Friday, April 09, 2004
Copyright © Las Vegas Review-Journal

ECONOMIC OPPORTUNITY BOARD: Nonprofit spent thousands on trip

Organization under scrutiny for inability to account for $2.1 million

The financially troubled Economic Opportunity Board paid tens of thousands of dollars to send 10 people on a five-day trip to Puerto Rico last year, documents obtained by the Review-Journal show.

The county's largest nonprofit organization, which is under investigation by federal and local agencies, spent about $30,000 for travel, accommodations and per diem allowances for the December trip, a source close to the inquiries said Thursday.

The money used to pay for the trip was taken from a portion of state funds intended for a different program, the source said.

The organization, charged with helping the valley's poorest residents, has been unable to account for $2.1 million in state funds that were meant to bolster its child care subsidy program.

Financial discrepancies in the group's Head Start and Early Head Start programs also have prompted federal scrutiny.

The Head Start programs help prepare children of low-income families for their first years of school.

Documents show 10 people, including one administrator, five staff members and four parents involved in the Head Start program, went to San Juan, Puerto Rico, to attend the 20th Annual Parent Training Conference, which was held from Dec. 11 to Dec. 16.

The group stayed at the Courtyard by Marriott San Juan Isla Verde Hotel. Each person had their own room at a cost of $241.90 per night, for a total hotel bill of $12,095, documents show.

Literature on the Web site for the National Head Start Association, which sponsored the event, recommended more affordable rooms, such as the Hampton Inn Suites at $149 per night.

Windy Hill, assistant commissioner for the Head Start Bureau in Washington, D.C., said Wednesday that she would inquire about the trip.

But the source said funding for the trip had not been included in the Head Start program's federal grant. The board received about $12.2 million this year for its Head Start programs.

"In September, Head Start was already overspent in its grant," the source said. "There were checks in the checkbook, but there was no money in the account. They (administrators) kept using encumbered funds."

Encumbered funds are set aside for specific purchases or programs.

The source said administrators borrowed money from the organization's child care assistance program to cover Head Start expenses and planned to repay the program with anticipated future grants. But the grants came in late, causing budget shortfalls in Head Start.

The source said all of the organization's funds, including restricted federal grants, are commingled in a single account, and administrators track expenditures through coded bookkeeping entries. The source said the system is too antiquated for an agency with a total annual budget of about $50 million.

As early as May 2003, the organization's balance sheet already showed "negative cash on hand of $2,317,994.04," according to a federal audit. The audit also said "the agency did not have a written cost allocation plan, and staff was unable to justify or support the current allocation."

Board officials and staff since then have written corrective action plans. But the board still is at risk of losing all of its Head Start funding if federal investigators find the problems have not been corrected.

Board members in January changed policies to require that all travel requests be budgeted and subject to board approval. They were not consulted about the trip to Puerto Rico.

The trip was approved by Head Start Administrator Diana Goff, administrator Diba Azizi Hadi and Executive Director Marcia Rose Walker, documents show. Walker resigned in March.

The funding request was approved just three weeks before the trip and was stamped "RUSH" four times.

Goff led the trip, and was joined by staff members Hilda Vega, Racquel Bonisgnore, Sheila Byrd, Rory Sipp and Maria Martinez, documents show. The parents who traveled were Pamela Henry, Tiffini Perez, Andre Harley and Henry Veley, documents show.

"At the time, such a trip could be approved within the administration without going before the board because the Head Start grant includes some funding every year for training and travel," said board member Chester Richardson.

Still, he called the trip "extremely excessive."

"The decision to send that many staff to a training of that nature should have been re-examined," Richardson said.

State Sen. Joe Neal, D-North Las Vegas, the board's spokesman, said the agency has halted all travel, except trips required by governmental funding sources, in response to the ongoing investigations.