When they scolded the U.S. Justice Department last week for its spending on meetings and events, members of Congress were "most likely inaccurate and definitely shortsighted," according to Karen Kotowski, CEO of the Convention Industry Council (CIC), a consortium of 31 meetings industry organizations, including Meeting Professionals International (MPI), the Professional Convention Management Association (PCMA), and the International Association of Exhibitions and Events (IAEE), among others.
In a statement released yesterday, Kotowski responded to a government audit that was made public earlier this month. According to a 148-page report, auditors found "extravagant and potentially wasteful" expenses at Justice Department conferences, including $4,200 paid for 250 muffins — approximately $16 per muffin, including service and gratuity — at a 2009 meeting hosted by the Office on Violence Against Women at the Capital Hilton in Washington, D.C.
The report, which found that the Justice Department spent $121 million on 1,832 conferences between 2007 and 2009, resulted in a barrage of anti-meetings sentiment on the floors of the House and Senate last week.
"Do you know the muffin man, the muffin man?" Rep. Ted Poe (R-Texas) asked on the House floor last Thursday. "I know the muffin man, and the government should quit spending somebody else's money to keep the muffin man rolling in the dough."
Added Sen. Chuck Grassley (R-Iowa) in a written statement, "The report released by the inspector general detailed lavish expenditures by the Justice Department on conferences ... It is the line item expenditures that show just how ridiculous this spending really was. For example, the inspector general found the department paid for $16 muffins, $10 cookies, $5 cans of soda, $8 cups of coffee, and over $32 per person for Cracker Jacks and popcorn snacks. This was on top of nearly $600,000 that was spent to hire outside event planners for these conferences. The expenditures this audit has found are simply amazing. They are an example of why so many Americans have lost faith in the federal government ... As Americans face over 9 percent unemployment and the federal deficit sits at well over $14 trillion, the Justice Department continues to live the high life."
While Attorney General Eric Holder hasn't released an official response, Hilton Hotels has refuted auditors' assertion that conference spending was over the top.
"Hilton has a long-standing practice of working with government agencies to plan meetings and events that fall within their budget," a spokesperson said in a statement. "Usually provided by the agencies themselves, these budgets are reflective of the pricing structure of the destination, local taxes, gratuities and other fees ... Dining receipts are often abbreviated and do not reflect the full pre-contracted menu and service provided, as is the case with recent media reports of breakfast items approved for some government meetings."
In her response to the "muffin meeting" controversy, Kotowski specifically called out Senate Majority Leader Harry Reid (D-Nev.), who joined in last week's criticism of Justice Department meetings. The prices paid by the Justice Department compare "very favorably to the prices paid by the United States Senate, over which Sen. Reid himself presides," she pointed out.
According to Kotowski, a review of the catering menus posted online at the United States Senate Dining Services website shows breakfast costs ranging from $12 up to $20 per person before tax and gratuity, lunch ranging from $15.50 for deli meats up to $42 for a three-course hot plated lunch, and dinners from $49 to 69 per person, with most selections above the current GSA per diem rates for Washington, D.C., of $12/$18/$36 for breakfast, lunch and dinner, respectively.
"The now-infamous 'muffin' meeting, organized by the Office on Violence Against Women, came to light as a result of a report by a Justice Department auditor," Kotowski said. "That report had a lot of good things to say about the meeting that the press and Sen. Reid have ignored. For example, in examining the meeting's total expenses, the inspector general gave credit to the agency for saving money by not serving full meals at the five-day conference. The planner ordered far less (250-300 orders) than the actual attendance of 534 people, resulting in a $14.74 per person per day cost for beverages and light snacks. The report points out that this was a shocking two cents over the agency-established limit of $14.72! In my book, the meeting planner did an excellent job in controlling costs."
Kotowski also noted the common practice in the meetings industry of hotels waiving meeting room rental with a minimum food and beverage purchase. "The report also goes on to say that there was no cost savings because the actual amount spent was $47,000 more than the minimum required food and beverage for free space," she said. "Most professional meetings planners would know of this practice and applaud the planner for an excellent job in negotiating the minimum far below what the actual spend would be, ensuring that meeting room rental would never come into play."
"Audits are necessary and I applaud the effort to reign in government spending and to make recommendations for effective cost control procedures. Surely there is room for improvement in controlling the cost of food and beverage items and in the process of bidding, contracting and reporting of outside meeting planning services. What the objective eye of an accountant could not capture merely by looking at banquet checks from hotel bills were other factors, such as whether it was more cost effective to bring people together in one location than other methods of training and whether the outcomes of those live sessions are more effective.
The goals of the Convention Industry Council include promoting best practices in the planning and delivery of meetings and elevating the professional practices of the meeting planning profession. A study by CIC on the value of face-to-face meetings found that face-to-face meetings build trust and relationships; education and training are more effective in a live setting; live meetings actually save time and money; live meetings result in a more effective exchange of ideas.
Before waving a $16 muffin at a camera, Sen. Reid should look at the broader picture. Sometimes a muffin is just a muffin, and once again he's bashing an industry that provides thousands of jobs and millions of dollars in tax revenues to his own state."
To read Kotowski's commentary in its entirety, visit www.conventionindustry.org. For more on this topic, see Proposed Rules Would Restrict Attendance of Government Employees at Trade Shows.