The following is the text of a letter sent to Boston Mayor Tom Menino from Matthew Cahill, the executive director of the Boston Finance Commission.
February 23, 2012
The Honorable Thomas M. Menino
Mayor of the City of Boston
Boston City Hall, 5th Floor
Boston, MA 02201
Dear Mayor Menino:
The Finance Commission has been examining the City of Boston contract for the operation of the swan boats at the Boston Public Gardens. The latest request for proposals for this service was recently advertised and had a submission deadline of February 21, 2012. There was only one response and it was from a company named Swan Boats Inc.
The contract allows the vendor to generate revenue from gross ticket and souvenir sales. The vendor compensates the city by paying The Fund for Parks and Recreation an annual fee of $5,000 and 2.75% of the gross ticket sales, as well as 50% of the net income from souvenir sales. According to documents provided by the Parks Department, these figures are as follows:
Year Boat Receipts Souvenir Total Total to “The Fund”
2010 $470,552 $6,948 $477,500 $21,414
2009 $450,280 $5,741 $456,021 $20,253
2008 $475,417 $3,604 $479,021 $19,876
The Finance Commission is interested in reviewing the vendor’s financial reports, which were required under this contact, to better understand the operating costs. The Parks Department informed us that, though the vendor has provided some figures, they have not provided a full audit nor does The Parks Department have the time to personally undertake the task. This is unacceptable. Since The Fund generates revenue partially through a percentage based formula, it is incomprehensible that The Parks Department has not required the vendor to provide a full accounting of revenues and expenses.
Prior to the awarding of the latest contract The Parks Department should demand that the vendor provide a full accounting of their operational costs which outlines all revenues and expenses, including owner and employee salaries and/or payments. Due to the fact that this is a cash operation, Parks should also require any future vendor to use a point-of-sale register that will fully account for all sales transactions.
The swan boats have been operated by the same vendor, the Paget family, since 1877. Though the boats are a tradition in this city, the financial reporting must adhere to modern practices.
The boats are unique and symbolic of our great city, but this vendor is utilizing taxpayer land and therefore required to operate with the same transparency as all City of Boston vendors.
Very truly yours,
Matthew A. Cahill
Executive Director