Government & Politics
 

NOLA for Life grantee fails to live up to promise of building publicly-financed community center

Family Center of Hope community center

Steve Myers / The Lens

A nonprofit organization called The Family Center of Hope has received more than $2 million in federal grants to build a community center at Washington and Broad streets. More than five years later, the building remains vacant, and work is at a standstill. Now the organization has been given $40,000 to provide counseling services as part of the city's NOLA for Life anti-violence program.

The nonprofit group The Family Center of Hope has failed to deliver on its promise of building a community center at Washington and Broad streets — a project backed by $2.7 million in federal funds routed through the city and state. But that hasn’t stopped the city from awarding the politically connected nonprofit another $40,000 from the city’s NOLA for Life anti-violence effort.

The Family Center of Hope started working on the community center in 2007. It’s still not finished. Due to legal disputes, no work has been completed in more than a year. The contractor claims the nonprofit owes him more than $900,000.

Those legal disputes have caused the city and state to hold off on issuing checks for $250,000 for the community center, according to a lawsuit the Family Center filed against the project’s architect.

But in March, the city and the Greater New Orleans Foundation decided to entrust The Family Center of Hope with another grant. The group is one of nine organizations to receive $40,000 “Community of Practice” grants from the NOLA for Life Fund.

Fourteen other groups received smaller grants ranging from $5,000 to $15,000. Among other things, that money is funding CD production, field trips and concerts.

The NOLA for Life Fund is a key part of the mayor’s comprehensive anti-violence campaign, which also includes New Orleans Ceasefire, the Mayor’s Strategic Command to Reduce Murders and the new Multi-Agency Gang Unit.

The city created the fund last year with a $1 million contribution from Chevron and $250,000 from the Wisner fund, the city-controlled charitable trust. The Greater New Orleans Foundation was enlisted to manage the grant, but the city has been involved throughout the process. It issued the request for proposals, half of the selection committee was made up of city employees, and the city announced the winners in February: “City Awards $500K in NOLA FOR LIFE Grants.”

Although the NOLA for Life Fund includes $250,000 in public money, the Greater New Orleans Foundation told The Lens that the fund is not subject to public records requests or the city’s open contracting process. Ellen Lee, the foundation’s senior vice president of programs, declined to answer questions about how grantees were chosen, claiming that the first round of grants came only from Chevron’s share.

“I do hope you realize that none of the funds disbursed to nonprofits in this round of grantmaking were derived from the public sector or Wisner funds,” Lee wrote in an email to The Lens.

The Lens has received other grants from the Greater New Orleans Foundation, and the two have worked together to pursue national grants from private foundations.

Despite Lee’s position, the city provided all grant applications in response to a public records request.

In emails to The Lens, Landrieu spokesman Ryan Berni said the city is “confident the Greater New Orleans Foundation has recommended organizations providing outstanding services.” He went on to describe the foundation’s vetting process.

“These philanthropic grants are helping fund organizations that deliver outstanding programs and services to at-risk youth,” he said in response to another inquiry about the Family Center on Wednesday.

Questions about grant process

The Family Center of Hope is run by the Rev. Pat Watson, who is married to the Rev. Tom Watson, a former mayoral candidate. Tom Watson came to the aid of former U.S. Rep. William Jefferson — for his sentencing, Watson wrote a letter of support seeking leniency — after Jefferson was indicted on federal corruption charges in 2007. The Watsons co-founded the group, and both sit on the board.

Tom Watson is currently in his second six-year term on the Audubon Commission, having been reappointed by Landrieu last year.

Also on the Family Center board is Dorothy “Dottie” Reese, the wife of Civil District Court Judge Kern Reese and a partner at business consulting firm DMM & Associates. Dorothy Reese is also a member of the board of trustees of the Urban League of Greater New Orleans, which oversees Ceasefire New Orleans. She is a Landrieu appointee to the French Market Corporation’s Board of Directors.

At a recent meeting of the New Orleans City Council’s Criminal Justice Committee, Councilwoman Stacy Head — who ran against the Watsons’ son Corey Watson in the 2010 election for her former District B Council seat — called for greater public accountability in NOLA for Life grantmaking.

Head asked what the grantees do “for the good of the NOLA for Life project” and questioned the finances of the organizations. “Of course we can get their 990s [IRS reports for nonprofit groups] online. But seeing how they leverage their dollars, whether they get money from other philanthropic sources, whether they only get government funds, whether they get, say, millions of dollars for capital projects, for example, and that’s their only source of income.”

She never mentioned The Family Center of Hope, but a recent audit showed that 99 percent of the nonprofit’s revenue came from government grants.

The NOLA for Life Fund request for proposals sought groups with solid track records “providing quality programs and services with demonstrated impact.” It also told applicants to provide projected budgets and, if they were seeking a Community of Practice grant, detailed financial information for the prior three months.

The Family Center of Hope submitted a perfunctory projected 2013 budget, but not the detailed financial information. The 2011 audit was the most recent financial information in its grant application.

Community center languishes despite influx of public funds

Since 2008, The Family Center of Hope, first founded in 1989, has taken in more and more public money, according to financial reports filed with the Louisiana Legislative Auditor and the IRS. The group’s annual revenues, according to its filings with the IRS, went from $73,000 in 2007 to more than $1 million in 2010.

According to its most recent audit submitted to the Louisiana Legislative Auditor, 99 percent — $873,000 — of The Family Center of Hope’s revenue in 2011 came in the form of federal, state and local government grants. The group generated just $1,642 in nongovernmental contributions that year, according to the audit, which also reported just $27,000 in expenses for the year.

Most of that income has been earmarked for construction of the community center at 4137 Washington Ave.

This week, the building was dark and empty. Visible through a tinted, dirty window was a placard showing the building as it was envisioned, with palm trees lining the sidewalk. Instead, one window was cracked, wires wires hung from a wall near the rear door, and a couple of signs advertising “Baby College Coming Soon” lay next to litter on the ground.

According to court filings from the contractor, Metairie-based M. Slayton Construction, no work has been done on the building since February 2012. The Family Center of Hope owes Slayton more than $900,000 in back pay, the contractor claims in legal filings. Nearly $350,000 of that is “downtime” pay for routine safety checks and maintenance that Slayton has performed since construction stopped.

In an interview, Pat Watson said she is not aware of a $900,000 claim from Slayton.

Her group bought the building in 2002 with a $350,000 federal Community Development Block Grant from the city. Between 2007 and 2009, it was promised nearly $2.3 million from the U.S. Department of Housing and Urban Development. Of that, $500,000 was routed through the state of Louisiana and, ultimately, $1.8 million through the city of New Orleans — a significant increase from the city’s initial commitment.

“We got, I think, $600,000 from the city at first,” Pat Watson said. “We went in and found that there was asbestos and all kinds of environmental issues in the building. So we had to use most of the beginning funds just for remediation.”

The original budget for the project was $1.5 million, according to court records. Total billings have grown to $2.6 million, due in part to change orders the group claims resulted from errors in the design by its architect, St. Martin Brown & Associates.

Pat Watson said design flaws necessitated “excessive change orders” for the community center project. Joseph St. Martin said his lawyer advised him not to comment due to the lawsuit.

“I don’t know why you’re dealing with our project as a stalled project,” Pat Watson said. “There are many stalled projects around the city for the same reason: money. That project is like any other project. Most projects go over budget.”

A number of subcontractors have filed liens against Slayton and the Family Center claiming they haven’t been paid. In addition, two glass companies and an electrical company have sued Slayton and the Family Center for breach of contract. Slayton president Michael Slayton did not respond to repeated requests for comment; a company employee would only be quoted if he weren’t identified.

Family Center focuses on counseling at-risk youth

As Pat Watson pointed out, the NOLA for Life grant doesn’t have anything to do with the community center. It’s for something called Project Restore, a “sentencing-alternative” program for offenders between the ages of 12 and 21, according to the application.

“We work with kids who were referred by the Juvenile Court, walk-ins, churches, those on electronic monitors, and we bring them through a series of cognitive behavioral work for 12 weeks,” said Pat Watson. “We’re working with those teenagers who are most at risk of killing or being killed.”

Three Orleans Parish Juvenile Court employees who deal with such programs told The Lens on Wednesday they hadn’t heard of Project Restore but weren’t able to speak on behalf of the court. The Lens hasn’t yet heard from the judicial administrator’s office.

The NOLA for Life website’s description of the Family Center’s work is wide-ranging, saying the group:

promotes services that address areas of community violence, drug use, school dropouts, teenage parenting and other dysfunctions within high risk families. Services include a workforce development program, empowerment seminars, conflict resolution programs, manhood development program, and parent involvement component.

Project Restore received a $60,000 city grant in 2010 to provide counseling services to 50 low- and middle-income participants who reside in New Orleans. The program surpassed its participant goal but did not collect residency or income information for 31 of the 56 kids, according to a city report filed after the grant period was over.

The counseling took place at the Family Center’s administrative offices, housed at the Rev. Tom Watson’s church on St. Charles Avenue.

The group reported receiving the grant in its annual audit, performed by an independent firm and provided to the state, but counseling is not mentioned in the audit or its Form 990. The 2010 Form 990, the last available on GuideStar, notes only one education program with a cost of $5,966.

The plan for this year is to serve 20 participants at a cost of $2,500 apiece, according to the application to the NOLA for Life Fund.

The group asked for $50,000, of which $10,000 was earmarked for Pat Watson’s salary. Sign-in sheets provided by the Greater New Orleans Foundation show Pat Watson has been attending the monthly Community of Practice meetings, a grant requirement.

As a condition of accepting the grants, groups such as the Family Center must agree that the money can be used only for NOLA for Life programs. All grantees are required to produce a report on their activities, but not until May 2014, two months after the end of the grant period.

The grant agreement says that the foundation can require a nonprofit to return the money if it doesn’t follow through on what it promised to do.

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  • bcomeaux

    “Most projects go over budget.” Now that’s just funny. Might be time to rethink the old budgeting process.

  • http://www.twitter.com/AhContraire AhContraire

    Don’t be surprise the initial study and contractors who estimated the job and what need to be done in the first place where BUDDIES, campaign contributors and part of some “under-the-table money” of the non-profits mentioned. And don’t be surprised that DBE status was used.

    Does this remind you of the concrete work done a few years ago at Armstrong Park next to the French Quarter by perhaps DBE’s? It was done so improperly it had to completely be redone.

    http://www.wwltv.com/news/Citys-contract-with-ex-con-results-in-slow-construction-time.html

    http://www.bestofneworleans.com/blogofneworleans/archives/2011/04/27/landrieu-re-blasts-nagin-on-the-mess-in-armstrong-park

  • Christa Allan

    So, where have these troubled youth received services since 2010? And this is on the low end of Kohlberg’s stages of moral development: ” Pat Watson said. “There are many stalled projects around the city for the same reason: money. That project is like any other project. Most projects go over budget.” Deflection is not responding. Neither is using the “everyone else is doing it.”defense.

  • Nierue

    This article is very disappointing, as is the fact that you are not publishing comments that are critical of it. I know for a fact that several detailed comments have been submitted. I won’t waste my time on submitting another, assuming that it too will be ignored. Shame on you.

  • http://thelensnola.org/ Steve Myers

    After reading this, I checked our moderation queue and published one that was incorrectly flagged as spam. That sometimes happens with comments by new users, as well as ones that are long or have links. With that, I can say definitively that we’ve published all comments about this story, including critical ones.
    -Steve Myers, managing editor

  • Albert Ruesga

    I’m writing to set the record straight on some of the claims made in this article.
    First, there were inaccuracies in your reporting that, in my view, added to the atmosphere of intrigue and wrongdoing manufactured by the author:

    1. You reported that “[t]he NOLA for Life Fund includes $250,000 in public money ….” This is false. The NOLA for Life Fund did not include a cent of public money. Grants to NOLA for Life organizations were made from funds contributed by private donors, as Ms. Ellen Lee correctly asserted. Our records show that there were 36 gifts to the Fund from private donors totaling $1,026,480.

    2. You reported that “The Family Center of Hope submitted a perfunctory projected 2013 budget, but not the detailed financial information. The 2011 audit was the most recent financial information in its grant application.” To begin with, you’re editorializing rather than reporting when you describe the submitted budget as “perfunctory.” One man’s perfunctory is another man’s “appropriate to the circumstances.” What’s your basis for implying that this budget was not appropriate for those who were conducting the grant review? You also imply, without stating so explicitly, that The Family Center of Hope’s submission of a 2011 audit was a sign of its falling short on financial reporting. As with most nonprofit organizations that have a calendar fiscal year, the audit for 2012 isn’t typically completed until well into 2013. Because the RFP was issued in late fall of 2012, the 2011 audit would have been the last audit available for nearly all organizations submitting proposals with a calendar fiscal year. You can check for yourself that The Family Center of Hope has a calendar fiscal year. Your statement about this organization’s audit is therefore misleading.

    I understand one of the implications of your article to be that because an organization has had contractor challenges with one of its buildings it’s therefore not qualified to provide the kinds of services that were supported by the NOLA for Life grant. This is an odd implication given the number of contractor challenges faced by many individuals, nonprofits, and businesses in the Greater New Orleans area. The grant review teams were aware of The Family Center of Hope’s challenges with the community center at Washington and Broad streets. They were also aware of the organization’s good track record in serving black men and boys, the focus of the NOLA for Life project. Your article says nothing about the quality of the social services provided by this organization.

    Unfortunately your article is accompanied by only one image of The Family Center of Hope: the façade of the unopened community center, cropped to include as much litter-strewn lawn as possible. Perhaps including another photograph depicting the good work of the organization would have helped create a more balanced account.

    Albert Ruesga
    President & CEO
    Greater New Orleans Foundation

  • Nierue

    Thank you – I appreciate that. I’ll make sure that the others I’ve spoken to know how your system works. It’s possible that they didn’t submit their comments correctly.

  • http://thelensnola.org/ Steve Myers

    No problem, I’m sorry I didn’t spot it earlier. We really appreciate the comments people post, whatever they are. Our readers have substantial conversations and debates here, and that’s what we want.

  • Charles Maldonado

    Thank you, Mr. Ruesga. On point one, Ms. Lee did tell me that none of the grants disbursed came from the city. She did not say that fund was created without city dollars. In any case, the following is from a press release posted on the NOLA for Life website and sent out to reporters in February: “The City of New Orleans contributed $250,000 to the fund.” http://www.nolaforlife.org/articles/city-awards-500k-nola-life-grants

    Point 2: From the request for proposals: http://new.nola.gov/getattachment/Mayor/Press-Releases/2012/20121114-City-announces-NOLA-FOR-LIFE-Fund-request/NOLA-For-Life-Fund-Request-for-Proposals.pdf/ “If applying for the CoP [Community of Practice Grant], also include the last three months of financial statements.” The Family Center applied for and received a CoP even though it did not submit that information. As for the use of the word “perfunctory,” here again is the Family Center’s current year budget: https://www.documentcloud.org/documents/706535-fch2013budget.html as opposed to another grant winner, the Youth Empowerment Project: http://lensnola.wpengine.netdna-cdn.com/wp-content/uploads/2013/06/YEPBudget.pdf

    Finally, GNOF had more than enough opportunities to comment on this nonprofit group or the selection process. Instead it ignored my repeated questions — submitted via email and phone — for a week, then told me that GNOF would not be able to answer them because of the “nature of our philanthropic work” in which private donors “expect a level of confidentiality about their grantmaking investments.” GNOF then referred any further questions to the city.

  • Guest

    Thank you, Mr. Ruesga. On point one, Ms. Lee did tell me that none of the grants disbursed came from the city. She did not say that fund was created without city dollars. In any case, the following is from a press release posted on the NOLA for Life website and sent out to reporters in February: “The City of New Orleans contributed $250,000 to the fund.” http://www.nolaforlife.org/articles/city-awards-500k-nola-life-grants

    Point 2: From the request for proposals: http://new.nola.gov/getattachment/Mayor/Press-Releases/2012/20121114-City-announces-NOLA-FOR-LIFE-Fund-request/NOLA-For-Life-Fund-Request-for-Proposals.pdf/ “If applying for the CoP [Community of Practice Grant], also include the last three months of financial statements.” The Family Center applied for and received a CoP even though it did not submit that information. As for the use of the word “perfunctory,” here again is the Family Center’s current year budget: https://www.documentcloud.org/documents/706535-fch2013budget.html as opposed to another grant winner, the Youth Empowerment Project: http://lensnola.wpengine.netdna-cdn.com/wp-content/uploads/2013/06/YEPBudget.pdf

    Finally, GNOF had more than enough opportunities to comment on this nonprofit group or the selection process. Instead it ignored my repeated questions — submitted via email and phone — for a week, then told me that GNOF would not be able to answer them because of the “nature of our philanthropic work” in which private donors “expect a level of confidentiality about their grantmaking investments.” GNOF then referred any further questions to the city.

  • Charles Maldonado

    Thank you, Mr. Ruesga. On point
    one, Ms. Lee did tell me that none of the grants disbursed came from the
    city. She did not say that fund was created without city dollars. In
    any case, the following is from a press release posted on the NOLA for
    Life website and sent out to reporters in February: “The City of New
    Orleans contributed $250,000 to the fund.” http://www.nolaforlife.org/art

    Point 2: From the request for proposals: http://new.nola.gov/getattachm
    “If applying for the CoP [Community of Practice Grant], also include
    the last three months of financial statements.” The Family Center
    applied for and received a CoP even though it did not submit that
    information. As for the use of the word “perfunctory,” here again is the
    Family Center’s current year budget: https://www.documentcloud.org/… as opposed to another grant winner, the Youth Empowerment Project: http://lensnola.wpengine.netdn

    Finally, GNOF had more than enough opportunities to comment on this
    nonprofit group or the selection process. Instead it ignored my repeated
    questions — submitted via email and phone — for a week, then told me
    that GNOF would not be able to answer them because of the “nature of our
    philanthropic work” in which private donors “expect a level of
    confidentiality about their grantmaking investments.” GNOF then referred
    any further questions to the city.

  • Charles Maldonado

    Well, that comment should be under my name and a reply to the post by Mr. Ruesga himself. Not sure what the problem is.

  • Tracie Washington

    “Thank you, Mr. Ruesga. On point one, Ms. Lee did tell me that none of the grants disbursed came from the city. She did not say that fund was created without city dollars.” Really? That’s the response from The Lens? In other words, she (Ellen Lee) told me it wasn’t public money, but she didn’t TELL me it wasn’t public money.

    You folks discredit true journalism.

  • Charles Maldonado

    We have been given every indication that the NOLA for Life Fund includes public dollars. I refer you again to the press release above and to the program’s website, which has a contributions counter that includes the $250,000 from the city. Even in the event that the city has not YET issued a check, it’s a flimsy technicality to rest this argument upon. The city has made a commitment of city funds to it (this confirmed by the mayor’s office). And the fund was cocreated by the city with that commitment.

  • nickelndime

    I, for one (and it would appear that I am in the minority of commenters here) think that the Maldonado article is excellently researched and well-written. By the affiliated names who have taken the time to respond and critique the article, it looks as though a lot of information (cast them in a bad light, questioned their involvement and their motives) has been brought out into the open for the public to see. Isn’t that what investigative reporting is all about? If there is anything that is false, then sue Mr. Maldonado and The Lens ala “Girl with the Dragon Tatoo” (Ha!) Politically connected nonprofits AND the city of New Orleans continue to arouse suspicion that what the public perceives and expects has happened (is happening) is true – all true. We must keep in mind, however, that the names that frequently appear in print (catch the heat) are still the little people (they have limiited funds, albeit public funds) and are not the real creators of wealth (now, when you get ahold of these individuals, then we will really have something). But, since we have to crawl before we walk (and until then), the only way to get to the big fis is by going after the obvious (the blatant, the proud), and this is exactly what Mr. Maldonado is doing. The “obvious” (appear in the headlines, made public, under scrutiny, charged and sometimes indicted (but rarely serve time), in the news, on television, blogged, twittered…) are the henchmen (or ladies). They are the doers of dastardly deeds (but are in pulpits and are on boards). They may catch the heat, but they are handsomely paid to do so (preach, write letters, public comments, respond to reporters, demand apologies and retractions, corrections, and public humiliation, respond with “off with their heads” mentalities and namecalling. So, whose ox did Mr. Maldonado gore today? The Greater New Orleans Foundation, the City of New Orleans, the Family Center of Hope…Excellent article.

  • Diogenes

    DomesticSub
    There is a much bigger story there and a much larger piggy bank that is being emptied without any oversight. The current administration has hidden a majority of the accounting of the Wisner money spent by the City. Some has gone to NOLA for Life, then funneled to other politically driven entities such as the Urban League while other money has simply been hidden from view. I am told that the last time the Wisner Lands Trust account balance was viewed was when Nagin left office…..it has been hidden from view to present.
    I wonder why? Seems to me the public might have an interest in seeing where all this money is going. The original Wisner documents have very specific charitable instructions on how the City is to spend the money.

  • DomesticSub

    Totally agree. The only real picture the public is getting here has to do with the true character of our mayor and his minions.

  • Anonymous Guest

    Mr. Ruesga, you state in your reply: “Unfortunately your article is accompanied by only one image of The Family Center of Hope: the façade of the unopened community center, cropped to include as much litter-strewn lawn as possible. Perhaps including another photograph depicting the good work of the organization would have helped create a more balanced account.”

    Two things in response to that. First, as a person who lives near the Family Center of Hope, I can tell you that the image presented with the article is a completely accurate description of the block on which that property lies. I haven’t seen a single person come by to take care of the property or the trash that litters the site since work halted more than a year ago. On a slightly unrelated, ironically tragic note, the street in front of the Family Center of Hope has seen three murders in the last 2 years (http://www.nola.com/crime/index.ssf/2013/03/nopd_investigates_murder_at_wa.html) as well two shootings within a block of the site since November, 2012, when the NOLA for Life RFP was released.

    Second, I’m not sure there is a photograph/image “depicting the good work of the organization” in question. The documents presented by the Lens (https://www.documentcloud.org/documents/706535-fch2013budget.html and https://www.documentcloud.org/documents/706532-citycheckprojectrestore.html) show that this is an organization incapable of spelling (what are “Peronnel” expenses?) and unable to document the work that they do: “31 [of 56 program participant files] lacked income and residency documentation.” So what exactly is the “organization’s good track record in serving black men and boys?” Perhaps this is something you could have shared in your response, because based on current evidence, we don’t know.

    Beyond that, you mention “the NOLA for Life Fund did not include a cent of public money. Grants to NOLA for Life organizations were made from funds contributed by private donors, as Ms. Ellen Lee correctly asserted. There were 36 gifts to the Fund from private donors totaling $1,026,480.”

    I’m not sure this is the best argument to make is this case. Obviously public monies have a higher level of scrutiny, but saying that–what appears to be–a poor grant making decision was made with privately raised funding certainly doesn’t bode well for future donations from those and other potential donors. Were I one of the 36 donors to the fund, with the information I currently have, I would not want my money going to an organization such as Family Center of Hope.

    Ultimately, this article is well-researched and written, and while it arguably has a bias, I believe that bias is in favor of transparency in all forms: decision-making, grant-making, documentation, reporting, compliance, etc., etc. How can the people hold government AND government proxies accountable for government initiatives (even those funded with private monies), if the people are unable to see how the government & its proxies make decisions?

    Way to go, Charles. I don’t often read the news, but when I do, I read the Lens.

  • Joanne Hilton

    Let’s get one thing straight. Private donations made to whatever non-profit entity are indeed the tax payer’s concern. Those who make these contributions are most certainly treating them as charitable deductions on their own tax returns, thus depriving the public coffers of whatever taxes should have been paid on that amount. So yes, Mr. Ruesga, it IS our concern.