State budget impasse could have devastating effect on Amistad

Mystic — If the General Assembly fails to pass a budget that does not significantly increase funding for nonprofits, the impact on the new organization that owns and operates the schooner Amistad could be devastating.

On July 1, Gov. Dannel P. Malloy issued an executive order that included a long list of budget cuts in the absence of an approved 2017-18 state budget. Among them was $291,140 for the Discovering Amistad and $476,719 for Mystic Aquarium. The General Assembly has not yet set a date to reconvene and try to pass a budget.

The cut to Discovering Amistad comes at a critical time for the fledgling organization as it works to get the schooner back on solid footing and repair its reputation following the financial problems of Amistad America, its former owner.

While the organization has raised about $100,000 in private funding over the past year, its chairman, Len Miller of Essex, said the state funding is needed over the next few years until it can become self-sufficient through grants, private donations and revenue from its educational programs.

“We have to have the money to continue. If not, we’ll have to seriously consider phasing out our organization. That, however, would be the last resort,” he said. “If we did have to shut down, we would not owe one person one penny.”

When Amistad America shut down, and the state seized the ship, it owed more than $2 million to a large group of organizations, banks, individuals and small businesses. Those creditors were never paid.

Miller said his group continues to seek private donations and grants, which has been part of his group’s long-term strategy to become self-sufficient. Board members also are talking to legislators.

“No one on our board wants to always be this dependent on the state of Connecticut or any one funding source. We want to diversify our funding,” he said.

Miller said he understands that the state has less money and that nonprofit groups may not get what they have in the past. But he said he hopes the ship will get some amount of state aid, which, in conjunction with private funding and program revenue, will help keep it going.

“The premise is we would receive state funding until we don’t need it,” he said, adding it would take a few years to improve the feelings about the schooner.

The ship was scheduled to arrive Friday in New London after the first of two two-week cruises with high school students who will be the first generation of their families to attend college. In addition to learning how to sail and participating in Amistad educational activities, they are visiting colleges such as Yale University, the State University of New York at Stony Brook and the Coast Guard Academy. The next cruise, which will include New London students, will begin Aug. 6 in New London.

“I’ve talked to a lot of nonprofits and a lot of them are worried,” Miller said about the possible cuts in state aid. “Hopefully this will have a happy ending.”

“What we’re all hoping is that the permanent budget will restore what was left off,” he added.

Officials over at Mystic Aquarium remain hopeful that the state will continue to support the organization's marketing and tourism efforts.

Dale Wolbrink, an aquarium spokesman, issued the following statement: “Mystic Aquarium has received a tourism grant from the State of Connecticut for over a decade. We support the State’s continued investment in tourism development and are hopeful that Mystic Aquarium will continue to receive funding that helps supports community marketing programs and promotional reach into outer advertising markets."

"If the State’s current financial situation limits these critical investments, Mystic Aquarium will continue to work with the State Department of Economic and Community Development, the Governor’s Office and the Legislature to show how important tourism investments like these are to long-term economic growth for the State of Connecticut," he said in the statement. "We are confident that the State of Connecticut will continue to make these strategic investments in tourism development going forward.”

Amistad America, formed in 1998, lost its nonprofit status in 2012 for failing to file three years of tax returns. Nevertheless, the state continued to make annual $360,000 payments to the organization, which fell deeper and deeper into debt, until finally freezing funding for the 2014-15 fiscal year as controversy over the organization’s lack of fiscal accountability intensified. The organization had provided little documentation about how it was spending state funding.

Following stories by The Day about how Amistad America had spent the $9 million in state funding, and calls for an investigation by State Rep. Diana Urban, D-North Stonington, the state conducted an audit, seized the ship in the summer of 2014 and sold it to Discovering Amistad for $315,000. The state then provided $957,000 to Discovering Amistad so it could purchase and repair the ship.

j.wojtas@theday.com

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