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ATCS also found that on many of the days that course revenues seemed abnormally low, tournaments and other special functions were scheduled. When Cruzada asked Lottes for additional information on those events, which usually generate substantial golf sales, she was told he didn't keep records for that type of activity. Using monthly sales reports, ATCS conducted a study of "inconsistent day sales" at the course and estimated a shortfall in reported income of $539,186 -- $215,676 of which would have gone into Hollywood's coffers.
Indeed Lottes' numbers seem to show the course is badly underutilized, according to ATCS. Although Lottes told the auditors he keeps no records of the number of golfers at Hollywood Beach, ATCS estimated 41,785 rounds are played there annually. For the sake of comparison, Cruzada selected two similar courses, in Pompano Beach and Ocala. Analysis disclosed those courses average more than 70,000 rounds per year.
Moreover ATCS recommended the city further examine Golf Hollywood's financial records. But if the past is any indication, city administrators will be less than aggressive. When New Times reported ("A Bunker Mentality," October 7, 1999) that Lottes was improperly pocketing the parking revenues, the State Attorney's Office asked officials whether they wanted to press charges. The city declined the offer.
At least one Hollywood commissioner is calling for further investigation. Commissioner Sal Oliveri, who was informed of the ATCS review by New Times, requested an outside audit of Golf Hollywood. "I think this has to be resolved once and for all because Mr. Lottes' business dealings have been questioned for a long time," Oliveri comments. "An audit should certainly bring out whether there is money missing."
Finz says neither an audit nor a criminal investigation is necessary. "There have been a lot of liberties taken [by Golf Hollywood] in the way things have been accounted for," Finz says. "There is going to be corrective action taken. But I see no indication that anything [criminal] has occurred."
Instead of probing whether $540,000 went unreported or not, finance director Garcia states the city is taking "drastic action" to ensure Lottes' mistakes are not repeated. Among the new requirements is a provision to force Lottes to submit detailed records of receipts from tournaments and the like to the city.
Howard Sher, a Hollywood political activist who has dogged Lottes and his company for the past two years, says the city's protective attitude toward Golf Hollywood is to be expected. After all, Lottes and Koslow are close to the city commission and Finz. "I have no relationship with Golf Hollywood whatsoever," responds Finz, adding that he believes Lottes is doing a good job managing the golf courses. "Why would I protect [Lottes and Koslow]?"
But Sher is determined to get to the bottom of Golf Hollywood's finances and is pressing for a criminal investigation. "This report should bring outrage," Sher says. "Instead the city is going to try and cover it up, guaranteed. This is a whitewash."