Oak­land non­profit’s fail­ures went un­no­ticed

San Francisco Chronicle - - BAY AREA - OTIS R. TAY­LOR JR.

When a re­port by the Alameda County civil grand jury was re­leased last month, the rev­e­la­tion that the Oak­land City Coun­cil dis­re­garded open-gov­ern­ment laws was the bomb­shell. But that’s not all the re­port re­vealed. It also found that Alameda County pro­vided a $1 mil­lion bailout to a fi­nan­cially trou­bled East Oak­land non­profit. The grand jury found that the county Board of Su­per­vi­sors gave pref­er­en­tial treat­ment to the non­profit, Youth Up­ris­ing, over other com­mu­nity-based or­ga­ni­za­tions.

Youth Up­ris­ing runs ed­u­ca­tion, em­ploy­ment and well­ness pro­grams for at-risk chil­dren, and among its board mem­bers is county Su­per­vi­sor Nate Mi­ley.

You’d think that would put the county in a pretty good po­si­tion to know what was go­ing on at the non­profit, but the re­port says the county was clue­less. And it shouldn’t have been. Tes­ti­mony from wit­nesses, in­clud­ing county and Youth Up­ris­ing em­ploy­ees and an in­de­pen­dent au­di­tor, helped the grand jury con­clude that the county didn’t pro­vide suf­fi­cient over­sight to prop­erly pro­tect our tax dol­lars.

If the county, which pro­vides nearly half of Youth Up­ris­ing’s rev­enue, was pay­ing at­ten­tion, a fi­nan­cial col­lapse should’ve been de­tected be­fore it be­came im­mi­nent.

Be­fore it re­quired a bailout.

The grand jury didn’t find ev­i­dence that Youth Up­ris­ing’s short­falls af­fected the chil­dren it serves. Still, its find­ings serve as a warn­ing of what hap­pens when or­ga­ni­za­tions funded with public money go unchecked.

It’s a re­minder that it’s al­most im­pos­si­ble to help the peo­ple who need it most when or­ga­ni­za­tions de­signed to fa­cil­i­tate that help can’t man­age them­selves. In the end, we all lose. Youth Up­ris­ing got stuck in the mud three years ago when it at­tempted to root it­self in the ed­u­ca­tion sys­tem that has served scores of stu­dents in the neigh­bor­hood around Castle­mont High School, the com­mu­nity the or­ga­ni­za­tion pri­mar­ily serves.

In Au­gust 2015, Youth Up­ris­ing opened two char­ter schools — Castle­mont Pri­mary and Castle­mont Ju­nior Academy. The schools were ap­proved by the Oak­land Uni­fied School Dis­trict, which also ap­proved a lease to rent class­rooms at Castle­mont High School for about $88,000 a year.

The schools were to op­er­ate un­der a sep­a­rate non­profit, Castle­mont Com­mu­nity Trans­for­ma­tion Schools, that emerged from a pro­gram started by Youth Up­ris­ing.

In­stead, Youth Up­ris­ing’s fi­nan­cial well-be­ing be­came en­tan­gled in the shaky health of Castle­mont Com­mu­nity Trans­for­ma­tion Schools. An in­ves­ti­ga­tion by the Alameda County civil grand jury found that in the 2014-2015 fis­cal year more than $600,000 of Youth Up­ris­ing’s fund­ing was used for school ex­penses.

Both schools didn’t en­roll enough stu­dents.

Both schools ran out of money and closed within 18 months of open­ing. Wait, there’s more. As Youth Up­ris­ing was de­vel­op­ing the plan for the char­ter schools, it re­ceived $2.5 mil­lion from the San Fran­cisco Foun­da­tion for Castle­mont Re­nais­sance to de­velop an af­ford­able hous­ing project in the Castle­mont com­mu­nity. But Castle­mont Re­nais­sance didn’t have its own bank ac­count, so Youth Up­ris­ing acted as a fis­cal agent and put the money into its ac­count. For trans­parency rea­sons, the ac­count­ing should’ve been kept sep­a­rate.

That raised eye­brows, just not at the county level.

Youth Up­ris­ing’s board mem­bers raised con­cerns about its re­la­tion­ship with Castle­mont Re­nais­sance, and there were dis­agree­ments on trans­parency from the lead­er­ship. The in­ter­nal tur­moil led to board and staff turnover.

Through­out the trou­bles, Olis Sim­mons, Youth Up­ris­ing’s CEO, re­mained in con­trol. She also caught the at­ten­tion of the grand jury, which found “ir­reg­u­lar­i­ties” in her com­pen­sa­tion. Ac­cord­ing to its re­port, Sim­mons stepped away from man­ag­ing Youth Up­ris­ing for sig­nif­i­cant pe­ri­ods of time in the 2015-16 fis­cal year, yet she billed the county for her usual pay of nearly $100,000 for that pe­riod.

The re­port noted that Youth Up­ris­ing also col­lected funds from the San Fran­cisco Foun­da­tion for her salary. In to­tal, her pay was more than $200,000 — far higher than the aver­age pay of most heads of Oak­land com­mu­nity or­ga­ni­za­tions, the re­port found.

Still, in May 2016, all five su­per­vi­sors ap­proved the bailout with­out an ad­e­quate re­view of the or­ga­ni­za­tion they were sav­ing.

And get this: In ex­change for the bailout, Youth Up­ris­ing was re­quired to pro­vide an out­line of how the money was go­ing to be spent be­fore a check was writ­ten. Noth­ing was filed, and the grand jury found “no ev­i­dence that the county has fol­lowed up on its $1 mil­lion bailout to en­sure that cor­rec­tive ac­tion has been taken at Youth Up­ris­ing.”

It was as good as a blank check, be­cause, just three days after the money was de­liv­ered, the grand jury found a trans­fer of $820,614 from Youth Up­ris­ing’s ac­count to a sep­a­rate ac­count for the af­ford­able hous­ing project.

After all of this, Mi­ley made it clear that Youth Up­ris­ing re­tained his sup­port.

“I think the work Youth Up­ris­ing has done is vi­tally im­por­tant. I don’t think any­thing was done wrong,” he told me.

If any­thing, Mi­ley thinks Sim­mons got overex­tended with the schools and hous­ing project, en­deav­ors that were sup­ported by the Youth Up­ris­ing board.

“The dream was a big dream in terms of com­mu­nity trans­for­ma­tion, but I just think she wasn’t able to achieve the dream,” Mi­ley said.

I’m not as gen­er­ous as Mi­ley. To me, Youth Up­ris­ing lost fo­cus of its core mis­sion: help­ing chil­dren who have to crawl from the bot­tom with at least one arm tied be­hind their backs through pro­gram­ming that pre­pares them for a chance to suc­ceed.

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