Opportunity knocked

The Economic Opportunity Board's financial crisis could strain social service caseloads

By Larry Wills

The news of the local Economic Opportunity Board's mismanagement of millions of dollars to help the poor has reverberated through other Southern Nevada agencies like a thunderclap.

It couldn't have come at a worse time. EOB and other nonprofits are groaning under skyrocketing caseloads and skimpy funding. And now the future of some programs is uncertain.

"The resources are getting tighter and the need is so much greater," Salvation Army Major William Raihl says. "It's a struggle to keep up with present needs. I'm fearing we'll get to a Band-Aid effect, only putting off a catastrophe."

Earlier this month, EOB was the target of investigations into how $2.1 million meant to subsidize day care for low-income families ended up in the agency's general fund and then disappeared. Four top administrators left their jobs and EOB is now trying to repay the money to the state Welfare Division to the tune of $300,000 a month.

State Sen. Joe Neal, D-North Las Vegas, EOB's spokesman, said at a press conference that the money had been "mishandled." Then he told reporters, "No services were in jeopardy." After the conference ended, however, Neal didn't seem so sure, saying, "I hope no services are in jeopardy."

Facing a less-than-sympathetic audience, Neal blamed "factionalism on the board" at EOB and a lack of candor by the administration for a host of problems that led to the investigations. "We were told the agency was making money, but it wasn't making money," he said.

The day care shortfall isn't the only headache EOB is facing. Separate investigations by United Way and the Head Start Bureau are looking at other possible financial discrepancies.

As Neal listed planned austerity measures to repair EOB's finances and called the problems "procedural," others weren't as optimistic. One worker worried the agency might shut down entirely, placing services to 56,000 Southern Nevada residents in doubt.

The state Welfare Division allayed those fears two weeks ago when it pledged nearly $10 million to the child care program through the end of the year. But EOB's role is still uncertain, since the state's contract will be reviewed June 30. One proposal would separate the services from financial oversight.

Whoever administers that program will be taking on an exploding caseload. EOB's latest figures show the number of day care subsidy recipients doubled from 2001 to 2002, from 5,788 to 11,912. Under that program, families are permitted to choose their day care provider, which receives the subsidy from EOB. Day care subsidies have been touted as integral to keeping working families off welfare.

The figures also don't include families receiving multiple services, which can be up to many times higher. For example, the Head Start program in 2002 lists 2,180 families that receive 301,000 various services, such as health care, housing and transportation.

The fate of EOB's programs may hinge on the results of the investigations, expected to be released by the end of the month. But the alternatives are unclear.

Catholic Charities is already overloaded with low-income needs. "We are very, very busy," says Sharon Mann, community relations manager for the agency. "In social services alone, we see 150 to 200 families a day." Catholic Charities runs 19 different programs for the indigent and the homeless, and serves 1,700 meals a day.

And the numbers are being squeezed. "Over the holidays, we saw a 10 percent decrease in donations and a 40 percent increase in caseloads," Mann says. Recent layoffs at Binion's Horseshoe and the Castaways brought even more people in for assistance. "We were helping those people with food, etc. Our pantry is diminishing."

Raihl sees a similar situation at the Salvation Army, which serves 5 percent of the Southern Nevada population in one way or another. In one division alone, the number of families needing help doubled over last year. "We are at capacity," he says. "We're seeing 500 new homeless people every month."

Raihl and Monsignor Patrick Leary, head of Catholic Charities, say they could take up any slack if EOB lost programs, assuming they get more money. "We will do anything we can," Leary says.

But Raihl says a better answer is for EOB to heal itself. "I don't wish any other agency ill will. They're an important piece for the needy in this community."

Neal hopes to keep it that way. "This agency is more than 40 years old. It has served millions of clients." He says the investigation showed that, despite a host of financial problems, the agency provides a high quality of service to its clients. "EOB is the only thing going on in this county that is meeting the needs of poverty-stricken people."

Indeed, EOB operates 30 programs, with an annual budget of nearly $50 million, serving the needs of children, families and seniors. As the largest nonprofit social service agency in the state, it struggles with helping as many of the estimated 170,000 people--including 75,000 children--below the poverty level in Clark County as its budget will allow. But about two-thirds of the poor do not receive EOB's help in any form. The services provided range from Women Infants and Children clinics, to VISTA, health care and transportation for the handicapped. About 500 people help administer these programs.

But EOB has faced intense scrutiny from the local media, questioning whether $12 million in federal Head Start funds were properly spent, the use of an EOB kitchen by a board member under contract to provide meals to county jail prisoners and executive wages that exceeded $80,000. Neal, at the press conference, was forced to defend a junket to Puerto Rico by Head Start board members, which he said was paid for and mandated by the federal agency. Other questions nag EOB, such as the $50,000-a-month rent for its headquarters at Rancho Drive and Gowan Road. The Las Vegas Review-Journal filed a complaint with the state attorney general, protesting a secret EOB board meeting. The R-J quoted former EOB board member Amanda Cyphers, in her dire assessment of the agency: "Maybe we need to pull the plug on life support, let the house continue to burn and rebuild it, because it's not salvageable under this same group."

All this could spell bad news for EOB and the 56,000 clients it serves. At best, it could interrupt services. At worst, some services could end altogether. And all the while, employees are coping with larger caseloads and a crisis in workplace morale.

"They've had such a tremendous growth," Raihl says. "We're hoping they can right the ship. We need them."