Washington’s Commission on African American Affairs diverted public money for about six years to a nonprofit organization that spent much of it in ways considered inappropriate, according to a state audit released Thursday.
The audit report says former executive director of the commission Rosalund Jenkins entered an agreement with former commissioner Thelma Jackson’s nonprofit Northwest Institute for Leadership and Change in 2006 to manage all money donated to the commission. Those donations are considered public money even when managed by the nonprofit said Troy Niemeyer, the deputy director of state audit.
Through the agreement, the nonprofit spent $258,000 in “unsupported or unallowable” ways from December 2006 to February 2012. A total of $284,000 in donations were collected by the nonprofit on behalf of the commission.
“I don’t think it’s illegal to transfer the money, but the commission is still responsible for how the money is spent,” Niemeyer said.
The audit identified a number of specific improper activities by the nonprofit in that time period, such as spending $22,000 to provide transportation to public events and paying “private parties” $25 for each African American under age 25 they brought to events and an additional $20 for anyone else. Other things, like expensing food, did not have adequate documentation to prove they were for business purposes.
In a phone interview Thursday, Jenkins said she drew up the arrangement with state legal advice and said money was never donated to the commission, but to the nonprofit. She said she considered the donations to be private money.
The arrangement “was for the purpose of supporting the work of the commission that could not be done with public funds,” she added.
Jenkins said the arrangement was not secret, and cited a 2009 audit report that says the commission had “adequate” internal controls and complied with state laws and regulations in areas examined such as disbursements, which the new audit found violations with.
The results of the audit released Thursday left her “shocked and surprised,” and represented a reverse of what she had been previously told by state officials at the time, she said.
Niemeyer said he didn’t know what auditors believed at the time, but said it was “clear that the donations were intended for the commission.”
“If it’s intended for the use of the commission, it’s state money no matter which account it’s deposited into,” he added.
No evidence of fraud was found, according to Niemeyer.
The commission’s current executive director Ed Prince said all donated items now go into the commission’s state account and that their financial practices are “completely different now.” Prince was appointed to the position in late 2011, and the agreement with Jackson’s nonprofit was dissolved in early 2012.
“We instituted internal control over our finances to make sure something like that doesn’t occur again,” he said.
Jackson, the leader of the Northwest Institute for Leadership and Change, said she was unaware of any problems with the nonprofit’s work managing money for the state commission.
Jackson said at no time were funds diverted to her personally. Jackson, a former president of the board for North Thurston Public Schools, works frequently on statewide educational issues and is the board chairwoman of SOAR Academy in Tacoma.
“I have never been asked a single question by the Auditor’s Office about any of that to give me any indication there were any questions, or anything,” Jackson said.
Staff writer Melissa Santos contributed to this report.