Jefferson Banner - Opinion
John Foust - Chamber
What's wrong with the Jefferson Chamber of Commerce?

By John Foust

In our small Wisconsin city, still far enough away from Madison and Milwaukee to not feel the pinch of urban sprawl or even commuter traffic, the Main Street is cluttered with empty buildings.  Even at the four corners of the main intersection, once the lone stoplight in town, two buildings are empty and another has a not-so-busy craft shop, the other has a bank that's increasingly more empty after its sale to a conglomerate in Michigan.  Many buildings have been empty for years.

Against this backdrop, the local Chamber of Commerce struggles to improve the city of Jefferson...  doing important work like preventing members from running for its Board, hiding its spending details, obfuscating its funding sources, paying people not to work and to work for private businesses, overturning City Council votes, influencing public referenda and stifling public expression, promoting Internet businesses instead of local businesses, and investigating the lawn-mowing habits of its members.  Through this, downtown will be revitalized and Jefferson will be saved.

What does the Chamber do?

According to the Chamber's 1999 by-laws, "The Chamber's objectives hall be or [sic] propose and encourage progress in all fields it considers to be in the best interests of the community's business, industrial, professional and residential growth and development. The Chamber shall be non-sectional, non-partisan, non-political and non-sectarian."

The Chamber is associated with the City, right?

It's not a part of City Hall or an official government organization, if that's what you mean.  The Jefferson Chamber of Commerce is a private, non-stock, not-for-profit corporation.  It exists to promote the interests of its members.

I can see why you might be confused, though.  If you've ever seen a letter from the Chamber, it came on letterhead like this:

which looks exactly like City of Jefferson letterhead.  This might give you the impression that the Chamber, the Commerce and Industry Association (CIA), and the Jefferson Development Corporation (JDC) are one and the same with the City.  They're not, and they've fought very hard to try to remain as secretive as possible.

Mind you, the CIA is a creation of the City, and the JDC is the quasi-governmental private corporation that oversees the City industrial parks, and the Chamber is a private organization - and all three are hosted in the City-owned Carnegie Building.  Only the Chamber pays rent, though - $75 a month.  The private JDC pays nothing.

You might also be confused by the fact that all three groups are represented by one person with many hats, the Executive Director, whose salary comes 100% from the City.

Who's that?

That's the Chamber Executive Director David Olsen, touting the benefits of using online travel sites as opposed to local travel services.  That's his face on the cover of the February 6, 2000 issue of Access, an Internet magazine inserted in dozens of newspapers across the nation such as the Milwaukee Journal and the Wisconsin State Journal, and reaching millions of people.  A second picture of Dave and his wife is inside, too.

Inside, Olsen says "When I called a travel agent to book the flights, she couldn't believe the rate. She said it was too good to be true." 

Not only that, Olsen had already planned his vacation and made travel reservations at two local travel agencies, then cancelled when he got the better deal online.

In this big new world, there is certainly tension between Internet travel agencies and hometown travel agencies.  Frankly, I've bought tickets both ways.  Sometimes I'll use the web to find a flight, then walk across the street the travel agency to actually buy it because it's the same price.

But if you were Executive Director of the local Chamber of Commerce, don't you think you'd need to come down on the side of local business when it comes to 4-color, front-page public statements opposing local business that clearly identify you as director of the Chamber of Commerce?  Wouldn't the apparent conflict of interest or the appearance of hypocrisy cross your mind as you made the many separate and consecutive decisions to cooperate to get your face on the cover?

Chamber fundraising

As small-business member of the Chamber, you might pay about $130 a year in dues.  The rates paid by Chamber members is a secret, too...  however, the system doesn't make much sense.  Charities pay more than businesses?  Sure, why not.  St. Vincent de Paul was asked to pay $190, and Opportunities (who employs the handicapped) paid $255, but Jefferson Cold Storage, a large employer, pays only $180.  F&M Bank paid $1,570, but PremierBank only paid $775.

However, none of those Chamber dues pay the salary of the Executive Director.  Instead, the Executive Director's salary is paid by the CIA, who (until 2001) gets the money from the City of Jefferson and the Water and Electric Department.

As a Jefferson taxpayer in the past, you contributed to the Chamber in two ways:

  • One, through your City taxes.  In the past, the Chamber has received several thousand dollars a year in general funding from the City Council. In 1998, the Chamber received $13,000 with no strings attached.  In 1999, it was $6,000.

  • Two, the City Council gives $43,200 a year given to the Commerce and Industry Association to hire the Executive Director of the Chamber.  That's right, the taxpayers of the City of Jefferson is paying the salary and benefits of the day-to-day director of a private organization...  with full health benefits and three weeks paid vacation a year, and no time clock to punch.

Chamber spending

So the Chamber collects dues, and is given money and subsidy by the City Council, and conducts its own fundraising, but they don't pay for the Executive Director.  How is this money spent?

You can't see the details even if you belong to the Chamber, much less so if you're just a taxpayer.  

The Chamber will give a general financial statement to Chamber members, but it only shows a single amount for income or expense on a per-project basis.  It doesn't show the details of how the money was actually spent, item by item.  In fact, you won't even see those details if you're on the Chamber Board of Directors.

In the Chamber election of September 1999, I gathered enough signatures to force a referendum to let the membership vote on a proposed amendment to the by-laws that said:

"All records and books of account of this corporation shall be kept in the Chamber office. Any Chamber member shall be able to inspect and copy these records during normal business hours.”

Seems simple, doesn't it?  If you belong to the Chamber, you should be able to know how your money is spent.  Don't confuse this with my open records battle with the JDC and CIA.  I wasn't trying to open the Chamber's records to the public - only to its dues-paying members.

The Chamber Board viewed this amendment as an affront, and held a special meeting to concur the Board was against it, and included this letter from the President along with the ballot.  To be fair, they let me include a letter with the ballot, too.

The proposed amendment failed: 42 opposed, 13 in favor, or 72% to 23%.  Out of approximately 190 ballots sent, only 55 were returned, for a weak 28% voter turn-out.

Due to the ambiguous by-laws regarding Chamber membership and voting requirements, it's also possible that some people (two Board members, in fact) are allowed to vote twice - once for the vote held by the membership of the company they work for, and once for their individual membership in the Chamber.

Amazingly, you don't even need to pay dues to remain a voting Board member.  In 2000, the representative from Generac, one of the largest employers in town, hadn't paid its hefty $1,035 dues as of July, yet he remained on the Board.  Also, the Chamber admits members who don't pay at all.  In this fashion, it's possible that the Executive Director could vote three or four times - for the Chamber itself, for the Jefferson Development Corporation, and for the Commerce and Industry Association.

Are the records available, or not?

In the following months in 1999, the Chamber newsletter's "Letter from the President" continued to give the impression that Chamber records were open to anyone who wanted to see them.

I'm not revealing private communications or Chamber business here. The Chamber newsletter is freely given to the public at the Chamber office, and sent to many businesses in town, including businesses and people who aren't Chamber members.  I was also given a copy of the Chamber by-laws many months before I ever become a member.

In the October 1999 issue, President James van Lieshout said:

"My thanks go out to all of you who voted on the open records referendum.  By a 3:1 margin, the members decided to allow the Board to continue what they are charged to do - exercise management and control.  But I cannot overemphasize that our financials are available to any member in good standing to review after the Board approves the Balance Sheet and Income Statement."

Again in the December 1999 issue, President van Lieshout said:

"Our organization also became stronger, in part, because the status quo was challenged.  This resulted in making sure that our financials are available for review by members once the Board approves the financials at our monthly meeting; a clarification by our membership as to the role of the board in the exercise of management and control over the activities of our office staff; and a review of the by-laws as it relates to the nomination and approval of candidates for the Board.  While not always easy to deal with, a review of our practices and procedures such as this should be viewed as a necessity by any organization.  Too often we become complacent or lackadaisical without even being aware of it."

After all this, you might get the impression that because of the controversy, the Chamber Board changed its policy and now any member could review the financial details of Chamber spending. 

Actually, nothing has changed.

If you wanted to see exactly how much was collected by the Chamber hitting up local businesses and charities for what was described as the "Sign Fund" for the 1998 Road Construction Project, and how that money was spent, you can only see two numbers - how much was collected, how much was spent - and no details of what was bought, or where the money came from.  You can't see who paid how much, nor where the money was spent, nor learn why all the promotions to aid travelers during the construction period became prominent billboards for only a few businesses.

Who watches the finances of the Chamber?  The 2000 members of the Budget and Finance Committee are Executive Director David Olsen and President-Elect Amy Christian.  They are the only ones who in theory oversee the item-by-item details of the Chamber income and expenditure.

How do you get on the Chamber Board?

The Chamber may be largely a volunteer-run organization, but you can't run for election to the Board by simply volunteering to run.  You must be approved by the Nominating Committee in order for your name to appear on the ballot. In 1999, the Nominating Committee was Peggy Bare, Mike Bolger, Ken Leipold and Del Olsen.

In 1999, a dozen people volunteered to run for eight open seats on the Chamber Board.  The nominating committee picked eight candidates from the twelve volunteers.  Only those eight names appeared on the ballot, along with eight blank spots for write-in candidates.  Why the seemingly Soviet-style election, with the candidates picked by the presently ruling Board?

In the October 1999 Chamber newsletter "Letter from the President" column, President van Lieshout said:

"As to the Board Ballot there seems to be s [sic] misunderstanding of the role of the Nominating Committee and the adoption of a slate of candidates by the Board of Directors.  This is not a 'Soviet-style' election as it was recently mischaracterized.  As a Board we are looking to have a broad based representation - not only from an industry base but also from a geographic base.  We do not want a Board made up solely by Bankers (heaven help all of us in that event) nor dominated by butchers, bakers or candlestick makers.  Likewise we do not want a Board that is made up entirely of downtown merchants, or industrial park occupants, etc.  The Board and Executive Committee lists all those who have expressed an interest in being a Board member and passes that information on to the Nominating Committee.  The Nominating Committee then has the challenge to look at those present members up for re-election and the list of potential candidates and come up with a balanced ticket.  That ticket is then proposed to the total Board that can accept it as proposed or make changes.  Therefore the ballot lists a slate of candidates that we, as a Board, recommend for approval." 

Got that?  It's not Soviet-style - it's a slate approved by the Central Committee, I mean, the Nominating Committee and then the Board of Directors.

An even geographic distribution of candidates?  So the concerns of downtown versus north versus south Jefferson are in balance?  Huh?  This town isn't big enough to worry about that.  If you think your end of town isn't well-represented on the Chamber, then please volunteer to run for the Board.

Once, a Board member justified this hand-picking to me as a way to avoid Board composed entirely of Realtors, for example.  In this election, the number of Realtors actually increased from two to three.  I don't see the point.  If the Board was dominated by Realtors, and if the Chamber membership voted for them and no one else was running, who cares?

In terms of actual geographic distribution, the 2000 President and President-Elect of the Chamber actually worked at businesses in Fort Atkinson.  The 2001 President works in Fort Atkinson.

More rigged elections in 2000

The same thing happened in the 2000 election.  Just as in 1999, I volunteered to run for open seats on the Chamber Board.  The Chamber went to the trouble of sending a letter to the entire membership to seek volunteers.  Many Chamber members were given the impression that if they volunteered, their names would be on the ballot.  However, my name wasn't allowed to be on the ballot, due to the decision of the Nominating Committee.  This year, the Nominating Committee didn't even meet in person, they met by telephone.  Three people volunteered, two appeared on the ballot.

A total of 55 ballots were cast.  The allowed names on the ballot received between 53 and 48 votes, including the four incumbents.  Myself and five other write-in candidates received between 4 and 1 votes each.  It's clear that to depose an incumbent, you'd need to run a negative campaign against a particular member.

Meanwhile, during the same week as the election, two other Board members resigned, meaning these seats would need to be appointed by the Board.  One seat was filled by Bill Morris, a new loan officer at F&M Bank.  It's an unwritten law at most small-town Chambers that representatives of the local banks have a seat on the Board.  No one dare put this provision in the actual by-laws, though.

During the Chamber Board meeting, several Board members remarked that they'd never met Morris, but they appointed him regardless.  I was in the running for the other seat, too.  The vote was a secret ballot.  Everyone pushed their slip of paper to Executive Director David Olsen, who tallied the results and whispered them to the President.  I wasn't elected.  At the meeting, I asked to hear the totals, without personal attribution.  I was told that the results were secret.  So many secrets!

Who runs the Chamber on a day-to-day basis?

In the past, the City Council has given $43,200 a year given to the Commerce and Industry Association or CIA.  (This may be changing in 2001.)  The CIA hires, fires and administers an Executive Director, who serves to oversee the day-to-day operations of the Chamber of Commerce.  That's right, the City of Jefferson is paying the salary and benefits of the day-to-day director of a private organization.  The Executive Director writes his paycheck to himself, as treasurer of the CIA. 

The Executive Director also oversees the day-to-day operations of the Jefferson Development Corporation or JDC.  The JDC has ordinance enforcement powers over the tenants of Jefferson's North and South Industrial Parks.  In September 1999, the District Attorney determined the JDC was a "quasi-governmental entity," meaning it was subject to the same sort of State laws as the City.

However, the CIA does not define the proportion of the Executive Director's role.  The CIA does not define much at all about the Executive Director's position, in fact.  For many years, the CIA did not define how many days of vacation came with the position, nor how many personal days.  It still doesn't even require the Executive Director to keep track of how many hours he works.  Executive Director David Olsen continues to operate a funeral home business on the side, appearing at wakes and funerals during business hours.  He also receives three paid weeks of vacation a year, as if he were a City employee with thirteen years of seniority.

In this respect, the CIA is a very poor employer.  In fact, it's even violating the Wisconsin Statutes, which as part of the regulations of the Department of Workforce Development, require every employer to keep accurate time records for their employees, showing the start and end times of each work period.

In another respect, the CIA is a very poor administrator.  Officially, the CIA meets only four times a year.  In some years since its formation in 1995, it's met only three times.  In 1999, it met more frequently than any previous year due to the investigations of the District Attorney.

Until 2001, Jefferson's Water and Electric Commission also provided some control over CIA funds. Before that, Water and Electric provided 1/3rd of the CIA's funding.

However, due to the lack of accomplishments and accountability of the CIA, Water and Electric removed CIA funding from its 2001 budget, diverting the funds to a "community development fund" instead.  The CIA is not completely funded for 2001.

How does the Chamber membership speak?

Chamber members are represented by the Chamber Board members.  Once a year, the Chamber membership elects a portion of the Board.  The Chamber members aren't very actively involved in this election.  In the fall of 1999, after sending out almost 200 ballots, only 55 voted in the 1999 Chamber election.  The same thing happened in 2000.  Similarly, when Chamber members are surveyed about their opinion on a matter such as the Senior Center, only approximately 60 members bothered to respond.

And if you ask too many questions...  Banned from the ranch!

On November 14, 2000, the Chamber Board voted to instruct the Chamber staff to ignore any requests or communications that I made.  The motion was made by Del Chmielewski, seconded by Bill Morris.

Officially, I can no longer communicate with the Chamber.  I was never notified of this decision.  Instead I received a solicitation for my 2001 Chamber dues.  Apparently my money is still good, even if I'd be demoted to a second-class member.

Who's watching?

Even though the taxpayers of Jefferson are paying the salary of the Chamber's day-to-day director, there is no way a citizen can participate in a Chamber meeting without a specific invitation from a Chamber member and the approval of the Chamber Board.  Meetings are closed to the public.

Officially, the public oversight of the Executive Director flows through the Mayor and Council member on the CIA Board.  However, the CIA typically has only two to four hour-long meetings a year, so not much oversight is possible.

Why is the Chamber engaged in political controversies?

In the past few years, contrary to its by-laws, the Chamber office has been used to promote a particular position of political issues in Jefferson, such as the renovation of the Middle School, the Senior Center proposal, and the Milwaukee Street Walk Bridge, among others.

  • Executive Director Olsen meddled in the Middle School controversy a few years ago.  A mysteriously unsigned letter to the editor in the Daily Union encouraged people to send their Middle School opinions to the Chamber office.  Why was the Chamber involved in this?

  • Executive Director Olsen attempted to overturn City Council votes.  For example, here's a February 1999 e-mail that the Executive Director wrote to an expert on Robert's Rules of Order, to try to find a way to circumvent the City Council's first vote on the Milwaukee Street Walk Bridge.  He claims to have consulted two attorneys to find a way to invalidate the vote.  Olsen's original message was quoted on a web page for a mailing list maintained by this expert... until Olsen asked him to remove it.
    In this February 17, 2000 e-mail to the Chamber, I ask Olsen to confirm that he wrote this e-mail.  I also asked James van Lieshout, the Chamber president at the time, to confirm if the Chamber Board directed Olsen to meddle in City affairs in this way.  (I had to send the message twice before I received a response.)  In Olsen's March 28, 2000 response, he refers to this as an "alleged" e-mail, and refuses to respond.

  • On March 21 2000, Executive Director Olsen called a special meeting of the CIA Board to address the Highway 26 bypass issue.  For more than 30 minutes, Olsen begged the Board to direct him to be allowed to speak out in favor of the Highway 26 bypass.  He claimed that citizens were organizing to oppose the bypass and that even the Chamber might take a position that a bypass was unnecessary, but that if the CIA Board directed him to lobby in favor of a bypass, he could deflect criticism to their shoulders.
    In this way, those members of the Chamber, JDC and City Hall who want a bypass have hired a lobbyist in the form of the Executive Director, using essentially taxpayer dollars.  The City couldn't do that on its own.  It needs a way to launder the money and responsibility and it finds it in the CIA.  Any citizen opposed to the bypass or Olsen's preference for a bypass route now has a full-time paid adversary.

Shouldn't the public resent this?

You'd think so.  If the Chamber is leveraging public funds to lobby for particular causes, it's doing a grave disservice to the public discourse.  It's making the playing field quite bumpy.  Any citizen on the opposite side of an issue from the Chamber is up against the energies of a full-time, day-time Executive Director.  How can a hard-working citizen compete against that?

The Chamber should stick to its by-laws and remain "non-sectional, non-partisan, non-political and non-sectarian."  It should not seek to divide the community.  It should serve to help local business members.  It should have a great respect for the public funds and direct subsidy that it receives from Jefferson's taxpayers.  It should also find a way to become more self-supporting and independent of public funding.

What can be done?

Tell your City Council representative to stop funding the Executive Director position.  Ask them to reconsider the ways the City funds the Chamber, CIA and JDC.  Ask them to reorganize the City's economic development efforts and untangle them from private groups like the Chamber of Commerce.

Ask them to attach more strings to all funding of private groups, such as requiring an advance budget for spending, and a post-game analysis of the money that was spent, and more detailed demonstrations of need.

Ask them to find ways to make the Chamber more self-supporting.  For example, Fort Atkinson's Chamber of Commerce is self-supporting and quite active in helping local businesses.

If you're a Chamber member, ask the Chamber Board to increase membership dues or focus on non-tax-based fund-raising activities so the Chamber can become more self-supporting, instead of depending on the public dole.  If you don't like what the Chamber is doing, tell your Board members your opinion.

-