public art budget was approved for specific projects and conservation by the City Council and could not be dismantled or used for other purposes.

Banchs was furious. He threatened Valerie with immediate dismissal if she did not comply with his direction. As CEO, he told our group our leadership group, he is authorized to reallocate any and all funds, including City-designated public art funds set aside for conserving the City’s public art collection. Under extreme duress, applied by Banchs over multiple weeks, then months, and now years, Banchs has waged a relentless, hostile, and outright war against Valerie Vadala Homer.

I believe that a careful review of SCC financial records will reveal that this large sum, plus additional funding in the years hence, have been shifted from City-designated public art budget into general operating funds, and that those funds have never been restored to the public art budget. Why? Because I heard Banchs say on multiple occasions during the spring, summer and fall of 2009, that there was no way he could afford to restore those funds to the public art budget because it would reveal a major gap. Further, he asserted, he wasn’t obligated to return those funds and Valerie didn’t dare challenge him on that because the Board of Trustees backed him up completely.

Where there’s smoke, there’s bound to be fire. And this is, in reality, but the tip of a very large iceberg.

As it was with Watergate and remains true today, if you want to discover what happened, “follow the money.” Assuming the City Auditor does just that, the trail will lead directly to Mr. Banchs and probably also to what many refer to as “Banchs’ Brain,” Jim Green. Green grew increasingly uncomfortable with Banchs’ direction during his tenure, even as early as when I left the organization. He challenged Banchs’ direction occasionally, but usually did as he was told, which put him increasingly in a deep, ethical hole of his own.

The tragedy of today’s tattered Scottsdale Cultural Council could have been avoided if the organization’s Board of Trustees had exercised even marginal vigilance. Instead, trustees have been Banchs’ co-dependents. As former chair, now City Council member Linda Milhaven noted to me and others in earshot, on multiple occasions, “We know Bill has issues and that he can’t raise money, but we can’t let him fail.” What she meant was that she would not allow Banchs to fail on her watch because she wanted to run for City Council. This protection of Banchs has come at a heavy price for the City and the City taxpayers.

The SCC today is a kind of “failed state” organization that is propped up only by a large, unaccountable taxpayer subsidy that virtually no other “independent” organization enjoys, especially in today’s economy. In return, the City gets nothing for its investment other than continuing scandal, terrible leadership, and an unwieldy bureaucracy that could be operated – easily for about half, possibly less than half, of the City’s current investment.

After nearly four decades of investment in the arts, the City of Scottsdale and its tax payers deserve a far more robust cultural program than is being offered under Banchs along with an efficiently and transparently managed arts program befitting the community’s long commitment.

May the sunshine of a serious, in-depth audit lead to the possibility, at long last, of disinfecting this horribly mismanaged organization.

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Turbo_az September 16, 2011 at 11:09 AM

Isn’t it sad that Banchs has the power to throw money down the drain? Thanks for always staying involved John and keeping us informed. Love the new website, by the way – awesome!

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guy phillips September 16, 2011 at 12:42 PM

If elected, one of my pet projects will be to give the $4 mil to the CVB who last quarter gave an astounding 43/1 ratio in revenue from city dollars spent, and give the CVB’s $500k to the CC, who is complaining of financial woes and yet can’t seem to say where the money went.. what a joke. Oh, yeah, and split up the CC too!

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Michelle September 18, 2011 at 5:32 AM

I like that idea, Guy! And I didn’t realize that the CVB converted so well. Impressive!

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Johannah October 1, 2011 at 5:11 AM

What’s it take to become a sublime expounder of prose like yroueslf?

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John October 1, 2011 at 8:45 AM

Easy, years of brain damage from beating one’s head against city hall!

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Jess September 18, 2011 at 9:45 PM

I agree that the SCC should be completely restructured. At least allow public art to spin off from the SCC and then completely rethink and overhaul the sad remaining pieces. The story above illustrates what many in the arts community already say about Linda Milhaven – that she is an opportunist who has used the arts and SCC for personal gain and the results for Scottsdale have been disasterous. She needs to be held accountable for the rein of incompetency that defines the Bill Banchs era. Under Milhavens watch the SCC went from a well managed, highly respected organization that Scottsdale could be proud of, to an embarrassing mess that has no leadership, no accountability and is rife with cronyism and abuse. I agree that we are not getting a fair return on our investment with this racket. Get rid of the unnecessary, top-heavy bureaucracy and equal service could be provided for much less than the $4 mil restricted gift provided compliments of our tax dollars. The damage done to our city’s reputation is so great that actually restructuring is too passive of an approach. We will need to get rid of the SCC altogether and start from sctatch. We deserve nothing less!

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