Nonprofit Caring for Denver responds after city audit claims misuse of taxpayer dollars

A Denver organization that invests in the community is now in the spotlight for its spending habits. The Denver city auditor has raised concerns about spending after reviewing more than 700 expense reports for Caring for Denver.

"We were created out of a sales tax initiative to address mental health and substance issue needs in the City and County of Denver," said Lorez Meinhold, Executive Director, Caring for Denver.

The nonprofit uses a majority of those taxpayer dollars to provide grants to organizations that support mental health and substance misuse prevention. Nearly a decade ago, voters increased the sales tax to create the Caring for Denver Foundation, which has awarded more than $185 million in grants to nearly 300 organizations. 

However, a recent audit by the city of Denver now claims some of the nonprofit's dollars are going to meal reimbursements.

"We found staff expenditures for things like meals and alcohol that appeared to me to be excessive," said city auditor Timothy M. O'Brien.

The city auditor states that Caring for Denver Foundation executives and staff regularly paid for meals and alcohol with taxpayer funds. The auditor looked at 734 expense reports and found 598 released to meals reimbursements, 200 meals reimbursed to the executive, 75 of which included over $3,000 on alcohol.

However, Minehold says that money was spent on business meetings with community members such as grantees and prospective grant recipients.

"We don't want that meeting to ever be limited by how many resources an organization has. So, we have a policy if we're meeting with somebody, we pay for it," said Meinhold. "A majority of these meetings are actually over coffee, not meals, not alcohol."

The auditor's findings also raise concerns about grants being awarded for things like self-care and quarterly retreats for grantee staff, which they say are grants that did not align with the foundation's ordinance.

Minehold says these grants do serve a purpose.

"Capacity building grants are a best practice, and it helps organizations achieve their mission of mental health and substance misuse," said Minehold.

The auditor also claims grants were awarded to incomplete applicants.

"We found the process to decide who they were going to grant money to needed a lot more documentation, needed a lot more policies, a lot more structure around it," said O'Brien.

Meinhold recognizes they can do an even better job of documenting grant applications, itemizing expenses, and making changes to build trust.

"We're stewards of public dollars, and we recognize that," said Minehold.

While Minehold says they do not agree completely with every recommendation made in the city's audit, which can be found on the City of Denver's website, she says they have been working with the auditor's office to adhere to many of the recommendations made.

"We'll stop allowing the reimbursement for alcohol moving forward," she said. "We're sorry that trust has been eroded. We again take this very seriously. It has never been a significant amount of what we spend on administrative, but we know that the conflict it creates... creates distrust, and because of that, we will be changing our policy not to include alcohol anymore."