BSO rethinks non-profit donation

The Bayanihan Student Organization was planning to cut a check for the La Causa Crisis Nursery and Respite Center this week, but said Wednesday they would hold off on sending the $4,070 they raised at their Nov. 21, 2003, Fall Fashion Show until they were sure the money would go where they wanted it to.

La Causa Inc. came under fire Jan. 21 when the Milwaukee County Department of Audits released an audit on one of its programs. It found problems with reported uses of funds, and demanded La Causa return $511,431 of county money.

La Causa is a non-profit organization working with under privileged children and families, has 14 different programs. The audit focused only on the Special Needs Child Care Program from the period between May 1, 2002, and July 31, 2003.

"Currently we're going to hold off on sending in the funds until we're assured the funds will go to the La Causa Crisis Nursery Center," said Jed Dulanas, one of the three BSO coordinators of the fund-raising event. Dulanas was a student in the College of Business Administration, but graduated in December.

The audit found two main areas, salaries and accruals, where the organization did not provide enough documentation for funds spent to meet the department's standards, according to Doug Jenkins, an auditor with the department.

Accruals, he said, are predictions for money to be spent paying outside contracts. Typically, these accruals are replaced with actual bills after the money is given to whom it was owed. However, two accruals in 2002 — totaling $150,000 — were never replaced with actual bills. The audit said the $150,000 was disallowed because "no documentation (was) provided," he said.

Several employees were being paid but did not have official documentation — such as timesheets — that they were working on the program, Jenkins said. He said the auditors interviewed the employees in question and determined they were not working on the program for the amount of time La Causa paid them.

In a memo to the department, La Causa said they conducted their own interviews and found the employees were working on the program every hour they were paid for. Jenkins acknowledged this information, "but that didn't jive with what we were told by those same people," he said.

Jenkins said there were other minor problems with documentation, leading to the demand to return the funds. Barbara Lucksinger, vice president of government and corporate relations for La Causa Inc., said the organization is disputing $147,461 of the funds demanded back.

"All of the money we're speaking about has been spent on the program," she said. "We came in under budget for both cycles. The issue is not about the program," it's about the system used for reporting expenditures.

Lucksinger said La Causa had a meeting with the Milwaukee County Health and Human Needs Committee to talk about the audit.

"It is the state's money," she said. "We needed more documentation. (But) we believe our documentation is appropriate and should be accepted. That's the dispute.

She said it was decided at the meeting to give La Causa "a few more months to iron out these disputes," but said it looks like they will have to pay the money back, "at this time."

Dulanas, reacting to the news of the audit, said after talking to members of the BSO, they would contact people at La Causa and make sure the money they raised goes to helping the children they intended to help when they chose the charity to receive the donation before sending the check.

Lucksinger said the BSO could be sure the money would help the nursery as long as they specified either in the memo section on the check itself or in a letter accompanying the check where they wanted the money to go.

The BSO chose the nursery because "it had a big need," Dulanas said. "We decided to help out with that." In an initial interview Wednesday, Dulanas said, "this is the first time I've heard of (the audit's findings). We'd never heard anything of the sort." He said the BSO does not regret its decision to raise the funds for La Causa, and will send the check shortly, after talking to their contact people at the organization.

"We're just trying to help people out," he said.

Pamela Larde, coordinator of student organizations, said La Causa was approved to receive donations, but the audit problems were not the university's responsibility to look into.

"Student organizations are independent," she said.

According to Ben Tracy, director of university communication, the only requirement for an organization to be approved for receiving funds is that it is a non-profit organization.