A nonprofit created by Mayor LaToya Cantrell froze its accounts after receiving a subpoena for financial records from the New Orleans Inspector General’s office, leaving several city-sponsored social programs dependent on of the organization’s funding in limbo.
Dana Henry, an attorney representing the Forward Together New Orleans board of directors, confirmed that the subpoena was served on September 8 and that the nonprofit has stopped using its operating account.
That means the nonprofit was unable to pay the bills for some of Cantrell’s prized social programs, including a final payment of around $5,000 to close out a program called Jumpstart that provided case management and training for 41 at-risk youth in New Orleans.
Gracefully Mindful Wellness Institute, which ran the Jumpstart program for the city’s Office of Gun Violence Prevention using FTNO money, sent a letter Sept. 12 telling the city it could no longer continue to operate. .
A second program called Learn and Earn that targets workforce development also failed to receive the first $75,000 that was to pay stipends to 100 laid-off workers being retrained through a federal grant.
Other city programs receiving money from the FTNO include the Gun Violence Crisis Response Team, which meets with shooting victims at the hospital in an attempt to stop the cycle of violence. This group is counting on $560,000 from the nonprofit as of January.
FTNO also promised to use a $500,000 Mayors Guaranteed Income Grant to pay 125 people $350 a month with no strings attached. City officials said the money has already been disbursed.
“If there is a private donor who has given money to FTNO to support programs, they are also not being paid now because everything is subject to a subpoena from the OIG,” said Henry.
Possibility of stopping
The programming break comes amid a dispute between board members and Shaun Randolph, the executive director they hired 11 months ago. And it comes after city council members questioned two contracts Cantrell signed in April to send nearly $1.1 million in city money to the nonprofit, also known as from the Mayor’s Fund and created in 2019 by Cantrell and Maggie Carroll, who led the mayoral re-election campaign.
Once the investigation is complete, FTNO could suffer the same fate as some of its programs. Volunteer board chair Kathleen Kennedy and treasurer Eric Griggs may not want to deal with the political fallout and could return the city’s money and shut down the nonprofit for good, said Henry.
“At the end of the day, they will have to decide if they go ahead with the legal dissolution of FTNO,” Henry said.
Kennedy waived an interview with WWL-TV last week and asked Henry questions. Griggs did not respond to requests for comment. A third board member, pollster Silas Lee, said he resigned from the board in July.
$3 million raised
It is not uncommon for nonprofit organizations aligned with the municipal government to help pay for the programs. Financial records show FTNO raised more than $3 million in private donations from 2020 to 2022 and used that money to help residents during the pandemic and to support some of Cantrell’s most ambitious programs.
But the Cantrell administration has also sent more than $1 million in city funds to the nonprofit, which serves as a fiscal agent for programs already run by the administration. Cantrell used one-year agreements with FTNO — which don’t need city council approval — to transfer about $850,000 from the Wisner Trust account and another $215,000 from the city’s general fund. FTNO earns an administrative fee between 5% and 8% for serving as the city’s tax agent.
Randolph, a Los Angeles native was hired as executive director of FTNO in November 2021, alleged that a majority of FTNO’s board members agreed to leave the board in July, but said reversed course in August to fire him in a move he called inappropriate.
Randolph further alleged in emails to City Council and the OIG that public money sent to FTNO was misspent. But Henry said all of the city’s $1 million in cash was still in the bank, untouched since Randolph deposited two checks from the city, one in May and the other in July.
About $430,000 in private funds also remain in the nonprofit’s operating account, according to figures provided by Henry.
Council President Helena Moreno questioned why the City Council was not notified of the city’s money being sent to Forward Together New Orleans.
“We weren’t getting any type of information from the mayor’s office about … why the money was being sent to the mayor’s nonprofit,” said Moreno, who along with council members JP Morrell and Eugene Green sponsored a resolution in April asking the city inspector general to investigate the association’s activities.
The inspector general “will want to know … where did that money come from, where did it go, and who was directing the spending of those funds,” said Matt Coman, a former federal prosecutor who reviewed public emails and records. of the FTNO. obtained through public records requests.
Inspector General Ed Michel declined to comment on an ongoing investigation.
Close ties to Cantrell
Although the nonprofit is not directly controlled by Cantrell, hundreds of emails reviewed by WWL-TV show the mayor, her campaign manager and several senior city hall officials helping FTNO raise donations. private and decide how it should spend the money.
For example, after Cantrell made the difficult decision to cancel Mardi Gras parades in 2021 due to the pandemic, she told her staff in an email that she wanted to issue proclamations to Indian leaders on Mardi. Gras to thank them for their leadership. In the same email, Cantrell asked FTNO’s then director, his former political director Trent Butler, to use FTNO funds to pay the chiefs $500 each.
“Do we have any FTNO checks we can cut for support, $500 each (?) No pressure, let me know. It may be housing costs,” Cantrell wrote.
Asked about the mayor suggesting the support payments be labeled as “housing expenses,” Cantrell communications director Gregory Joseph said that makes sense because the nonprofit already supports some housing programs. housing assistance.
“It’s a grant, so you can put it under anything,” he said.
Joseph also defended the work of city employees on behalf of FTNO. He said the nonprofit, with no full-time staff, was called into action soon after its founding to provide essential aid to those in need during the Covid-19 shutdown.
He said critics can quibble with employees using their city’s email to craft proposals or collect donations for the nonprofit, but that’s often the most effective way to help people. desperate. For example, Cantrell’s deputy, Emily Wolff, used her city’s email in 2020 to send an FTNO invoice to United Health Care to collect a $25,000 donation. Joseph said he paid 250,000 diapers and baby food to needy families.
“Isn’t that what the Director of Youth and Family should do? said Joseph.
Carroll, Cantrell’s campaign manager, was regularly involved in FTNO’s board meetings and financial decisions in 2020 and 2021, records show. She used an FTNO email address as recently as last month and received bank notifications for the nonprofit until Randolph changed that in February.
Carroll said it was partly his idea in the first place to create a mayor’s fund that would help Cantrell and all future New Orleans mayors, based on models already used in Philadelphia and New York.
She said she never had an official role with the nonprofit after its inception, but stepped in to help until Randolph was hired because he was ” all on deck” during the pandemic.
“I was thrilled when they hired a general manager because we knew the organization needed strong leadership and I felt the organization was in good hands,” she said. “My advice was no longer needed. I was not aware of any issues the organization had with the Executive Director or concerns he shared with them.
Randolph said he began to worry about FTNO’s finances and operations in May, when the city’s first check for the Learn and Earn program, in the amount of $505,310.40, was sent. by mail to the St. Charles Avenue mansion of Cantrell’s inaugural fund president. The city said it was a simple clerical error: The inaugural fund was also called “Forward Together New Orleans” and the city’s purchasing office sent the check to the wrong FTNO address.
After that, Randolph said he tried to “clean house” by hiring a New York attorney to help him revise the bylaws and recruit new board members, but the board current dismissed his concerns.
“I felt like if I didn’t talk, people might start pointing at me and saying, ‘Oh, you’re one of them too. I wanted to be very clear in speaking, I have nothing to do with it,” Randolph said.