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NARRAGANSETT ‚ÄĒ Auditor General Dennis E. Hoyle released his audit report on Daniel E. Doyle, Jr.‚Äôs failure to repay funds to the both the University of Rhode Island and the state. Doyle, who has served at the Executive Director for the Institute of International Sport at URI since 1986, was audited after concerns were expressed to the Auditor General‚Äôs office about the unfinished state of the institute‚Äôs residential and coaching center, for which a state grant of $575,000 was given in 2007.
‚ÄúI was asked by the Joint Committee of Legislative Services (JCLS) to do a grant review which was pretty focused on one grant for $575,000 which was to build the residential and coaching center. After release of the report yesterday, the speaker has forwarded my report to the state police for their follow-up.‚ÄĚ
‚ÄúWe knew the building has not been completed,‚ÄĚ he added. ‚ÄúIt is somewhat of a shell and doesn‚Äôt have heating, electricity, or plumbing. We were provided with documentation of $163,400 of the $575,000 grant [from Doyle] that was in the form of cancelled checks, but we didn‚Äôt view that as complete documentation.‚ÄĚ
Hoyle‚Äôs report states that Doyle has not properly accounted for a number of financial statements which detail the operations and payments of the institute, although the audit itself was for the $575,000 grant only.
The report found that repeated requests for basic financial information on the grant‚Äôs use were not completed, IRS Form 990 filings were consistently late, and annual independent audits of the Institute‚Äôs financial statements were not conducted.
‚ÄúNormal financial accountability measures appropriate for an entity of the Institute‚Äôs size were not evident during the course of our review,‚ÄĚ stated Hoyle‚Äôs report. ‚ÄúWe noted various situations which we believe are indicative of a general lack of financial accountability within the organization.‚ÄĚ
‚ÄúThe Institute needs to significantly improve its financial accountability, particularly since it is largely dependent upon grants and other support from governmental and private organizations,‚ÄĚ it continued. ‚ÄúThe Institute should implement appropriate financial control measures along with routine oversight processes and procedures (e.g., independent annual financial audits).‚ÄĚ
Doyle also owes $380,000 to the University of Rhode Island. He was first hired at URI on June 29, 1986 as Special Assistant to URI‚Äôs Vice-President of Development, at the time Jim Leslie. His salary, healthcare and benefits were paid for by URI.
‚ÄúOn Aug 23, 1988, there was a contract between the Institute for International Sport as a non-profit, tax exempt organization and the state of Rhode Island‚Äôs Governor‚Äôs Office of Intergovernmental Relations,‚ÄĚ said David Lavallee, Public Information and Communication Specialist at URI. ‚ÄúThe state agreed to pay as part of that contract $175,000 for the performance of duties to run the Institute. This was the first contract that guaranteed the Institute money from the state.‚ÄĚ
‚ÄúAccording to a verbal agreement which ran from 1988 to 2000, some of that money was supposed to come back to URI for reimbursement of Doyle‚Äôs salary and benefits,‚ÄĚ he added. ‚ÄúOn July 1, 2000, we codified the agreement for the reimbursement process. That put the verbal agreement into writing. The contract basically said that all contract expenses, salaries, and benefits would be reimbursed to the university.‚ÄĚ
The Auditor General‚Äôs report included statements on Doyle‚Äôs failed repayments to URI.
‚ÄúThe July 1, 2000 agreement requires reimbursement of the salary and benefit amounts paid on behalf of the Institute,‚ÄĚ stated the report. ‚ÄúWhile such use of the State‚Äôs payroll system was formalized in an agreement, we believe the practice is questionable and should not be continued or repeated. It affords access to State benefit programs that would otherwise be unavailable to Institute employees.‚ÄĚ
‚ÄúFurther, it puts the University in an unintended business relationship with a private organization by advancing funds thereby creating a vested interest in their viability in order to collect amounts owed,‚ÄĚ it continued.
In recent years, the university has taken steps in trying to afford Doyle the opportunity to pay back his debt, but URI has yet to receive any money.
‚ÄúIt was in 2006 to 2007 when the university really started becoming concerned about payments and Doyle‚Äôs ability to make good on repayments,‚ÄĚ said Lavallee. ‚ÄúOn July 8 2009, we developed a repayment process that was agreed to by the institute in principle. The Doyle‚Äôs have indicated in published reports that they are good for their obligations.‚ÄĚ
‚ÄúWe issued a leave without pay to him in November 20, 2011,‚ÄĚ he added. ‚ÄúThat is a step we took to stop any more payments made through the university. We‚Äôve approached this in the way that we did because it was considered the most cost-effective.‚ÄĚ
The Institute for International Sport has been praised by the state and URI for its successful work with scholar-athletes over the years. It has received approximately $5 million in grant monies from the state for a number of programs, and is recognized throughout the country for its World Scholar-Athlete Games.
‚ÄúHe ran some excellent programs for young people, and the mission was a good one,‚ÄĚ said Lavallee. ‚ÄúThe state leaders believed that too, and they heavily invested in seeing this thing succeed.‚ÄĚ
The university owns the land which the unfinished buildings sit on, and do not know as of yet how they will recoup Doyle‚Äôs debt if he cannot himself repay the university.
‚ÄúNegotiations on acquisition of those buildings have to involve us, and we are actively looking at that property as one way to recover the obligations of the institute,‚ÄĚ said Lavallee. ‚ÄúThere are significant real estate issues that have to be looked at before we would do that.‚ÄĚ
‚ÄúThe Doyles have indicated that they are committed to making good on these obligations, so that could still happen,‚ÄĚ he added. ‚ÄúWe are still working on this, but we‚Äôd like to see some good use of those facilities.‚ÄĚ