Close Southeast Raleigh’s business incubator

August 12, 2013 

It may have seemed like a good idea at the time, in 2000, when a Southeast Raleigh business incubator was formed to help development in an area of the Capital City that needs more small business activity. But records show an organization in disarray, with haphazard bookkeeping (that’s putting it mildly) and $65,000 gone missing, according to a city audit.

Lawrence Wray, a former Raleigh assistant city manager who is the group’s current chairman, astonishingly defends the organization and says it deserves another chance. That is preposterous. (Some of Wray’s family members have been paid for services provided to the incubator.)

The grandly named Raleigh Business and Technology Center, which has received more than $3 million in support from the city of Raleigh, local universities, Wake County and the federal government, needs to be shut down, and right now. Enough is enough.

Lack of oversight

And in addition to the Raleigh police investigation now in progress, the State Bureau of Investigation should join the effort. And Raleigh City Council members ought to be embarrassed for their lack of oversight here, given the public dollars involved. They should not again enter into such arrangements. Any efforts such as this should report to the city manager, period.

The News & Observer’s Colin Campbell has reported that Bob Robinson, the incubator’s director, founded a separate organization called the National Youth Chamber of Commerce and gave it at least $290,000 from the incubator’s budget. And the incubator’s first director, retired UNC system official E. Walton Jones, continued to receive annual payments from $66,000 to $74,000 even after he stepped down. Wray, who approved the payments, says the center didn’t pay Jones enough for his services when he was there.

Robinson also was withdrawing up to $9,000 cash from the incubator’s accounts with few specifics about where the money was going. When city auditors asked for more info, they didn’t get it. Robinson resigned after auditors discovered he’s drawn $65,000 in teller checks from the incubator.

Tens of thousands of dollars have been moving around courtesy of Robinson and the incubator, but there seems to be little to show for the moving and spending. The organization has been ordered out of its city-owned building, but a judge has said the group can stay until everything is settled.

And meanwhile, Wray, who as a former assistant city manager ought to be more concerned about what has happened to public funds, stays in a defensive mode.

Time for accounting

Partnering with private individuals who may have ideas about how to create jobs isn’t inherently a bad idea. But in this case, it appears the partnership was created, the checks written and the money spent without much oversight. That is inexcusable and something for which the members of the Raleigh City Council should be held accountable.

It’s an expensive lesson, but let’s hope one is learned. First, organizations using public money have to report directly to the city manager who must then be responsible. If auditors, who need to be involved all through the allocation and spending process, have any trouble getting every bit of information they need to put a detailed accounting together, money should be cut off from any organization immediately. Spending should be tracked frequently.

Connections among relatives or friends of those involved with supervising an incubator or any other kind of business connected to public service and public money should be monitored and kept to a bare minimum, if they’re tolerated at all.

In this case, it’s too late for corrective action, and the business incubator must be closed, period. Either the idea wasn’t property developed, or the people who were running the operation didn’t know how to do it. But with the closing also must come a thorough and uncompromising investigation, no matter where it may lead.

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