Eastern Market Report


The Fog of Financials
The Eastern Market Community Advisory Committee (EMCAC) meeting on November 25th was an exercise in EMCAC members’ frustration. EMCAC which is tasked by law as an advisory body on all matters having to do with the Eastern Market had asked Market Manager Barry Margeson to provide them with answers to a number of budgetary questions and how costs are allocated.

The responses by Margeson only served to perpetuate the decade-long fog that has permeated the   Eastern Market finances. Among the Margeson’s responses that EMCAC members found perplexing were that the Market had lost $19,410 in FY14, made a profit of $233,503 in FY15 and then in another wild swing, a lesser profit of $25,857 in FY16.

According to Margeson the FY15 profit “is made up largely of PSD (Protective Services Department) and Facilities costs that were not reclassified. This means that PSD and Facilities were not reimbursed for services that they provided to Eastern Market.” No explanation was offered for why this reclassification did not occur.

Among the EMCAC Finance Committee questions directed to Margeson in advance of the meeting were those whose answers might offer some illumination on the precise costs of line items repairs and maintenance. Margeson responded: “We don’t have a precise breakdown of Repairs and Maintenance but I can tell you that a higher percentage of the work is repairs.” Asked about a breakdown of outdoor costs and indoor costs, Margeson continued: “I will have that by the next meeting.”

Margeson stated that it would likely be the case that these previously reclassified expenses to other agencies would once again not be reclassified in FY17, again providing no rationale in response to a query of Jonathan Pag , the Mayoral representative : “ If this year there won’t be reclassification will it be a similar number ( the $233, 503 in unclassified profit) “ ? Margeson responded: “It will be pretty close. Two hundred.“

Asked about the complexity of this reconciliation and budgetary process, Margeson again responded: “It is not extremely complex. Rather it is highly scrutinized. It is kicked back by the CFO who rejects it. The reclassification is extremely complex. It is not done very often and it is highly scrutinized by both the auditors and the CFO.”

Page asked: ”You have other years when this has happened?” To which Margeson responded: “It will happen this year. It is budgeted. And that is why you have a large sum because it was budgeted to go to PSD. It was budgeted to go to Facilities. “

Chair Donna Scheeder asked: “Where did the two hundred and thirty three thousand dollars go at the end of the year? What happens to the money?” Margeson responded: “It sits there. It doesn’t do anything. And then it is either sweeped or then it is……………….goes to the General Fund. “

The Eastern Market Act of 1999 (dc code 37-103) states that the Enterprise Fund is the legal repository of “all revenues proceeds and moneys from whatever source” at the Market and those revenues shall be deposited in the Enterprise Fund and not “at any time be transferred to, lapse into or be commingled with the General Fund of the District of Columbia.”

EMCAC does not receive monthly or regular reports on finances and does not participate in the DC budgeting process as the budgets go forward.

EMCAC members spent the entire discussion unsuccessfully trying to untangle the District’s budget process as well the allocation of costs leaving the membership as unenlightened as they were when the discussion began.

Richard Layman, an EMCAC member, stated: “No organization would not have this information. “

ANC 6B02 commissioner Diane Hoskins added: “These numbers do not tell us anything at all.”

Tom Kuchenberg, Chair of the Finance Committee, continued, “It strikes me that until we understand the metaphysics of the reconciliation process that we can’t make any rational recommendation to keep profit in the Market funds. I would love to have a deeper understanding of this whole process.“

Vice Chair Burger added: “I am tired of these circuitous talks about the budget. We never have timely information. We have a committee and we sit here and try to make common sense out of it.”

Scheeder concluded the discussion, stating EMCAC was going to do two things: “We are going to request a briefing from a representative of the budget office as to how this process works. And we are going to refer these answers and numbers on the budget to the Finance Committee and they will report back at our next meeting as well.“

The last Market audit which was made public was July 29, 2014 and was conducted for the fiscal years 2010-11.

Margeson has a strong history of sharing Market financial information when it is available to him.

As Scheeder wrapped up the discussion she added, ”Part of the problem here is that we used to get excellent financial information every single month. The comment has been that working with the government we are in a larger financial system that doesn’t necessarily respond in detail that makes sense of what is good for the running of Eastern Market. That is an issue that we must take a look at.“

Manager’s Report
Margeson reported there is no progress on the leases. Addressing the ongoing parking issue, Margeson reported that he had spoken to the Colonial Parking representative about the triangular surface lot on the 600 block of C St SE behind the US Post Office. According to Margeson Colonial is willing to do a Saturday/Sunday validation program where participating merchants or vendors pay the standard fee that Colonial charges of a $10 flat rate for customer parking.

October revenues $96,896.32 with North Hall revenue surging to $29,462. There were twenty five events, some pre-scheduled for the community, in the month of November.