The chairman of the board of the Knoxville Tourism and Sports Corporation resigned this week amidst questions about the organization's spending.
10News was the first to report questions about spending by the group, particularly the amount of the budget that's devoted to on salaries. In 2010, KTSC President and CEO, Gloria Ray, made $405,583, accounting for nearly 18 percent of KTSC's salary expenses.
Additional documents delivered to 10News Wednesday showed incentive bonuses, signing bonuses, and retention incentive agreements with Ray that total into the hundreds of thousands of dollars.
Gloria Ray's original contract, signed July 2007 (PDF)
Addendum to Gloria Ray's contract, signed October 2008 (PDF)
In a retention incentive agreement signed by Duncan and Ray dated October 13, 2008, Ray was entitled a commitment bonus of $50,000 that she must repay if she chose to not complete her duties through June 30, 2013.
According to that agreement, Ray is due a retention bonus of $86,649 if she completes her duties through June 30, 2012. She is due an additional $166,633 if she stays on as President/CEO through June 30, 2013.
An addendum to Ray's contract, also signed by Ray and Duncan in October 2008, shows that Ray will receive 10 weeks vacation for the fiscal years 2011-2012 and 2012-2013.
Ray would be treated as a part time employee and receive a consulting fee of $150,000 in the 2013-2014 fiscal year. In that year, KTSC would also pay FICA tax for Ray and provide her with worker's compensation insurance.
In the last year of her contract, if she gets all the bonuses including the contract completion bonus, Ray could theoretically make $608,216.
In another document dated July 25, 2007, Ray was entitled to $46,350 for successfully negotiating with Knox County government to capture previous hotel/motel taxes that were collected and not paid to KTSC over the four prior years. That reconcilliation payment agreement said Ray was to receive a one-time payment equal to 15% of the $309,000 payment of taxpayer money KTSC received from the county in the 2005-2006 fiscal year.
Prior to the release of the additional documents Wednesday, several Knox County and Knoxville leaders have added their questions about Ray's compensation.
In a press release Wednesday from Moxley Carmichael, a local public relations firm hired by KTSC this week, it was announced the David Duncan was resigning.
"I have been very concerned over the past few weeks about how we can be responsive to the concerns that have been raised and to restore the reputation of KTSC as an organization and confidence in its leadership," Duncan said in a letter of resignation. "I believe that KTSC would be better served by different leadership of the board."
Susan Brown, the vice chair of the board, is now the interim chair, in accordance with the organization's by-laws.
"The KTSC has received dozens of requests for information and documents regarding this issue over the past few weeks and we have been trying to respond to those requests with sensitivity to both the legalities and certain privacy issues," Brown said. "Upon the advice of legal counsel, we have determined that all the documents are, in fact, public records. Rather than release the documents in a piecemeal fashion, we have decided it is more efficient to release them all at one time to anyone who has asked for them."
Those documents are supposed to be delivered to the local media by 8 pm Wednesday. 10News has already requested and received a number of documents from KTSC, which are posted here. We are unsure what documents will be released this evening.
Brown said the KTSC Board of Directors will meet on Friday at 1:30 at the KTSC offices to discuss this and related matters.
"KTSC is committed to getting this very distracting issue behind us in order to clear the air and move forward to do our job of recruiting visitors and meetings to our community," Brown said. "We also look forward to meeting with our partners at the City of Knoxville and Knox County to answer any questions they have and tell them our plans to keep our community in the forefront of meeting planners and decision makers across the nation."