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Civic Skinny

Some questions and some answers about AIB deal. State stops some refunds. Channel 8 deserves credit.

2/25/2015

Some questions:

Who owns AIB? Every Iowan.

What if the AIB-University of Iowa deal falls through? Who knows.

Does the AIB board have to keep the school alive? No.

Can the trustees decide to sell the site to a developer? Under some circumstances.

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What circumstances? If they use the proceeds for educational purposes.

What if they don’t? Perhaps the attorney general could step in.

Perhaps? Well, it’s complicated.

The American Institute of Business was founded in 1927 By Everett O. Fenton, and 14 years later he incorporated it as a nonprofit organization. Since then, it has been owned by the public — at least in theory.

At least in theory because the Fenton family has maintained control, if not ownership, of the college throughout the years. When Everett Fenton stepped down as president in 1957, his son, Keith, took over. And when Keith Fenton stepped aside as president in 1998, his daughter, Nancy Williams, became president, a $180,000-a-year job she holds today. In a way, it’s like some mutual insurance companies — where policyholders are the “owners” but where somehow families keep control through several generations.

Now, though, the school is in financial difficulty, so Williams and University of Iowa President Sally Mason made what appears to have been a quick — if vague and nonbinding and secret — deal for AIB to give the campus to the University of Iowa, which would use the site on Fleur Drive as an urban outpost of the university.  The memorandum of understanding said the deal would include “the possible integration of AIB faculty, staff and students into the University.” But that aspect pretty much fell apart when the Board of Regents and others got wind of the deal.

At the moment, then, it looks like AIB is simply going to give assets worth $30 million or so to the university and get nothing out of it.

Under the law, that’s O.K. According to its tax return, AIB’s mission is “educational services,” and giving away the campus to Iowa probably comes under that broad definition. But some folks think it’s a dumb idea. Their only recourse is to go to the attorney general, and that probably wouldn’t accomplish anything.

The attorney general doesn’t protect us from dumb deals. He “has limited authority or powers over nonprofits,” according to Geoff Greenwood, the department spokesman. “The high standard for the AG to contemplate exercising that authority is met when there is evidence provided to the attorney general, generally through a complaint, that a nonprofit has clearly abandoned its stated core charitable mission. A complaint simply questioning the merits of a policy decision…would not trigger a request for judicial dissolution by the attorney general.”

He adds: “The issue for the attorney general is not whether the gift is in the best interests of the people. Rather, the issue is whether AIB is using its charitable assets in a manner which violates its charitable mission.” So the deal with the University of Iowa clearly fits the mission. But a sale to a developer or anyone else would have to be contingent on the board using the proceeds for “educational services.”

In case you were wondering. …

For the record: It was Channel 8, and nobody else, that did all the spadework on the story about Councilman Joe Gatto and his fixed ticket. …

If you didn’t get your tax refund on time a couple of weeks ago, there’s a reason: The Iowa Department of Revenue thought your return might have been fraudulent.

In all, about 1,500 refunds totaling $1,086,341 were held up during the Feb.4-6 period “in an abundance of caution,” the department spokesperson told Cityview. It’s all wrapped up in the nationwide fraud investigation involving state tax returns filed through TurboTax. In checking, the Iowa agency found 21 fraudulent returns, involving about $19,000.

The agency resumed writing refund checks on Feb. 11, but not before a lot of taxpayers complained. The department was “deluged with complaints,” says an agency employee. “Callers to the department are complaining that they have 25-minute waits and then are disconnected.”

The employee said direct deposits of Turbo Tax refunds that went into bank accounts were reversed and that callers “want their refund, want the agency to pay their overdraft fees, and want their credit repaired.” But Victoria Daniels, the department spokesperson, said no refunds had actually been deposited in any taxpayer’s bank account though about 800 refunds were recalled from the state’s bank. CV

 

Comment: Rick Green

The affable Rick Green is off to Cincinnati, so now we will get yet another publisher of The Des Moines Register.

That is not good news.

It is not easy being publisher of a newspaper. It particularly is not easy these days — when the industry is changing dramatically and no one really knows how the economics will play out. The Register doesn’t make its finances public, but it has been laying off workers regularly in recent years, and its circulation has plunged to the lowest levels in nearly 100 years. So either money isn’t pouring in over the transom or else it is being sent out in indefensible amounts to Gannett headquarters in Virginia. Both those options are bad.

Uncertainty is the only certainty in the newspaper business today. Indeed, it would be foolish to bet that there will be home delivery of the daily Register in five years. And if there is, it would be foolish to assume that there’s anything in it for readers older than 45 — traditional print readers but the upper end of the newspaper’s target demographic, in this aging state, both in print and on its loopy website.

So the Register needs all the help it can get. Time will tell if Rick Green set the Register off in the right direction — or the wrong one. But he had all but one of the skills needed to run the place. He understood news. He understood business. He got involved in the community, at least to a degree. And he was relentlessly upbeat, at least in public. An added benefit was that he truly cared about the First Amendment — in seeming contrast to a few of his predecessors — and spent some of his scarce dollars fighting for openness.

But he lacked one thing: He didn’t know the territory.

That’s a huge liability to overcome. (I know. I spent 15 months as editor of the Louisville Courier-Journal, where I felt like I was editing a newspaper with one hand tied behind my back. I didn’t know Mitch McConnell from Willie Shoemaker, though I grew to admire one of them.) An editor and a publisher must have a great knowledge — and a great affection — for their city and state, a knowledge that makes them confident of their facts and an affection that spurs them to comment truthfully about those facts. Good and bad.

It takes a lifetime — a lifetime of insatiable curiosity — to learn at least some of those facts. As for the affection, it’s kind of like falling in love. At some point, it just happens.

Rick Green knew nothing about Iowa when he came here from California to edit the newspaper four years ago; that’s not his fault, it’s the fault of people at corporate headquarters who look at newspaper editors and publishers as fungible goods and move them around like inventory to stock a store whose shelves are bare. But editors are not auto parts, publishers are not bananas. Rick Green is a quick study, and he learned a lot, about as much as you can absorb in four years, and he didn’t commit any awful gaffes.

But the whole time, I suspect, his heart has been in Cincinnati. He was born and raised in Ohio, he graduated from Ohio University, he spent 16 years in the newsroom of the Enquirer — and his eyes sparkle when he talks about his years there. He knows the territory — and he is in love with it. He’ll do a great job in Cincinnati. The paper is lucky the corporate masters didn’t pick someone for Cincinnati who grew up in Vermont, say — or Iowa.

But where does that leave the Register?

Can Gannett find someone who knows what Joy Corning and Jo Ann Zimmerman and Roger Jepsen and Sally Pederson and Terry Branstad have in common? Can it find someone who knows the stories of Jack Trice and Nile Kinnick? Who follows the price of soybeans and knows how many bushels an acre of corn produces in Hamilton County? Who understands the Iowa school-aid formula (well, that’s probably asking too much) and the history of liquor-by-the drink?

As well as someone who can build a rate card and reach those generations who think print is ridiculous and who text each other even when they’re sitting at the same restaurant table? Someone who can wring every dollar out of the budget to make sure the newspaper has the manpower to cover the courts as well as “Fifty Shades of Grey” and to summarize city council meetings with the same thoroughness it devotes to “Girls” and “The Bachelor?”

And figure out a way to price what editors and publishers increasingly call “the product?”

Good luck in finding that person.

And good luck to Rick Green, who is the right person for Cincinnati. CV

— Michael Gartner

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