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Goldstein Investigation: Some Agencies That Help The Homeless With Taxpayer Money Aren't Eligible -- But Get It Anyway

LOS ANGELES (CBSLA) -- The public agency that is charged with helping the homeless has been giving millions of dollars to organizations that, by law, are not eligible to receive it.

How is that happening? David Goldstein investigates.

The how is a question he posed to Peter Lynn.

He runs the agency responsible for helping the county's growing homeless problem by doling out millions of taxpayer dollars.

But his investigation found some of the non-profits that received a portion of that money this fiscal year, weren't even eligible to get it. And Lynn didn't know until Goldstein told him.

"You asked questions, it's helpful when you ask questions because it brought that to our attention," Lynn said.

Lynn heads up the LA Homeless Services Authority or LAHSA -- a combined city and county agency. It's responsible in part for administering some of the money from Measure H which was approved by voters in 2017. It added a quarter-cent increase to the LA County sales tax that's being used to prevent and combat homelessness.

Goldstein went through the money that LAHSA funded to non-profile organizations in this fiscal year and found more than $11.5 million going to five organizations that were delinquent with the Attorney General's office.

That means it was illegal for them to have gotten the money.

Goldstein asked a chair of a citizens' budget oversight committee if these non-profits should have received the cash?

"Absolutely not," says Jay Handal. He's the chair of the committee. He examines tax dollar spending the homeless and other services in Los Angeles.

"You've got organizations that are taking taxpayer dollars that are not complying with the law," says Handal.

Goldstein found some of the non-profits have been delinquent for years.

"Doesn't surprise me," says Handel, "There's no oversight."

The law requires non-profits to be compliant with the California Attorney General's registry of charitable trusts -- which monitors charities for the state.

And LAHSA's own guidelines say qualified bidders have to comply with statutory obligations.

But Goldstein found Harbor Interfaith Services -- which has already received part of more than $6.5 million in Measure H money, delinquent with the Attorney General's office.

In fact, the organization was sent a letter from the AG in March of last year announcing an incomplete annual registration report from 2016.

Harbor claims it was a clerical error on the part of the Attorney General's office. But AG sources confirm they were delinquent.

Goldstein also found -- Sanctuary of Hope, United Friends of the Children, Testimonial Community Love Center and Los Angeles House of Ruth -- delinquent with the AG for annual incomplete reporting.

We're not saying that any of these organizations misused any money -- what Goldstein is pointing out is that they're not complying with the filing requirements of the Attorney General's office and yet received millions in your taxpayer money.

"So how does your agency give millions of dollars to organizations that are delinquent and, by law, not eligible to receive money? Goldstein asked Lynn.

"So these organizations are required to make their filing," Lynn said.

"And they didn't," Goldstein says.

"Keep themselves current," Lynn says.

"And they didn't," Goldstein says.

"And we're following up to make sure they get themselves current," Lynn says.

:Mel Tillekeraine is co-founder of the Shower of Hope -- a non-profit that is in good standing with the Attorney General's office and is funded through LAHSA.

They provide mobile showers to 11 locations around the county.

He says his non-profit and others like it owe it to the taxpayers and the homeless to stay current with the Attorney General's registry.

"There's a lot of people suffering," he says, "so the only way to have that accountability is being registered and making sure that everything we do is reported."

And even after Goldstein pointed out the problems -- LAHSA's director says they don't plan to halt funding for agencies that are delinquent.

"We want to make sure that they continue the work uninterrupted without you know a paperwork issue tripping them up," Lynn says.

After Goldstein started asking questions, four of the five non-profits mentioned were able to get their registration compliant with the Attorney General. Only Los Angeles House Of Ruth is still delinquent. They claim it could take two weeks to update -- still the questions remain. How these organizations are being vetted before receiving taxpayer money.


Tahia Hayslet, executive director of Harbor Interfaith Services, issued the following statement:

We assume that a clerical error within the Attorney General's office resulted in a report that Harbor Interfaith Services, Inc. was delinquent in its 2016 Annual Registration Renewal Fee Report. We filed a complete 2016 report with the Attorney General in 2017. This filing was brought to the attention of the Attorney General on February 1, 2019, and later the same day we received an email from that office stating, 'Good news...we received all the required documents and the organization is now Current with our office.'"
We appreciate your inquiry into this matter before running what otherwise would have been an erroneous story. Please do not hesitate to contact us should you have additional questions.

Editor's Note: Sources at the Attorney General's office say it was not a clerical error and the organization was delinquent.

Jennifer Gaeta, executive director of the Los Angeles House of Ruth, issued the following statement:

As of Friday all three years were submitted.
I spoke with the office staff of Registry of Charitable Trusts, it can take 2 weeks for the posting to be updated.
The explanation is simple yet truthful.
We changed auditors and this report had always been done by outside auditing firm.For each year of 2016, 2017, 2018 we had an Extension from the IRS for submission of the 990. Therefore, 2018 is not delinquent as the IRS extension overrides the date of submission of the Registry of Charitable Trusts. This is on their website under due dates and exclusions.

As of today we had not received any notification of the delinquency from the Office of Charitable Trusts.
This omission was not noted by our staff, that is our responsibility yet had been a duty performed by our outside auditor so was easily missed as not on our internal list of items to ensure being completed.

We have been in existence for over 40 years and this has to have been the first omission in this area.
Hearing from you was the alert that caused me to investigate and correct the error.
I realize you are protecting the public trust in exposing fraud, but we are not that.
I am sure there is fraud, but 99.99 percent of service providers are extremely truthful, honest and dedicated.
Our reward comes from having the ability to provide such needed service.

Kara Allen, president and CEO of United Friends of the Children issued the following statement:

According to the California Office of the Attorney General, United Friends of the Children is current with all required filings and is therefore in full compliance with the Registry of Charitable Trusts.

Editor's Note: They became compliant after Goldstein started asking questions.

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