WAUKESHA - An
audit of the Waukesha County Museum made public Wednesday showed
that it’s stable, but must find additional funding to remain
Museum officials also released an operations plan
to improve the museum’s bottom line. Two plan goals: Continue
discussions with Waukesha to gain city contributions and
negotiate a long-term agreement with Waukesha County for annual
operational and capital money.
President/CEO Dan Finley and Museum Board Chairman Tom Constable
talked with The Freeman about the audit findings and the
museum’s plans to strengthen operations and revenue.
The two museum
officials presented the information to Waukesha County officials
earlier in the day.
conveyed to us is that they’re stable, and they will have to
work hard to continue to be stable,” said Norm Cummings,
director of county administration.
showed the museum had net assets of about $2.4 million at the
end of its 2013 fiscal year in June, down from the $2.66 million
at the beginning of the year.
The loss was
due to several writeoffs that the museum was forced to absorb in
its 2013 fiscal year because the expenses could not be
* $117,000 in
expenses for the design and construction of the original Les
Paul exhibit site that later was relocated;
* $22,000 in
gift shop merchandise that is now considered junk;
* $50,000 in
unfulfilled pledges for renovation;
taken from restricted funds to pay debt.
noted deficiencies in the museum board of director’s internal
“We note that
the board of directors did not have effective oversight of the
organization’s financial reporting and internal control,” a
letter from the audit firm of Walkowicz, Bockiewicz & Co. of
authorized the museum CEO, who was then Kirsten Lee Villegas, to
enter into a construction contract for the Les Paul exhibit,
“but did not provide appropriate oversight as the project
progressed,” the letter said.
The board did
not verify that sufficient funds were available to cover the
cost of the exhibit, the letter said.
found that $59,000 was taken from restricted funds without board
permission to cover exhibit costs, Constable said.
responded with a letter that states: “It is now understood that
as we move forward more oversight is necessary and appropriate.
This applies to regular museum activities, whether or not major
construction is involved.”
As the Les
Paul exhibit reached its completion in June 2013, “the truth
about whether or not adequate funds were available was
obfuscated. The board’s failure was it trusted but did not
verify the validity of assurances,” the board’s response letter
The board has
installed measures to ensure better accountability.
were increased from six to 12 times a year. A separate account
was established to hold funds that are donated for specific use.
Those funds can only be used with board approval, Constable
one negative of the audit,” Constable said.
financial health came under scrutiny last fall after Villegas
departed and the county cut its annual contribution to the
museum by half to $150,000. The museum must find a way to
replace the lost $150,000, Constable said.
Finley said an
example of the museum’s cash flow problem is that it gets only
$12,500 monthly from the county, but its most recent monthly
electric bill was $7,200.
“We were doing
OK when the county gave us $25,000 a month,” Finley said.
continued financial support, the county demanded that the museum
show financial stability and create an operations plan.
submitted to the county calls for the hiring of an executive
director at a salary up to $10,000 less than what Villegas was
being paid. Two of the museum’s five full-time positions were
eliminated, saving $80,000.
officials will establish a “friends” group for the west side of
Waukesha County to raise money. An advisory group of past board
members will be created to secure added financial support.
will evaluate current exhibits and unused space. A marketing
plan to increase paid admissions also will be designed.