Sports Kids Lacks Cash for Games : Irvine Group Says Donor’s Reluctance Threatens Meet
Officials of an Irvine-based organization founded by former Olympian Bob Mathias may have to cancel an international youth competition scheduled for Mexico this summer because--as corporate financial records indicated Thursday--they have no cash to produce it.
Chuck Foster, executive director of Sports Kids, blamed the shortfall on the failure of Texas businessman Michael A.S. Makris to make good on a promise to donate at least $5 million to the organization.
When Foster allowed a reporter to examine the organization’s financial records on Thursday, documents showed that:
* The Sports Kids checking account appeared to be overdrawn by $5.
* The organization’s April 30 financial statement, prepared by the Irvine accounting office of Ernst & Whinney, listed liabilities of $550,000.
* Nearly $400,000 of those liabilities were salaries that have not been paid. Foster said that Sports Kids executives have not drawn a salary and have received minimal reimbursements for expenses since the organization was formed 18 months ago.
* While the organization has $98,000 in assets, according to the financial statement, it owes more than $100,000 in payroll taxes and worker compensation payments to the state.
* A World Children’s Concert that Sports Kids staged on April 16, featuring entertainers Donny Osmond and Mike Love of the Beach Boys, raised $137,990--but after expenses produced only $26,403. A $50,000 donation from The Sporting Club at Irvine also was used to cover concert costs.
The Times reported last month that Sports Kids owed about $80,000 to former Irvine City Councilman C. David Baker. After Baker was convicted of forging a check to finance his faltering congressional campaign last year, he performed community service work for the organization and ultimately accepted a full-time job, although he resigned in April.
Earth Games Threatened
Foster and Sports Kids official Larry Sayler said that unless the group receives some other financial commitment by Monday, they will cancel the Earth Games, which are set to begin Aug. 13 in Tijuana and feature competition between children from 40 countries. The group sponsored a similar event last year in Irvine that drew participants from Mexico and the Soviet Union, as well as the United States.
While Foster and Sayler said they have lined up more than $1 million worth of non-monetary contributions--including the free use of some facilities, some volunteer workers and discounts on other items needed to stage the event--they still need from $350,000 to $485,000 in cash.
In an interview this week, Makris confirmed that he agreed to donate $5 million and has not done so. But the Houston businessman said he is prepared to make the contribution upon the resignation of Foster, who Makris accused of being a poor administrator.
Foster said he does not believe that Makris really has the money.
Sports Kids officials say they were introduced to Makris, 62, in January through a charity broker who described him as a multimillionaire who wanted to donate a large sum of money to a nonprofit organization devoted to the development of children.
Foster said the businessman eventually agreed to give Sports Kids $5 million a year for five years. (Makris said he agreed only to the $5 million.)
When Makris failed to make the first installment of his contribution in May, Foster said he learned that the businessman had a criminal record.
Makris acknowledged that record when interviewed this week and also in a recent letter to staff members at Sports Kids:
“Somehow,” Makris wrote, “doing business with large amounts of money and dealing in highly sophisticated financing programs, one cannot help but make technical mistakes that violate rules and U.S. regulations, no matter how many lawyers are in tow. Of course, the penalties are high; fines and penitentiary terms are common. . . .
“I served time twice,” Makris continued in the letter. “The first time because I exchanged the treasury shares of a bankrupt company that I bought for a bargain price. . . . The second was the result of a perjury charge that emanated from a highly political Watergate-type event.”
Makris described his convictions this week as “politically motivated.”