Money from 2018 sales tax isn’t being spent fast enough

While city and state governments project historic tax revenue losses, money raised by a Denver sales tax increase approved in 2018 isn’t being spent fast enough, Denver Auditor Tim O’Brien says.

Denverites approved the Caring for Denver sales tax increase in 2018 to fund grants for mental health services, suicide prevention, opioid and substance abuse, and homeless case management. These are issues at the top of residents’ minds, especially during the coronavirus pandemic, he told The Denver

Post.

As of May, the foundation had about $ 41.5 million in unspent tax revenue, O’Brien found in an audit. At the same time, the foundation lacked a strategic plan for its operations and basic structural organization for its board members and employees, including disparate conflict- ofinterest disclosures, he said.

“I didn’t find anything that would be fraudulent or malfeasance,” O’Brien said. “It’s never too late to develop ( a strategic plan); ideally that is the kind of thing you would like to see in place before you’d start administering the program.”

Through the millions of dollars in grants it has doled out, the foundation has done good work, O’Brien said. That includes the widely lauded STAR and co- responder programs, which dispatch mental health experts for certain 911 calls and pair those experts with police officers on others.

The foundation is making progress on O’Brien’s recommendations, said Executive Director Lorez Meinhold. The nonprofit’s board adopted a strategic plan in September and will spend millions more in November.

“A year into our operations we have evaluated over 180 programs, funded over 60 for more than $ 16.8 million,” Meinhold said. “In November we anticipate giving away another $ 6 million at least.”

That leaves tens of millions of dollars left unspent, Meinhold acknowledged, but the foundation is already moving faster than most.

Although voters approved the new tax in November 2018, funds didn’t start rolling in until September 2019. Until then there had been no money to pay staff, much less develop a strategic plan or fund grants, she said.

“Most nonprofits take six to 18 months to develop a strategic plan,” she said. “We were building that framework and developing a call for proposals. We’ve been releasing dollars responsibly. We have to act carefully as well as quickly.” Some of the grants currently under consideration include supporting neighborhood efforts to bring mental health support to recreation centers, working with pregnant women misusing substances, and encouraging different types of recovery through art, Meinhold said.

The foundation is also expecting additional grant applications from city officials.

Indeed, Mayor Michael Hancock said his administration would request at least another $ 500,000 from the foundation to boost the STAR Program further.

O’Brien said city officials could submit additional grant applications for similar programs, but that cash must be used to expand existing programs or launch new ones. It can’t be used as a substitute for dwindling general fund dollars.

Part of the foundation’s spending problem, O’Brien said, is that there appears to be a lack of understanding from other nonprofits and community organizations about how to apply for a grant. Meinhold said the easiest way to find that information is on the foundation’s website at caring4denver.org.

The organization will submit its full strategic plan to the auditor by the end of the year, she said, and another, independent audit in March will examine its financial policies and procedures.