OAKLAND — Youth UpRising, an organization that serves young people in an East Oakland neighborhood plagued by violent crime, has long been praised as a model community-based organization. Last year, Olis Simmons, president and CEO since the place opened its doors in 2005, was recognized by the White House for her organization’s summer learning programs.
Yet, according to the Alameda County Civil Grand Jury, that public image belied the turmoil behind the scenes, where staff in charge of the finances made a roughly $2 million budget mistake, anticipating that there would be that much more revenue coming in. Alameda County, Youth Uprising’s biggest funder, provided a $1 million emergency grant to help keep the organization afloat.
The grand jury report released this week recommends the county conduct a detailed review of Youth UpRising’s leadership and finances. It pointed out that the CEO’s compensation at $216,700 a year from 2011-2015 was far above similar community-based organizations in California, where the average salary was $113,000, according to a recent survey of 79 cities. Simmons disputes those findings.
The panel also said county officials should be keeping closer tabs on the nonprofit, which has received millions of dollars in public support over the years. There were no allegations of theft of funds. Rather, the panel raised concerns about improper co-mingling of money and questioned whether the organization had made necessary adjustments to prevent future financial problems.
“The county’s oversight of Youth UpRising was inadequate, fragmented and failed to uncover Youth Uprising’s financial and governance problems,” the report said.
The grand jury found that the budget shortfall was caused by leadership turnover and financial mismanagement. It said the nonprofit’s leadership had embarked on two major projects that took up resources and time, contributing to a financial crisis. These included a charter school initiative called Castlemont Community Transformation and Castlemont Renaissance, a mixed-income housing initiative.
Youth UpRising received approval from Oakland Unified School District to run two charter schools as part of its “cradle to career continuum of services on campus” and rented classroom space from the district at the Castlemont High School campus. However, both Castlemont Junior Academy and Castlemont Academy failed to enroll enough students and folded within 18 months.
“Did you expand too fast? And the answer is obviously yes,” Simmons said. “But if you’re going to take risks and be innovative, you’re going to occasionally make mistakes.”
Since its inception, Youth UpRising says it has served more than 14,000 young people, helping them with their education, job training, jobs, health services and an onsite clinic.
As she focused on the new initiatives, Simmons said, she put a new leadership team in place. When she found out about the budget error, she cut staff and expenses, which reduced the shortfall by half.
She then went to Alameda County Health Care Services Agency, which oversees Youth Uprising’s core contract, for help. The agency’s acting director, Rebecca Gebhart, recommended that the Board of Supervisors authorize a one-time $1 million grant to help the organization through its financial difficulties; it was unanimously approved.
But the grand jury report faults the supervisors and county officials for failing to follow up on the bailout funds to make sure they were spent for the intended purpose. The report cited an $820,614 transfer from Youth UpRising’s account to a separate account for the mixed-income housing program in May, three days after the county had issued the $1 million bailout check.
“The grand jury is very concerned because it understood that this money was intended to bail out YouthUprising,” the report said.
Gebhart did not respond to a list of requested questions about the grand jury report. Alameda County supervisors did not respond to requests for comment.
Simmons explained that she had previously borrowed money from the housing program bank account to cover expenses at Youth UpRising, so when she received the county bailout, she replaced those funds.
“It’s like if you took money from your light bill to pay your car note, when the money comes back in you have to clean everything. It’s inelegant, but it’s the truth,” she said.
She said Youth UpRising has addressed its financial issues and is back on solid footing.
Youth UpRising was founded in 1997 to address racial conflicts between black and Latino youths. City Councilman Larry Reid, who has been involved with the organization since the beginning and is a current board member, said his staff usually attended the meetings. He said he was not aware of the financial problems, and pledged to be more involved.
“It’s a nonprofit and like a lot of nonprofits, it tried to grow too fast,” Reid said. “But when history is written, it will show that it certainly made a difference in a lot of young people’s lives.”
The Alameda County supervisors and the county’s health care services agency have 60 to 90 days to respond to the grand jury report.
June 23, 2017
East Bay Times
By Tammerlin Drummond
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