State commerce secretary expensed pricey office furniture, hotels, dinners

TAMPA (FOX 13) - The man who has spent the past few months urging lawmakers to pour tens of millions in additional state dollars into Enterprise Florida Inc. -- warning lawmakers its economic development fund is running dry -- spent the same period of time eating at lavish restaurants with EFI staffers and staying at expensive hotels on the quasi-governmental entity’s dime, according to documents reviewed by FOX 13.

Bill Johnson, who became Florida’s secretary of commerce and EFI’s CEO in March, submitted expense reports and racked up credit card charges totaling thousands of dollars during his first few months as leader of the state’s public-private economic development organization.

A $6,600 order for four custom-made office lounge chairs for Johnson’s office, charged to his EFI credit card and paid for by state dollars, was refunded by the furniture company a few days after FOX 13 requested public records of his expenses.

Because Enterprise Florida, Inc. is a public-private partnership, it doesn’t follow the same rules as government agencies. By state statute, 50 percent of its operating fund is supposed to come from the private sector. In practice, it’s far less: Taxpayers foot the bill for 91 percent of EFI’s operations and programs, according to EFI’s most recent financial audit, and direct private investments totaled less than $2 million last year.

EFI primarily makes up for the private funding gap by using millions of dollars kicked in from Visit Florida, the state’s public-private tourism group.

FOX 13 reviewed Johnson’s expense reports and credit card statements from a three-month period over the summer. The investigation found that the small portion of funding that does come from private money often pays for the kinds of expenses that wouldn’t pass muster in government:

• Johnson and two other Enterprise employees had dinner at a premiere Tampa seafood house in May for a grand total of $359. Johnson’s expense report lists the business justification for the pricey dinner with his assistant and Enterprise employee Max Stuart as “discussion of area politics and strategy.”
• The same month, Johnson had dinner at Red, a Miami steakhouse, with Doug Wheeler, his former colleague from his job at Florida Ports. The tab totaled $374 as they talked about "strategy development.”
• In a three-month period, he expensed multiple dinners with his assistant, describing them as "planning” and "working dinners," with checks exceeding $100 on at least two occasions. 
• One June 8, he stayed at the JW Marriott in Orlando, expensing a $168.55 dinner at the resort’s steakhouse that evening.  Earlier that day, Johnson called lawmakers' unwillingness to comply with Enterprise Florida’s incentives funding request “shameful,” a statement he’d later apologize for. The expense report doesn’t list any business guests at the meal, but says he was there for a Florida Power and Light speaking engagement.
• Between May 1 and September 1, more than $1,000 in expenses were charged to Johnson’s EFI American Express card for monthly membership, meals and drinks at the Governor’s Club, a private club in Tallahassee.
• EFI also footed the bill for pricey hotel stays for Johnson, including $500 for a night at the JW Marriott in New York City and $378 for a night at the W Hotel in San Francisco.
• In August, EFI’s board authorized $765,000 bonuses for 79 employees. Only private dollars were used for the “staff bonus pool,” according to unofficial minutes of the meeting. Johnson, who earns a base salary of $265,000, received a $50,000 bonus from the pool after six months on the job.

Johnson, through EFI spokesman Stephen Lawson, declined multiple requests for an interview.

Lawson repeatedly defended the charges, saying “100 percent” of Johnson’s charges are paid for with “private dollars.”

But FOX 13 learned some of the charges had been paid for by state taxpayers.

On June 30, an order was placed for custom-made lounge chairs for Bill Johnson’s office, charged to his EFI credit card and paid for in July. The order form, which indicates custom orders are “not cancelable and not returnable,” shows the total cost was $6,662 for the four chairs.

“Within the records you will see a charge for office furniture for Mr. Johnson. That charge has been cancelled,” Lawson said in an email when EFI first provided the requested records.

“They were not the chairs meant to be ordered,” he first told FOX 13, when asked for an explanation.

The records, however, did not include documentation of the charge being credited or cancelled. FOX 13 obtained additional documents through a subsequent public records request that showed that a refund from the furniture company was applied to the credit card just a few days after FOX 13 requested Johnson’s expenses -- six weeks after the order was placed. The original credit card charge had already been paid for using state dollars. American Express issued a refund check in September, and the funds were applied back into state funds. 

Johnson’s spokesman, who had repeatedly said “zero” of Johnson’s charges were paid with state dollars, told FOX 13 on Wednesday that the lounge chairs were, in fact, paid for with tax dollars.  

“Operational costs, such as chairs, are state-funded,” Lawson said. “However, once the purchase error was identified, a full refund was issued, and Enterprise Florida is not in possession of those chairs.”

St. Petersburg Rep. Dwight Dudley says the expenses are concerning.  

"Talking about chairs that cost $6,000. What, their derrieres are so special they can't have regular office chairs? That just seems completely wrong,” he said in an interview after reviewing the documents.

Operating Funds and Incentives Funds

Most of the funding debate in Tallahassee has centered on EFI’s jobs incentives fund, used to close deals with businesses who agree to create jobs in the state.

“If we don’t have the resources, there’s no need to have an EFI,” Johnson said a June conference call, when lawmakers had not allocated the full $85 million requested for the fund for the 2015-2016 fiscal year.  

Lawmakers ultimately agreed to put another $43 million in the pot; in September, Johnson asked for another $85 million for next year. Gov. Rick Scott, EFI’s chairman, recently upped the ante by proposing a multi-year, $250-million plan for the fund.

All of that is on top of millions of dollars the state kicks in for operating expenses, which are currently budgeted at $25 million.

EFI’s request for more jobs incentives funding has drawn questions from some lawmakers, who pointed to $134 million sitting in a minimal-interest escrow account last month. The account, earmarked for businesses which have a job development contract with EFI, reverts back to the general fund when the companies don’t meet certain objectives by set deadlines. Since 2009, more than $37 million in has been returned from the escrow account to the general fund, public records show.

"The vast majority of their budget is coming from Floridians -- everyday working families,” said Mark Ferrulo, executive director of the liberal watchdog group Progress Florida, which has long been critical of the agency.

Ferrulo says if Enterprise can’t hold the line on privately paid expenses, taxpayers shouldn’t be asked to pay even more.

"Here is a quasi-governmental agency that's asking the legislature for tens of millions of more dollars each year,” he said.

He says EFI has long used “private dollars” to explain expenses that raise eyebrows, like staff bonuses and expensive job recruiting trips to Paris.

"Now after seeing this information you provided in the expense reports, it makes one wonder if some people see it as just sort of a slush fund," he said.

FOX 13 also reviewed expense reports for former EFI Chief Operating Officer Griff Salmon, who left his position at the end of September to work for a private-sector firm. 

Salmon’s expense reports listed reimbursement requests that did not exceed the state per diem limits: $19 for dinner, $11 for lunch and $6 for breakfast.

Johnson’s meals fall under different rules, Lawson explained.

“Per diem meal limits are for state dollars only,” he said. “Since zero of Bill Johnson’s charges were paid with state dollars, this does not apply.”

Gov. Rick Scott, EFI’s chairman, did not respond to an interview request. Two weeks ago, he told board members “call everyone” they know in the House and Senate about his quarter-billion-dollar funding proposal.

“If we don’t talk about the importance of this, it’s not going to happen,” he said at the October meeting. “If we don’t do this, it’s a big mistake for our kids and grandkids.”

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