The Milwaukee International Film Festival is mired in controversy that hasn’t been reported. It’s a juicy controversy pitting liberals against liberals, and also starring the Shepherd Express, Mayor Tom Barrett and the Greater Milwaukee Committee.
The film festival was developed in 2002, and since 2003, it has brought a wonderful slate of films that play at the Oriental Theatre. It was largely created by Shepherd Express owner, publisher and editor Louis Fortis and arts and entertainment editor Dave Luhrssen. As Fortis puts it in an e-mail response to me, “(the) Shepherd Express created from scratch without any grant or official blessing one of the most popular cultural events in the city.”
Festival insiders, however, say the financial support of Chris Abele and his Argosy Foundation was also critical. The foundation has annually provided a $50,000 grant to the festival, for a total of $250,000 over the last five years. That, in turn, may have helped the festival leverage regular support from the Herzfeld Foundation.
Fortis, in a back-patting essay that ran in the weekly, claims the Herzfeld Foundation was actually the festival’s first funder. Of course, Fortis is now at odds with Abele because both foundations have shut off the funding, endangering the festival’s future.
“A lot people follow Chris’ lead,” says a well-placed observer who is close to Fortis. “Herzfeld followed Chris’ lead (in withholding funding).”
Why? Fortis, sources say, has been demanding the festival repay some $250,000 he claims it owes the Shepherd Express. But since the festival has essentially been run by Fortis, Abele and others have questioned how this debt suddenly arose. Not satisfied with the answers, Argosy and Herzfeld have pulled the plug.
“I’d be sorry if they took the festival away from Fortis,” says a member of the Mayor’s Council of advisors to the film festival. “I don’t think he ran away with money. The fact that he disclosed the debt later is a problem.”
The festival’s murky organization raises more questions. For federal tax purposes, the festival is organized under a nonprofit called Milwaukee Future Foundation. But according to Mick Daley of the Wisconsin Department of Regulation and Licensing, the nonprofit didn’t file a 2006 tax form with the state, and signed a form claiming the festival wasn’t soliciting money that year. That’s odd, since the festival was getting funding from local foundations and businesses. (Fortis claims a 990 was filed with the state for 2006.)
At Guidestar.com, 990s are available for only the 2003-2005 years. The filings show the only board members of this nonprofit were Fortis and twoShepherd staffers in 2003, and just Fortis in 2004 and 2005. (Fortis admits the board has never had a board member that wasn’t a Shepherd staffer.) In his essay, Fortis writes that this “very small” board was created to avoid “factional fighting that has caused the demise of many successful nonprofit organizations.”
But it gets worse. In 2005, the nonprofit’s books were in the care of Matthew Astbury, who is the finance manager for the Shepherd. Given that the festival regularly buys ads from the Shepherd, this certainly presents a conflict of interest. “Louis was really making the financial decisions for the festival,” says one festival insider. “There’s been no proper oversight of fiscal matters.”
Consider this statistic: From 2003-2005, the festival had a total deficit of $94,423, and spent $94,164 on ads, which frequently appeared in the Shepherd Express. Without those ads, the festival would have broken even. The 2003 filing also shows a cost of $51,990 for “consulting,” but doesn’t disclose the consultant’s name or what service was performed.
Abele, observers say, has questioned how the Shepherd could on the one hand promote itself as the festival’s main sponsor, yet charge for ads it provided. Fortis says the Shepherd gave the festival “many free ads and when they charged they charged the lowest rate given to any nonprofit.”
In his essay last week, Fortis claimed the festival had “a shortfall of about 10-15 percent that the Shepherd Express would fill each year.” Given five years of operation and a yearly budget of about $350,000, that would suggest the Shepherd was owed some $218,000. But in his e-mail, Fortis now says the Shepherd is owed $110,000. That makes three different estimates of the debt.
Abele has pushed for an audit of the festival, and as Fortis admits, Greater Milwaukee Committee leader Julia Taylor is recommending an auditor to review the festival’s finances. Meanwhile, insiders say, attorney Matt Flynn, a friend of both Abele and Fortis, is negotiating between the two of them, trying to forge a truce. And Mayor Barrett is trying to distance himself from the whole controversy.
What’s perhaps most remarkable is that so many pillars of the community decided to fund a nonprofit with little separation from a for-profit company and no oversight by a real board of directors. Besides the Argosy and Herzfeld foundations, the festival lists the Brico Fund, Northwestern Mutual Life, the Jane Bradley Pettit Foundation, Harley-Davidson and others as sponsors. Did no one ask for a list of the board of directors?
The support of the Greater Milwaukee Committee and, after he was elected, Barrett helped sell people, says one donor. “He’s been a supporter of the festival. Definitely,” says Barrett spokesperson Eileen Force.
Any charitable gifts are tax-exempt with the understanding that they are going to a nonprofit. If it turns out the money was also supporting a for-profit weekly paper, that could be pretty embarrassing for a lot of prominent organizations.
The Bradley Center Blows It
There is more, I suspect, to last week’s story that the Bradley Center would back off from selling naming rights to the home of the Milwaukee Bucks. The center’s board of directors had proposed to rename the facility while somehow continuing to “honor” Harry Bradley, whose daughter, the late Jane Pettit, had paid for the center and named it after her father.
But last week, a letter from Pettit’s children, Lynde Bradley Uihlein and David V. Uihlein Jr., protested this. So why did they send the letter to the Milwaukee Journal Sentinel and embarrass Bradley board chair Ulice Payne, Jr. and his fellow board members? Why not just contact board members privately?
The two Uihleins maintain a low profile and seem like the last people to kick up a public fuss. The inescapable conclusion is they shared their concerns with the Bradley Center board, and got nowhere. So they went public and embarrassed the board into backing off.
Even more interesting, the Uihleins also urged the Bradley Center make renewed efforts to pursue a merger with the publicly run Wisconsin Center District, which directs the Midwest Express Center, U.S. Cellular Arena and the Milwaukee Theatre. Wisconsin Center board chair Frank Gimbel has in the past suggested a merger would mean dissolution of the Bradley Center board. This was unacceptable to Bradley Center officials, who claimed to be protecting the legacy of Pettit by insisting on an independent board. That claim began to look hollow once they began shopping to rename the facility.
So last week, Pettit’s children made crystal clear their priorities regarding her legacy. They don’t seem to care about an independent Bradley Center; they just want the Bradley name protected. Perhaps its time for Bradley officials to begin negotiating with the Wisconsin Center in that spirit.
And how about the Packer’s top draft choice? The Sports Nut considers.
