Truck muck: Citizens Alliance For Better Neighborhoods has spent hundreds of thousands of dollars on trucks and other equipment.
photo: Shoshanna Wiesner
April 13–20, 2000
city beat
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Truck muck: Citizens Alliance For Better Neighborhoods has spent hundreds of thousands of dollars on trucks and other equipment. photo: Shoshanna Wiesner |
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by Noel Weyrich
Hours before the state was to file a breach of contract lawsuit against it, the Citizens Alliance for Better Neighborhoods last Friday filed two long-overdue audits on $555,000 worth of state grants the organization received more than two years ago.
The audits, which will not become public until they pass muster with state auditors, presumably offer details about how two state Community Revitalization Program grants (one for $500,000 and one for $55,000) were spent by the secretive South Philly-based nonprofit.
A spokesperson for the state Department of Community and Economic Development cautioned, however, that the agency is still withholding a $500,000 grant check owed to Citizens Alliance since May 1999. The state has held up payment because of Citizens Alliance’s tardy audits.
"That money has not gone out the door yet," says Megan Neuhard, a department spokesperson. "We’re reviewing the audits, and if they’re in compliance, we’re good. If not, we have to take it to the next step." Auditors may request more details if the audits are deemed inadequate.
Citizens Alliance hand-delivered the audits, each of which was more than a year overdue, early last Friday morning. Later that day, at 2 p.m., attorneys for the department filed lawsuits against 16 other nonprofits that owe audits on Community Revitalization Program grants, including at least five groups in Philadelphia. Most of the 16 grants to these groups, however, were for $20,000 or less, and the largest was for only $40,000. Added together, they totaled $280,000, just over half what Citizens Alliance had gotten in its two grants.
The organization was founded in 1991 by City Councilman Frank DiCicco. Besides DiCicco, two of its three board members are employees of State Sen. Vince Fumo, DiCicco’s political mentor. DiCicco recently claimed that he has resigned as president of Citizens Alliance, but added that he is unable to name the current head of the organization.
"Because of the dollar amounts we’re talking about, [Citizens Alliance’s] need to be real audits that are fairly in-depth, and my understanding is that they are," says Neuhard. "We need proof of where the money went." Calls to DiCicco’s City Hall office and to the Citizens Alliance office were not returned.
According to his March 13, 1997, application for the $500,000 grant, DiCicco described the purpose of Citizens Alliance as "enhanc[ing] the public health, sanitation and the general quality of life in selected areas of the City of Philadelphia." The funds, he said, would "help undertake periodic street sweeping, snow removal and other public health and sanitation services." DiCicco expected to pay $50,000 to $60,000 in "administrative costs," $50,000 to purchase and maintain "anti-graffiti machines and paint," and a combined $150,000 for "misc. other equipment" and for "community improvement projects to enhance quality of life."
When they are made public, the audits may clear up some of the nagging questions about the operations of Citizens Alliance, which has benefited from more Community Revitalization Program dollars than just about any other nonprofit in the state.
According to the Citizens Alliance’s subsequent tax filing for 1998, which covered the year in which the CRP grants were to be expended, the organization reported $427,845 in program service expenses. Among the expenditures listed were such vague entries as $76,859 for "outside help" and $127,783 for "community distributions."
Additionally, Citizens Alliance paid board member and secretary Ruth Arnao $18,000 in "compensation" in 1998, without specifying her hours worked. Yet the nonprofit’s IRS filing states that Citizens Alliance paid no payroll taxes on either Arnao’s compensation or on any of the nearly $77,000 spent on "outside help." Arnao is a $69,035-per-year aide to State Sen. Vince Fumo, and the tax filings were prepared by Drucker & Scacetti, an accounting firm in which Sen. Fumo’s wife is a partner. A call to Arnao was unreturned.
"If they have employees, they are required to withhold income tax and payroll tax, and issue W-2 forms," says IRS spokesperson Kevin McCann.
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House of secrets: Citizens Alliance has been slow to show where it spent state money photo: Shoshanna Wiesner |
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After years of obtaining nearly all of its funding in grants from state agencies such as the Community Revitalization Program, Citizens Alliance received $1 million in private gifts from undisclosed sources in 1998. It began 1999 with $526,436 in the bank, according to its 1998 tax filing.
Recently obtained state records show that last year Citizens Alliance filed for a change in its mission statement to include "the acquisition of real estate and equipment to be used in the provision of housing, the provision of educational facilities or to be used directly in the furnishing of services." DiCicco signed the document on May 17, 1999.
Within the next several months, the organization bought at least four properties costing a total of $1.6 million, including a one-acre parcel of open land in the 2600 block of South 13th (purchased from PECO Energy for $177,152), a school at 914 Christian St. (from the Roman Catholic Archdiocese of Philadelphia, for $800,000) and two properties in Northern Liberties, including the James Door Check industrial building (for $600,000).
The Christian Street property is now home to the Christopher Columbus Charter School, of which Sen. Fumo is a founding board member, while the James Door Check building has been touted in Fumo’s State Senate constituent newsletter as the site of a prospective business incubator for small high-tech start-up companies.
It is anyone’s guess what Citizens Alliance intends to do with an acre of open land in South Philly.
