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SF Pays Large Bucks to Nonprofits, Fails to Correctly Monitor Them

SF Pays Large Bucks to Nonprofits, Fails to Correctly Monitor Them

2023-04-28 09:44:20

San Francisco nonprofits obtain more than a billion dollars in taxpayer cash yearly, however the degree of scrutiny they face varies vastly by division—and, in some instances, oversight of operations has been left to the honour system for the reason that pandemic began.

Metropolis data present that two nonprofits—Baker Locations and the United Council of Human Providers (UCHS)—acquired principally glowing marks from metropolis companies final yr, not lengthy earlier than they have been accused of mismanaging public funds. Metropolis officers are within the technique of pulling a few of Baker Locations’ contracts and flagged UCHS for felony investigations.

The Commonplace obtained efficiency monitoring stories for a number of metropolis departments after an investigation discovered that almost 140 nonprofits contracting with town have been legally barred from receiving or spending funds after having their charitable standing revoked by the state Lawyer Normal’s Workplace.

A evaluate of stories discovered low efficiency in some instances and inconsistencies in documentation, significantly throughout the Division of Homelessness and Supportive Housing, which had greater than $87 million in contracts with nonprofits that have been out of compliance with the state as of final yr. Whereas a few of the company’s nonprofits acquired intense scrutiny and suggestions on how they may enhance, others have been primarily rubber-stamped and stories supplied few feedback past saying information have been “in order, organized and easy to follow.”

As San Francisco has turn out to be more and more reliant on the work of nonprofits, which could be extra nimble and cost-effective than metropolis departments, the efficiency stories have raised considerations about whether or not public companies are sufficiently managing the organizations tasked with confronting town’s largest crises.

Wake-Up Name 

Supervisor Catherine Stefani, who oversaw a Authorities Audit and Oversight Committee listening to final month wanting into how properly metropolis nonprofits are performing, mentioned the discrepancies in reporting by metropolis departments ought to function a wake-up name.

“That is precisely why San Franciscans are skeptical about how we’re spending taxpayer {dollars},” Stefani mentioned in a press release. “Final yr, we spent $1.4 billion on metropolis contracts. And but, the checks which might be supposed to forestall and determine mismanagement failed.”

San Francisco Supervisor Catherine Stefani takes notes throughout a Board of Supervisors assembly at Metropolis Corridor on Could 3, 2022. | Camille Cohen

Sherilyn Adams, govt director for the nonprofit Larkin Avenue Youth Providers, mentioned within the February oversight hearing that working with town could be burdensome.

“Contracting with town is sophisticated and difficult,” Adams mentioned. “After we are speaking about streamlining the method, what we’re speaking about is [that] on this system monitoring facet or doing enterprise with particular person departments, there’s little or no consistency.”

In August 2022, the City Controller’s office released an audit that discovered metropolis departments operated in silos when monitoring nonprofits, creating redundancies and permitting organizations to flee discover when falling in need of their aims.

Debbi Lerman, govt director of SF Human Providers Community, a lobbyist group for roughly 80 nonprofits within the metropolis, mentioned that the necessities positioned on nonprofits could be heavy-handed. However she mentioned her group helps a streamlined monitoring program.

“We’re in communication with Supervisor Stefani, and we assist this effort,” Lerman mentioned. “What we don’t need to see is layers and layers of extra duplicative and pointless necessities positioned on nonprofits. We’re making an attempt to supply providers, not fill out papers all day.”

In a press release, Mayor London Breed’s workplace referred to as town’s partnerships with nonprofits very important for delivering providers to residents whereas additionally noting there have been challenges.

“When the Mayor discovered of points at UCHS final yr, she requested for an audit by the Controller, which then helped us implement reforms to make sure we’re utilizing our native, state, and federal funding successfully,” the mayor’s workplace mentioned. “And we anticipate our departments to do the identical when and if points come up.”

Paper Pushing

Baker Locations, which has operated residential detox and therapy applications for hundreds of individuals within the metropolis, got here beneath scrutiny final yr after it twice begged supervisors for a bailout due to insufficient funds. Nevertheless, much less consideration was given to how properly the group was finishing up its mission. 

A Google Avenue View of Baker Locations at 170 ninth St. in San Francisco.

A efficiency report performed by the Division of Public Well being in June of final yr discovered that the Valencia Hummingbird respite program—designed to assist people who find themselves homeless, mentally ailing and affected by drug habit—met simply 50% of its contracted efficiency aims. No plan of motion was advisable. A report for Odyssey House, one other rehab facility run by Baker Locations, exhibits that it was assembly simply 40% of its efficiency aims.

The efficiency of those applications was not cited as a cause by town to tug a few of Baker Locations’ contracts.

The Division of Public Well being mentioned in a press release that the company is working with Baker Locations “to keep up providers via the tip of this fiscal yr and proceed to evaluate with them the switch of providers that can reduce impacts on shoppers and employees.”

In April 2022, the Division of Homelessness and Supportive Housing gave excessive marks to UCHS, which operates a leisure automobile shelter at Pier 94, regardless of notes about pet feces being a “fixed difficulty” and 4 trailers being destroyed by fires. The report famous that some friends weren’t going via town’s coordinated entry system, which is required by legislation, however all aims within the report have been giving passing grades.

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The group’s CEO, Gwendolyn Westbrook, later advised The Commonplace that she provided housing to as many as 20 family members, friends and employees.

In November, the Metropolis Controller’s and Metropolis Lawyer’s places of work issued a report that accused UCHS of widespread mismanagement. The 2 places of work asked the FBI and SF District Attorney’s Office to launch criminal probes.

The Division of Homelessness and Supportive Housing additionally has a million-dollar contract with the Tenants and Owners Development Corporation (TODCO), however the company has not achieved an inspection of any of the nonprofit’s eight low-income condominium buildings within the South of Market space for the reason that begin of the pandemic.

A current investigation by The Commonplace reported that tenants in one in all TODCO’s single-room occupancy buildings had frequent complaints about rat and roach infestations. Moreover, 15 folks have died from drug overdoses in TODCO properties for the reason that begin of 2020.

Emily Cohen, a spokesperson for the Division of Homelessness and Supportive Housing, mentioned in a press release that the company makes use of a risk-assessment software to find out which of its nonprofits ought to obtain the eye of program screens.

“We take a look at a number of elements to find out if a contract is taken into account excessive or low threat,” Cohen mentioned.  “TODCO has not been prioritized for onsite program monitoring because it has been decided to be a low-risk grant. It’s our intention to develop program monitoring to all grants and contracts as we employees up.”

Supervisor Stefani’s workplace has been working with the Metropolis Controller on laws to deal with nonprofit efficiency monitoring, and new laws may very well be launched by the tip of subsequent month.

“We’ve to basically change how we monitor and consider the efficiency of those organizations to make sure that they successfully ship for the weak populations they’re meant to serve,” Stefani mentioned.

Josh Koehn could be reached at [email protected]

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