Urban League is on the defensive

(from Seattle PI)

Even before the civil-rights organization was caught up in the Seattle Public Schools' financial scandal, the city had reduced its financial support drastically, killing one big contract and slashing another.

Seattle Times political reporter

It's already been a rough year for the Urban League of Metropolitan Seattle.

Even before the venerable civil-rights organization was caught up in the Seattle Public Schools' financial scandal, the city had reduced its financial support drastically, killing one big contract and slashing another.

In January, the city yanked a $500,000-a-year contract for the Urban League's youth-violence prevention work and awarded it to other organizations. The city criticized the Urban League for submitting vague, inaccurate invoices — accusations similar to those raised by auditors in the schools scandal.

The city also cut long-standing financial support of the Urban League's center to help minority small-business owners to get construction contracts, deciding to seek other bidders for the first time in years.

In the midst of all this, longtime President James Kelly stepped down in January, citing health and personal concerns.

The Urban League has been largely silent since the school-district state audit made headlines last week.

Tony Benjamin, the Urban League's acting chief executive, said he's been through a "baptism by fire" and would answer questions at a news conference Wednesday morning. The group has tapped political consultant Cathy Allen for advice.

"We'll address all of that tomorrow," Benjamin said. "Hopefully, it will clear the air."

State audit

Questions about the Urban League's handling of public contracts surfaced in the state audit, which questioned $1.8 million in expenses in Seattle Public Schools' small-business contracting program.

The Urban League was the largest single recipient of that money, receiving nearly $600,000 in contracts that were labeled "questionable uses of public funds" by auditors.

One of the Urban League's big contracts from the city of Seattle was awarded in 2009 as part of then-Mayor Greg Nickels' initiative to tamp down violence after a rash of shootings in Central and South Seattle.


The no-bid contract paid the Urban League about $900,000 for its work over two years.

As part of the program, the Urban League hired outreach staff to seek out troubled youths and try to reconnect them with schools, jobs and counseling.

But this year, under Mayor Mike McGinn, the city decided to put the contract out for competitive bidding. The Urban League submitted a bid, but the work was awarded to the YMCA and Therapeutic Health Services in January, records show.


A city evaluation finished last month criticized the Urban League's performance on the contract — rating its performance "below requirements" or "deficient" in 16 of 28 categories.

The harshest grades were for sloppy invoices and budget problems — issues similar to those raised by state auditors with the Urban League's work with the school district.

The organization met the city's contract requirements in 10 categories and was rated "superior" in two — including praise for trying innovative approaches to the violence problem.

Mariko Lockhart, head of the city's Youth Violence Prevention Initiative, described the Urban League's record on the project as mixed.

"They had strong staff. I just think the oversight of it was probably not tight," said Lockhart, describing the organization's invoices and other records as "a mess" — especially after the departure of program coordinator Jamila Taylor.

Taylor, who quit the Urban League last fall, now works on the youth-violence-prevention effort with Therapeutic Health Services.

She said she could not explain the Urban League's difficulties but said the youth-violence effort has paid dividends by reaching at-risk kids.

"We were able to do some very important things to help kids stay out of some trouble," Taylor said.

Even before losing its city contract, there was some indication the Urban League was having financial difficulties. "It was always a rush to make sure we turned around their bill as fast as possible so they could meet their payroll," Lockhart said.

When the city late last year declined to pay the Urban League bonuses of several thousand dollars on the youth-violence effort, the organization complained and threatened to go to the City Council or mayor, Lockhart said.

Second blow

A second blow came when the city drastically cut the Urban League's other major contract that supported its Contractor Development & Competitiveness Center.

The CDCC was created in 2002 to help small minority-owned businesses win construction contracts. The city spent about $480,000 a year between 2003 and 2010 on the CDCC, according to McGinn's office.

That was reduced to $100,000 this year, and city departments were encouraged to seek other competitors to do similar work, Deputy Mayor Darryl Smith said.

Requiring more competitive bidding for contracts "is the direction we're going" with all city services, Smith said.

"It's difficult for the public to buy that you're not going to work your contracts in that way," he said.

CDCC program

The state audit accused the Urban League of overcharging the school district to fund its CDCC program.

Auditors said the school district was overcharged by the Urban League for services that did not benefit the district — including up to $15,000 a month for "general overhead and administration."

The Urban League didn't document how the charges benefitted the school district, but it stated repeatedly that the money was needed "to keep the doors open," auditors said.

The State Auditor's Office now is examining the CDCC as part of its regular audit of the city of Seattle, spokeswoman Mindy Chambers said Wednesday.

Urban League, politicos got school money under investigation

(from SeattlePI)

The Urban League of Metropolitan Seattle and several prominent political figures were among the vendors who received "questionable" payments from a Seattle Public Schools program that is the focus of a criminal investigation.

A probe by the state Auditor's Office into the program revealed $1.5 million for services with a "questionable public purpose" and $280,000 for services that were never provided. The audit has since led to an investigation by Seattle police and the King County Prosecutor's office under a secretive "inquiry judge" process in which witnesses and records can be subpoenaed, according to source in the prosecutor's office.

The investigation is focused on the district's now defunct Regional Small Business Development Program, which was created to encourage small locally-owned minority businesses to bid on school district projects. Small businesses with gross revenue under $1 million qualified for the program.

The program's manager, Silas Potter, resigned June 7 as the investigation was starting. Potter reported to Fred Stephens, the former director of facilities and construction, who resigned from the school district in July and has since been appointed as deputy assistant secretary for administration U.S. Department of Commerce.

The audit faulted Stephens for not adequately supervising the program and not establishing a system of internal controls to guard against waste or misuse. District program staff told auditors the "District did not receive much benefit from work provided by several vendors and that Potter "wanted support from prominent members of the community," according to the audit report.

Despite Potter's resignation, he created his own private company with the same name as the school district's program. He was briefly retained as a consultant for another two weeks. He hired a vendor to write grants for the private company and allegedly defrauded the City of Bellevue, which paid $39, 873 because city officials thought they were participating in district's small business program.

The audit began after district officials received a $35,000 check from Tacoma Public Schools that had been deposited into Potter's company's account. Potter gave the district a $35,000 cashiers check after the district filed a police report, according to the audit.

Names of people and organizations that were hired under the program to provide outreach, instruction, consulting services, marketing and lobbying were not listed in the report. But they were provided to seattlepi.com by the state Auditor's office. Among the names of those were hired as contractors under the program were the Urban League, a former state legislator, a former head of the state Democratic Party and a former Port of Seattle administrator.

In some cases, those hired as contractors were not aware that Potter wasn't authorized to contract with them, according to the report.

"We're not passing judgment on vendors," said Mindy Chambers, a spokeswoman for the state Auditor's Office. "These are places where the district didn't have systems in place to look at what people are being billed for. Whether people were correctly charging for their time or overcharging, will be up to the district to sort out."

Among some of the names and organizations:

  • The Urban League, a nonprofit that provides housing, employment and educational services to minorities and other disadvantaged people , was paid $25,000 for a software subscription fee for a database designed to match small business owners with general contractors. District employees said they never used the database and the vendor reported it was not functional, according to the auditor's report.
  • A consulting firm started by Elaine Ko, former director of social responsibility with the Port of Seattle, received $17,800 to meet with state legislators and conduct community outreach that turned out to be related to Potter's private company.
  • Potter also approved contracts to lobby state legislators when he had no authority to do so. Vendors who were hired included Ko, Charles Rolland, former head of the state Democratic Party and former member of Community and Parents for Public Schools of Seattle; Velma Veloria, former state legislator; and Eddie Rye, who, according to King County's website , is a business leader and community activist who prompted King County to change its logo from the crown to the image of Martin Luther King Jr. They were unaware that Potter had no authority to approve the contracts, according to the report.

    Rolland, Rye, Tony Orange, former executive director of the Washington State Commission on African American Affairs and former head of the Central Area Motivation Program, and Ginny Noble with the Contractors Resource Center, were paid as consultants to attend weekly meetings at the district administrative offices. According to the audit report, the meetings lasted 1.5 hours but the consultants billed the district two to three hours for the meetings.

    Orange also billed $58,000 for outreach and recruitment work in 2009 and 2010 for the district's "Direct Hire and Apprenticeship" program that the Auditor's Office viewed as excessive given only 150 people were recruited, according to the report.

  • The district also paid Rolland at least $6,000 to create and maintain a database for the program that was "not functional" when the district received it. Rolland billed 120 hours to develop the database but it contained only a "list of student names and other identifying information," according to the audit report.

    Among the contracts deemed as losses to the school district:

  • The district paid $163,000 to Grace of Mercy, a nonprofit. The school district paid for classes on dates when no classes were taught. "Class sign-in sheets and class evaluations provided by the District show this vendor attended classes as a student on dates the vendor billed for teaching. The program manager approved the invoices, certifying that services were rendered."
  • Another $78,000 was paid to Banner Cross, which is described as a nonprofit mentoring organization on its website, for instructional services between November 2006 and April 2007, and for "development", including lesson preparation, team meetings, and communications assistance between May 2007 and August 2007, according to the report.

    But, district records "show the classroom reservations scheduled for that time period were canceled in January 2007," according to the audit report. Also, there were no class sign-in sheets for May through August 2007.

    Banner Cross is registered to Dr. Leon "Skip" Rowland, according to the state Auditor's Office. Rowland also is under contract with the Greater Seattle Chamber of Commerce to serve as executive director of the Urban Enterprise Center, which handles outreach to small, culturally-diverse businesses.

    In a statement, Superintendent Maria Goodloe-Johnson said the school district had since shut down the program and installed tighter financial oversight.

    "I am very angry that any school district employee would consider using this or any other program fraudulently and for their own personal gain. Such a use would be an abuse of taxpayer funds and an appalling violation of our community's trust," she said.

    The school district's general council and school board president Steve Sundquist responded to the audit with a list of bullet points about how the district is trying to fix the problem. Among other steps, the board commissioned an investigation into how funds were mismanaged, appointed an ethics manager to oversee complaints and launched an anonymous hotline that lets district employees and others report fraud and misconduct.

    The statement continued: "We agree that district management failed on several fronts, including lack of employee oversight, failure of internal controls, failure of the internal audit function, and lack of an adequate means for employees to raise their concerns."

    The school board is expected Friday to receive a report from Seattle attorney Patricia Eakes, whom the district hired to review issues raised in the audit, Sundquist told seattlepi.com.

    The report will be discussed Tuesday during a meeting in executive session and then dealt with publicly during next Wednesday's school board meeting, Sundquist said.

    "We're all extremely outraged by it. The whole thing is unacceptable," he said. "We feel a strong commitment to the community to get to the bottom of it. We'll do whatever we need to do to restore public confidence."

    The district is adding a member of the public to its audit committee, and legal counsel has been hired to recover losses from those at fault.

    The criminal investigation into Seattle Public School finances should have no effect on a Seattle levy that would augment education funding, City Councilman Tim Burgess said Wednesday.

    Burgess, the Council lead on the Families and Education levy, said there should be no link between the schools scandal and the separate ballot measure.

    Earlier this month Mayor Mike McGinn announced the proposed $231 million, seven-year levy. If the City Council OKs the measure and it's approved by voters in November, the average household would pay about $134 a year in property taxes. This measure would replace one approved in 2004, a $117 million levy that cost the average household about $65 a year. Funding would be focused on the 23 Title 1 schools in Seattle. Those are schools that meet a federal requirement for additional funding because a high percentage of students come from poorer families. The levy would invest in programs for students from pre-school to high school, including continuing to provide pre-school space, at-home early learning skills, support for at-risk students, summer learning programs and expand school-based health centers.

    "I think, from my perspective, it's full speed ahead on our process of evaluating the levy and taking a (Council) vote later in March," Burgess told seattlepi.com.

    Burgess stressed that any monies spent from the levy would be awarded by and administered by the City, not the school district.

    "Levy funds are spent only after performance-based contracts are awarded. And all levy funds are tied to very specific and measurable outcomes. And we take funds away when our outcomes are not being achieved."

    Burgess added that he was pleased that the School Board has taken quick steps to address the questionable use of funds. "They moved very quickly last year to launch their internal investigation. They notified civil authorities in the King County Prosecutor's office. I just strongly affirm those moves."

  • Charges Dropped: Man Suspected of Skimming Equity from Distressed Homeowners.

    Prosecutors have dropped mortgage fraud charges against a man accused of skimming home equity from distressed homeowners

    The case against Thomas Cuomo could not stand in the wake of an e-mail and paper trail showing the mortgage company he was working with wasn't the victim of fraud - but instead the possible cause of it.

    Cuomo, who once was a housing counselor for the Jacksonville Urban League, bought homes from people in foreclosure. At one time, he was suspected of skimming out what equity had been built up and renting them back to the original owners, promising them a chance to buy the houses back.

    But the houses slipped back into foreclosure.

    He was first charged in 2007 with money laundering and mortgage fraud after state investigators found similar stories from nearly a dozen people in Duval and Clay counties. That case was dismissed on a technicality.

    In 2008, he was charged again, this time accused of taking out fraudulent loans.

    Mitchell Stone, Cuomo's attorney in the 2008 charges, but not the previous case, said a simple e-mail trail showed that Cuomo tried to correct wrong information on his mortgage applications. For example, he said, loan documents said one of the homes was going to be owner-occupied, but Cuomo tried to correct the information to say it would be a rental.

    It was Countrywide and other lenders, according to Stone, that refused to correct the wrong information so that it could make the loan, then bundle and sell it with other risky mortgages. The case is a microcosm of the wider mortgage meltdown that has sent the economy into a tailspin.

    April Charney, an attorney at Jacksonville Area Legal Aid and one of the nation's experts in foreclosure law, is defending one of the foreclosures on behalf of the tenant, Lester Thomas, who sold his house to Cuomo. Thomas still lives there because the bank has not been able to prove it has the right to foreclose on it.

    Charney said the case represents many of the problems with the mortgage crisis: Irresponsible lenders and irresponsible borrowers, scams perpetrated on low-income people in dire straits and the improper securitization of high-risk loans.

    And, she said, it illustrates why law enforcement agencies must put more effort into investigating such cases.

    From Jacksonville News

    Urban League gets $15 Million Stimulus Grant

    The Urban League of Metropolitan St. Louis said Monday that it will receive about $15 million in funding for its weatherization program from the economic stimulus package through the Missouri Department of Natural Resources.

    The Urban League plans to hire 20 to 25 weatherization auditors over the next 90 days, according to spokeswoman Angelia Bills. The organization will be employing its subcontractors to do the actual weatherization work.

    The new contract starts in June and runs for 18 months. The Urban League’s original funding for the program was $1.4 million. The nonprofit said the added funding will allow it to serve about 2,000 city residents over the new contract's term. The income guidelines for the expanded weatherization program will include residents with income at the 200 percent of the federal poverty level, according to a release from the Urban League.

    “We are truly excited, because this grant will both increase energy efficiency and create jobs in the greater St. Louis area,” said James Buford, president and CEO of the Urban League of Metropolitan St. Louis, in a statement.

    The Urban League of Metropolitan St. Louis Inc. is a civil rights and human services organization. The agency received $13.1 million in total support and revenue for the fiscal year ended Dec. 31, 2007.

    From the St. Louis Business Journal

    Urban League of Greater Hartford Disciplines Its CEO

    By JEFFREY B. COHEN |The Hartford Courant
    February 14, 2009

    James Willingham violated his contract with the Urban League of Greater Hartford when he did $15,000 in consulting work for the company that runs the city's massive school construction project, the league has confirmed.

    The league said this week that it had disciplined Willingham — its chief executive officer — for the arrangement that "conflicted with the league's policy on outside employment." It would not say what that discipline entailed, and more than two dozen members of the league's board either declined to comment or did not return phone calls.

    The league looked into Willingham's consulting arrangement with Diggs Construction after he acknowledged in a story in The Courant that Diggs had paid him $15,000 in 2006. In 2001, Willingham was on the six-member committee that selected Diggs to oversee the city's school construction.

    Although it disciplined Willingham, the league's board "expressed its confidence" in his ability to lead the agency. Willingham declined to comment.

    Although not a developer, Willingham — who federal records show made about $185,000 in the 2007 fiscal year at the Urban League — said that he used his contacts with the Urban League and his fraternity, Kappa Alpha Psi, to help Diggs land a $20 million construction job in Texas.

    "I didn't do anything wrong," Willingham said in December.

    Willingham was one of three people on the six-member committee that chose Diggs Construction to later get paid by Diggs.

    Another was former city Councilman Louis Watkins, who was chairman of the selection committee and who got an initial one-year, $3,000-a-month contract with Diggs to work as a liaison with the Hartford community in 2006. As of December, Watkins still worked for Diggs.

    The third was D. Anwar Al-Ghani, who by the time his contract with Diggs Construction expires in April will have made about $680,000 working as a liaison between Diggs and its minority contractors.

    Concerns about Al-Ghani's arrangement have apparently contributed to the stalling of his current effort to be reappointed by the Hartford city council to the board of the Metropolitan District Commission.

    The reconstruction of Hartford schools has caught the attention of a state grand jury investigating allegations of corruption at Hartford city hall, although the scope of that interest remains unclear.

    At least two people familiar with the investigation said that the grand jury had asked questions about who has been hired to work on the schools project and why.

    From the Hartford Courant

    National Urban League Lobby Watch

    National Urban League

    National Urban League

    IssueNo. of Reports*
    Fed Budget & Appropriations14
    Labor, Antitrust & Workplace14
    Civil Rights & Civil Liberties1
    Economics & Econ Development1


    For more Information Cut and Paste above link

    Urban League Finances Under Fire Again

    Clark County is holding back federal money from the local Urban League because a recent review found double billing, problems with receipts and a lack of proof that one of the organization’s programs was actually helping the poor pull their lives together.

    At issue is a grant of $67,000 that was to be used to help people who were having trouble paying utility bills or rent. The county found that the Urban League paid only part of what clients owed on their bills. The nonprofit organization then asked those clients to pay back 60 percent and billed the county for the same cases. The Urban League issued no receipts to some clients. At other times, clients got receipts but the organization entered the payments under “miscellaneous income.”

    And still another finding: There were no plans for helping clients get back on their feet, a condition of the grant.

    The Urban League has to correct most of the problems within 30 days to draw again from the grant, said Shawna Parker, analyst at Clark County Community Resources Management, the division that oversees the federal money.

    Parker said the problems with the program are serious, adding there are “concerns about whether the organization can manage the money.”

    “There is no accounting or justification of the taxpayers’ money, no assurance it is being used wisely and for the purposes it was intended,” she said. In sum, “the goals of the services are in doubt.”

    If the money is cut off, it will be the third time in the past four months that a local government has taken back federal dollars from the Urban League. In all three cases, the nonprofit group failed to meet terms of contracts attached to grants, officials said.

    Previously, the poverty-fighting organization had trouble meeting the milestones for a $95,000 grant to help seniors repair their homes. The Urban League failed to spend half the money by January. The organization told officials “the program had fallen apart” and suffered excessive turnover, said Tim Whitright, development manager of the Las Vegas Neighborhood Services Department. So the city extended the deadline to March 31. When that deadline wasn’t met, the city took back nearly $70,000 in late May, “a matter of making sure the funds get out to the community,” Whitright said.

    The city is managing nearly $5.3 million in federal Community Development Block Grants this year, but hasn’t had a problem of this size with any other nonprofit organization, Whitright said.

    North Las Vegas found the Urban League couldn’t spend $57,000 from the same federal source, also meant for repairing the homes of seniors. North Las Vegas took back its money in June.

    Parker also discovered more than $110,000 in unspent money for seniors from a $150,000 grant nearly 15 months old. If the money is not used by Dec. 31, it will also be taken back, she said. Further, the county discovered that the $40,000 spent to date went to one contractor. Federal rules require that the work be bid out.

    At the Urban League’s board meeting in June related troubles were on the table as board members discussed the need to prepare a plan for cutting programs. In building up its budget to about $4.5 million during the second half of its four-year history, the organization apparently took on too many grants without sufficient qualified staff to handle them.

    Executive Director Ray Clarke said in June that his staff would have the reduction plan ready in 30 days.

    On Friday, Clarke had no comment on any plan to cut programs, the county’s findings, or the earlier pullbacks of funding.

    Instead, he encouraged taking a firsthand look at “the positive impact that the Las Vegas-Clark County Urban League is having in the community,” adding that he is “very encouraged by the progress (the organization) continues to make.”

    From the Las Vegas Sun