It was a lavish evening at the posh Center Club, a Gatsby-themed affair 10 months in the making.
The private, South Coast Metro venue was replete with flappers, generous silent-auction gift baskets, live music, a faux casino and hors d'oeuvres. Nearly 200 people attended the party last October, hoping it would be a much-needed fundraising boost for the Costa Mesa Senior Center.
The party, the center's first fundraiser in eight years, cost nearly $45,000 and raised some $43,000 — a net loss of about $2,000.
The festivities occurred five months after the Costa Mesa City Council approved a $26,500 audit that, as it would turn out, didn't paint a rosy picture of the senior center's operational structure and financial stability.
The document, prepared by Costa Mesa-based Management Partners and obtained by the Daily Pilot before its posting Tuesday on the city's website, predicts a "fiscal crisis" for the West 19th Street facility.
By June, the end of its 2013-14 fiscal year, the center will have depleted its general fund, according to the report.
"A serious fiscal issue exists with [the senior center's] operating budget and the ability to provide services after this fiscal year, which needs to be addressed by the [center's] board immediately," the report states.
The board has indicated a desire to use funds from a separate memorial foundation toward the deficit, according the audit, which questioned the legality of such a proposal.
Since 1987, the center has operated as an independent nonprofit with a board of directors, according to the report, though it still receives considerable aid from the city, including about $535,570 worth of in-kind services for the current fiscal year, in addition to $240,000 in annual funding. The facility serves 300 to 400 seniors daily.
The November report issued 15 recommendations, among them that the city amend its agreement with the senior center. The audit describes the agreement, which expires in June 2015, as "primarily a lease/tenant agreement" that provides little oversight.
According to the report, "The structure of the current agreement does not give the city the ability to hold [the senior center] accountable to any standards, nor does it have the authority to regulate their senior services and program operations."
The audit highlights declining figures between fiscal 2008-09 and 2011-12, namely a 20% drop in program participants and 35% drop in volunteer hours.
That same period, however, saw a 65% boost in "social club participation" stemming from increased attendance at Alcoholics Anonymous meetings.
Membership revenue also went down within the past several years. In fiscal 2008-09, the center earned nearly $23,400 in membership revenue, but by 2011-12, that figure was near $16,000.
A 26% boost in 2012-13 helped bring the total to about $20,000, according to the audit, because the nearby Bethel Towers senior housing complex generated 210 memberships.
The audit also recommends that the senior center receive accreditation from the National Council on Aging, that the city conduct a community survey to assess senior citizens' needs, and that the center's executive director and staff receive annual evaluations.
Board members should also learn about the California open-meetings law, known as the Brown Act, and receive training in "governance and fiduciary duties," it said.
"The City Council and community expect the highest quality services for our seniors," city CEO Tom Hatch said in a statement the city released Tuesday afternoon. "This report reflects serious operational and financial challenges that need to be immediately addressed. Together, we need to learn from this report and do what it takes to provide the community with a financially stable and vibrant center for our seniors."
The senior center's executive director for the past 13 years, Aviva Goelman, acknowledged that the 20,000-square-foot facility is running on a deficit. She said she met with Hatch on Tuesday and took a look at the audit but had not yet closely read it.
She cited the effort to use some of the Albert Dixon Memorial Foundation's $600,000 to fix the deficit. The nonprofit foundation exists "to keep the programs going. That's what [Dixon] would have wanted. The money is not just available for frivolous things."
She said the center provides many of its programs at no cost, but gaining members is difficult because baby boomers generally are not seeking its services.
"They do not want to be a member in one place," she said. "They'll pay for a specific program, but they don't want to be members everywhere."
Goelman said the recommendations are "really going to change things. It's going to be many hours spent to fulfill them, but this is how the city wants to work. I don't think we have much of a choice."
Judy Lindsay, who's in her second year as president of the center's executive committee, said the facility needs to look closely at the study and work with the city.
The goal remains "to provide the best senior center in town for our seniors," she added. "We'd love to have them come and join us."
For others on the senior center board, the audit's portrayal of a "fiscal crisis" came as no surprise.
Board member David Stiller, who had not read or received the audit yet, said the financial problems were "not news as far as the board of directors is concerned."
"The plan was to seek discussion with city CEO Tom Hatch about seeing if we can get some fiscal help from the city," Stiller said.
Feeney said she gave 60 days' notice, with her last day to be Feb. 4. Eric's resignation date was not immediately available.
In an interview with the Pilot, Feeney described a dysfunctional structure and difficult communication between the board and the center's executive committee.
Like Stiller, Feeney had not seen the audit, but said of the financial situation, "We have more expenses than we have income. It just boils right down to that."
She said the senior center payroll, about $440,000 for five full- and about eight part-timers, amounts to nearly half of the roughly $850,000 budget.
"That's a pretty big payroll," Feeney said.