Wednesday, August 22, 2007

Just like the Stones, one more final post on this subject ...

So the Mayor has made his appearance before the Ethics Board. He wanted to make sure that things were clear, and that the people of the city could see matters were set to rest. He explained to the board that, even though someone paid $9000 on his behalf, it all went to charity. He received nothing of value. From the PG

“The only thing of value I received was knowing I played a small part in seeing the work of the foundation will continue," he said. "This was not a gift to me. I received nothing from UPMC”

It all went to charity.

Well, maybe not all.

Back at the end of July, KDKA and other news outlets had this story, about how much the Mayor’s golf game with the stars really was worth:

“City attorneys determined the Mayor did not receive a round worth $9,000, but received 18 holes of golf, which is valued at $246.75.

According the City Attorneys Office[sic], they followed IRS policy in terms of reporting the value of the item, in this case a round of golf.”

I had reported on this before. I can’t tell whether the city attorneys meant $246.75 for two days, or $493.50 for two days. Either way, the Mayor knew about this number Tuesday and didn’t mention it, quite the contrary he denied receiving anything of value (apart from a warm feeling). There ought to be a penalty for fibbing to the Ethics Board, but I guess the MSM will let this one go (too).


Char said...

The $246.75 is the most insulting part. First, what Generally Accepted Accounting Principals does one use to whittle $9,000 down to $246.75?

Then second, why not totally flip us the bird by having the calculated amount come to $249.99?

EdHeath said...

Well, I work in taxes during the tax season, so I am used to funky amounts offsetting deductions. It's not GAAP, its the actual cost incurred by the Lemieux foundation to put on the event, per person, reported to each participant. That number was used here to figure this amount (even though no deduction for Ravestahl is involved), so I am not insulted by the $246.75.

I am insulted at the claim that no amount of money was involved, after the announcement in July that a specfic amount was calculated.

McArdle said...

I don't think that this is pertinent. The tax deduction exists to encourage charitable giving, and is an important component of the tax code. It does not change the fact that it costs nine grand to go to this thing. Had the mayor paid for himself, that is the amount that would have come out of his pocket, and is, in fact, the amount that UPMC and the Penguins effectively gave him.

Had he been invited by the Mario Lemieux Foundation, then the $246.75 number would be the one to look at, but he was not.

EdHeath said...

Not surprisingly, I disagree, McArdle. First of all, the Mayor himself is on camera, referencing (approximately) this number, as the only value he received. Second, in this somewhat confusing situation, we ignore numbers at our peril. The 4500 per day, 9000 per person for two days, or 27,000 actually required by the Lemieux foundation for admission for 3 for 2 days will probably show up on some corporate balance sheet or promotional literature as corporate giving. Make no mistake, both the Penguins and UPMC both gave 27,000. The Pens gave two one day slots to the Mayor and the County Chief Executive, and UPMC gave one one day slot to the Mayor. I’m sure lots of corporations work it that way, giving up to six different people a round of golf with a celebrity. So the Mayor’s 9,000 is probably already claimed by the Pens and UPMC, possibly minus the $246.75 per day, if some tax deduction is being claimed. But suppose the Mayor and three friends found themselves at Laurel Valley by accident. They decide to play 18 holes. According to the IRS, without the $246.75 per person, golf couldn’t happen at all. Hence it is the value the Mayor took away.

I mean, I see your point about how much it really costs to go to this thing. In fact, let’s be honest, you have to pony up the whole 27,000 for a threesome, the fourth to be a celebrity. If you bring 9,000 to the gate, the Lemieux foundation will say “sorry” (well, they might try real hard to find a group missing a golfer).

The idea of the Lemieux Foundation “inviting” the Mayor next time is troubling to me, because the Lemieux Foundation is being asked to give up money. If the Mayor takes a spot in a threesome (not counting the celebrity fourth), do the other two people only pay 18,000 between them? And I don’t think the Mayor could be the celebrity, not if the Lemieux Foundation wants people to come back the next year.

At the end of the day, though, it just annoyed me that the Mayor came to the meeting and didn’t say what he had said on camera July 26.