Pervasive Non Profit Abuses

[From article]
Rapfogel epitomizes the cozy relationship between politics and social-services contractors in New York. His wife, Judy, is chief of staff for New York State Assembly Speaker Sheldon Silver, perhaps the state’s most powerful politician. Silver derives significant influence from his control of earmarks—grants that Albany legislators confer on New York nonprofits every year. These awards, subject to few external controls, get made outside the normal state contracting process, often at an individual legislator’s discretion. Conflicts of interest are rampant. As Newsday recently reported, Judy Rapfogel annually sat in on the meetings during which assembly members decided which groups they would fund. She was present when her husband’s organization won millions in direct grants.
[. . .]
in fiscal 2011, the network of organizations under the Metropolitan Council’s umbrella brought in a staggering $110 million in income, $90 million of it coming from government sources.
[. . .]
The disease of nonprofit corruption infects local government in New York, too.
[. . .]
In 2010, the Daily News revealed that city investigators had discovered that Ridgewood Bushwick’s executive director, who was also Lopez’s campaign treasurer, was making $782,000 annually, a sum grossly out of line with compensation standards for city-funded nonprofits. Ridgewood Bushwick also employed Lopez’s longtime female companion as its director of housing services, at $343,000 annually. Under media pressure, the city temporarily suspended more than $25 million in contracts with the group, until it fired its director and replaced its board.
[. . .]
Without a firewall between state elected officials and those who receive state funding, the opportunities for wasting taxpayer dollars are just too great.
Over the years, simply imprisoning those caught with their hands in the till hasn’t stemmed the corruption. Eliminating the conflicts of interest and curtailing the money at its source seem the only ways to change New York’s culture of nonprofit corruption.

http://www.city-journal.org/2014/24_1_snd-nonprofit-corruption.html

STEVEN MALANGA
Follow the Money
New York needs a new solution to its problem of nonprofit corruption.
Winter 2014
City Journal