Senate Restaurants Slide Further Into Red
More Than Half of Chamber’s Members Fail to Pay Tabs on Time
After a successful three-year-long effort to reduce sales losses and decrease taxpayer support, the Senate Restaurants appear to be sinking back into debt, according to a new General Accounting Office report.
The biennial audit, issued Tuesday by GAO, reveals the Senate Restaurants experienced more than $678,000 in sales losses in fiscal 2003. While that amount is significantly less than the nearly $1.2 million loss posted in fiscal 2002, it is still nearly double the losses of $351,000 and $388,000 reported in fiscal 2001 and 2000, respectively. After posting a deficit of $1.3 million in fiscal 1998, the Senate Restaurants sought to slow its losses.
Only the restaurants’ catering services and vending machines posted positive earnings in both funding cycles covered by the audit. Those sections claimed profits of $369,000 and $326,000, respectively, in fiscal 2003.
“If losses from operations continue, the Fund will continue to require financial support to maintain operations,” states the audit, conducted by Clifton Gunderson LLP. The audit notes that the restaurants received $1.1 million in appropriated funds in fiscal 2003 and $1.2 million the previous year.
The restaurants’ financial statements do not list certain costs, such as space or utilities, “which are not readily identifiable.” Similarly, the statements do not include information on costs such as capital expenditures or maintenance fees, which are paid for by the Architect of the Capitol.
The audit also shows that those customers allowed to run a tab — Senators, former Senators and certain officials — often fail to pay the bill on time.
In fiscal 2003, the restaurants billed $189,545 to the “customer accounts,” of which more than $88,000, about 47 percent, was paid back within a 30-day period. Nearly $27,000 in charges remained outstanding after 60 days and an additional $65,000 remained outstanding after 90 days.
In the previous year, the Senate allowed customers to charge $302,116 at its facilities, of which nearly $169,000 was repaid within a one-month period. More than $31,000 had not been paid back after 60 days and an additional $98,530 was still outstanding after 90 days.
In previous years, Senate officials have told Roll Call that the delinquent accounts are actually a source of revenue for the restaurants, because penalties are assessed on the initial charges.
Senate Restaurants Director Michael Marinaccio had not seen the report, but said the fiscal 2002 spike is related to the anthrax attacks, which shutdown the Senate’s office buildings.
Notably, the Hart Senate Office Building’s sundry shop posted a loss of $25,783 in fiscal 2002, but came very close to breaking even in fiscal 2003, with a loss of $660.
A spokeswoman for the Senate Rules and Administration Committee, which oversees the restaurants, did not return a telephone call seeking comment.