November 29, 2011
Rio Nuevo District Is Committed To Financial Responsibility
Over the last 18 months the newly reconstituted Rio Nuevo Multipurpose Facilities District (“District”) Board reviewed thousands of documents on payouts and finance related reports. Many taxpayers have expressed concern that the District Board has been unable to provide an accurate accounting of cash on hand and funds available for investment in new capital projects. The District Board has been working to establish a solid baseline accounting of District funds with the City of Tucson (“City”) who managed the District for over ten years.
The District’s accountants and auditors advise they have been furnished with what appears to be various account summaries, reports and a select few internal work papers, not copies of actual source documents or backup for disbursements.
Below is the list of the documents that have been repeatedly requested by the District to be produced by Wells Fargo Bank (“Wells Fargo”). It is expected that these documents from Wells Fargo will allow reconciliation of the District funds.
The District has requested and still requires that Wells Fargo furnish:
a. complete list of all District Accounts since inception on each issuance of COPS, Bonds or other matters of which Wells Fargo has knowledge.
b. complete copies of the transaction history for each District Account, from the date the account was opened to the present day.
c. complete copies of all records relating to the disbursement of funds from each District Account, including any invoices, disbursement requests, back up materials or other information or documents submitted by City, District representatives and/or City or District vendors supporting the requested disbursement or other release of funds.
d. complete copies of the Trustee’s or the Trustee’s accountant’s work papers relating to all the District Accounts.
e. complete copies of the actual monthly bank statement for each District Account (not “asset reports, transaction reports, or account summaries”, etc.).
By source documents, the District’s accountants mean contemporaneous account documents prepared by Wells Fargo itself. Not summaries or reports prepared after-the-fact by City or Wells Fargo relating to District’s accounts (not “asset reports, transaction reports, or account summaries”, etc.). The District’s accountants have also advised that more detailed documents relating to the District’s Certificates of Participation (COPs) and Bonds should be on record and obtainable from Wells Fargo.
The District again requested these items via letter dated November 14, 2011 to the legal counsel obtained by Wells Fargo as of October 3, 2011 (see attached). In this letter, the District requested a meeting with Wells Fargo and its counsel to address the issues.
We continue to believe the information and documents should be securable without unnecessary action if we can obtain a meeting. A meeting may be held within the next week or so. The ability to obtain and reconcile the financial and accounting service records is intended to eliminate suspicions, reconcile its unobligated cash position, and allow the District to allocate productively remaining uncommitted funds.
Once the District resolves this issue, it is hoped we can all move forward as swiftly as possible to properly allocate District resources. To accomplish this, the District needs full access to and unfettered control of its bank accounts.
