VisitDallas CEO borrowed $225,000 from the nonprofit

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VisitDallas

Updated  Jan. 17, 2:22 p.m.

A VisitDallas spokesman said that the nonprofit’s CEO, Phillip Jones, has repaid the $225,000 in loans that he took from the nonprofit over the last several years. Spokesman Frank Librio said more recent accounting and tax documents will show the repayment of those loans, which Jones had taken out to cover medical treatments for his adult disabled son. The loans were not fully disclosed on federal tax forms, and Librio had earlier declined to provide any other documentation. He has since agreed to agreed to provide more documentation to The Texas Monitor.

Librio said the loans were taken out against a $400,000 retention bonus that had been promised to Jones in 2013 if he stayed with VisitDallas for five years. Librio said Jones has fulfilled the contract, which meant he could repay the loans.

Jones said that his son’s health insurance doesn’t cover many of the costs of his care, which then must be paid directly.  “As any father would, you do what you can to keep him alive,” he said.

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A lot of folks might wonder why a guy who gets an almost $28,000 paycheck every two weeks would need a $35,000 loan. But Phillip Jones, CEO of Dallas’ beleaguered convention and visitors’ bureau, apparently did in 2015, and he got it from his employer, the nonprofit officially known as VisitDallas.

That was not the only loan he’s received. According to the group’s most recent tax returns, he now owes VisitDallas $225,000. But the reason for the money owed remains a mystery.

The discovery comes as VisitDallas is currently the target of city scrutiny, after an audit found rampant misspending by Jones as well as poorly maintained financial records. As a result, Jones’ job, which he has held since 2003, is in jeopardy.

The audit found that Jones has spent freely on private car services, hotel rooms, and gifts for unknown people between 2016 and 2017.

VisitDallas’ 2015 tax return showed Jones as owing $135,000 to the organization, including the $35,000 loan.

The group’s 2016 return showed no new loans, but his balance had escalated to $225,000. Tax forms from previous years showed no earlier loans or other explanations for why Jones would owe money.

“That’s a substantial sum of money to borrow from a public entity,” said Dallas City Council member Scott Griggs.    

In an emailed response to a message regarding the debt and the $35,000 loan, VisitDallas spokesman Frank Librio said that Jones’ five-year contract starting in 2013 included a retention bonus, which he received in advance. But he failed to answer questions about how the advance resulted in a $225,000 debt and how that transaction was documented. He also did not address the $35,000 loan that was rolled into the same transaction.

Separately Librio told the real estate website Candy’s Dirt that “the loan was tied to a private family issue with the Joneses’ adult son, who is … disabled and enjoys living in Southlake.”

Dallas City Council member Jennifer Gates said in a text that Jones “has prepaid his retention bonus. Every year he stays, a portion is forgiven.”

Gates, one of two Dallas City Council representatives on the board of VisitDallas, also chairs the council’s Government Performance & Financial Management Committee, which oversees the tourism nonprofit. But she said she had no more information on the loan figures and gave no details of a “prepaid retention bonus.” That arrangement is not mentioned in the tax forms.

Federally tax exempt nonprofits are required to disclose loans to employees, relatives and other interested parties on their 990 forms, which nonprofits file in lieu of tax returns.

The recent audit found that metrics regarding the performance of VisitDallas are dubious, including the group’s claims of the economic impact of various events on hotel occupancy rates.

Auditors said VisitDallas could provide “no independent validation of the source data … for calculating economic impact … .”

Jones’ base salary has more than tripled since he came to town from the Louisiana Department of Culture Recreation and Tourism in 2003, from $172,000 to $669,000.

Between 2013 and 2017, VisitDallas received more than $146 million in city tax funds, much of it from the city’s hotel occupancy tax, according to tax returns.

“The reason you see people getting into trouble over these convention bureaus is that they do not provide hard metrics on what they are doing,” said Marshall Murdaugh, a former convention bureau CEO for New York City and the state of Virginia and president of Marshall Murdaugh Marketing in Richmond, Va. After looking over VisitDallas information, he noted that it included only vague tourism numbers that may or may not be directly tied to the work of the agency.

“People in those top positions should know that you have to let people know the exact number that is tied to the work of the agency,” said Murdaugh, “You cant just say, ‘This is how many people came to Dallas and stayed in hotels.’”

The agency has had accountability and spending problems in the past. Jones replaced former CEO David Whitney, who resigned in 2003 amid questions about his expenses and his severance package of $308,000. In 2006, a city assessment of the convention bureau noted that the agency had implemented tighter controls on spending through stronger internal oversight.

Among the highlights of the new proposed city budget is a major “contractual payment” to VisitDallas. The amount will be based on the revenue from the hotel tax, and has not yet been determined.

The Dallas City Council is scheduled to discuss the audit and consider the renewal of the contract with VisitDallas on Feb. 1.

Steve Miller can be reached at [email protected].

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