Government & Politics

Obscure Missouri tax is meant to help kids. Whistleblower has concerns in one county

Illegal conflicts of interest. Questionable uses of taxpayer funds. Lack of financial accountability.

Those are among the allegations that have Missouri State Auditor Nicole Galloway reviewing an obscure taxpayer-supported agency that provides counseling and other mental health services for kids who live about an hour’s drive east of Kansas City.

Galloway’s office won’t say who brought forward those concerns about the Lafayette County Children’s Services Fund last month. Nor will it discuss the case in any detail other than to say it arose as a result of a whistleblower’s complaint.

But it’s no secret in Lafayette County that the children’s services fund has had a tumultuous couple of years — sparking rumors in Lexington, Odessa and Higginsville about the fund, a program it financed called Brighter Futures and gossip about unfair favoritism when it came to distributing tax dollars.

“All I know is speculation,” said Republican county commissioner Craig Williams, who is the commission’s liaison to the children’s services board.

Likewise, Jack Bainbridge, chairman of the county’s Democratic Party central committee, has no inside information. But as a keen observer of the local political scene, he has his suspicions.

“If it has a smell, it’s either pleasant or it stinks,” Bainbridge said. “I have a sneaky feeling that it’s going to stink a bit.”

The Star learned the nature of some of the whistleblower’s complaints from sources outside the auditor’s office, which were supported by public documents. No criminality has been alleged. But concerns about whether the funds were being spent wisely raise questions about whether the fund was helping as many kids as it could.

They are the kinds of issues that sometimes arise when little-known, tax-funded agencies operate in the shadows with little to no governmental oversight.

The Lafayette County Children’s Services Fund is the smallest member of a small club. Since 2004, voters in nine of Missouri’s 114 counties have approved special sales tax issues that subsidize a narrow list of social services for youths up to their 19th birthday. Jackson and Clay counties were the latest to pass children’s services taxes, in 2016 and 2017, respectively.

The city of St. Louis also has a property tax dedicated to providing the same services as set out in the state statutes that allow for the creation of children’s services funds.

The money can be used to provide temporary shelter for youths who have been abused, or are neglected, homeless, runaway or emotionally disturbed. It can pay for counseling and psychiatric services to kids whose families can’t afford it, as well as aid to unwed mothers.

Whereas Jackson County’s children’s services tax collects $13 million annually, Lafayette County’s one-eighth of a cent sales tax has pulled in about $300,000 or more each year since voters passed it in the spring of 2005.

Decisions on how to spend that money are the responsibility of a nine-person board that is appointed by the county commission, but the commission has no veto power.

The board’s meetings are open to the public. Minutes are kept and posted online. But other than the agencies seeking grant money, no one else pays much notice.

Until 2016, the Lafayette County Children’s Services Fund was an all-volunteer operation. It had no paid staff to vet applicants seeking money for their projects, or to track how the money was spent after the checks were written. Some remain concerned about that, even after two women were hired in succession to take on that task.

“No accountability”

Notably, the children’s services fund has spent up to a quarter-million dollars some years on contracts for therapy and counseling services for kids. Yet not until 2017 were recipients required to provide detailed documentation showing how that money was being spent.

Some past children’s services board members had complained about it repeatedly and at least one of them resigned in frustration.

Mike Robinson, an Olathe-based consultant to non-profit groups, had the same concerns when he studied the organization last summer at the request of the most recent executive director, who resigned last month. The board is now looking for her replacement.

“There was no accountability,” Robinson said. “Nobody knew or was willing to say where the money went.”

Also, some funding decisions appear to have violated state law. Last spring, the children’s services board gave a church-affiliated non-profit group, the Community Christian Center of Wellington, Missouri, $15,000 for a summer lunch program — which is not one of the purposes for which children’s services funds were created.

The program was aimed at kids who normally eat lunch for free or at a reduced rate during the school year, but weren’t assured of having a nutritious lunch during summer vacation.

The board’s minutes do not reflect whether anyone questioned whether that kind of expenditure was allowable under the state statute.

It doesn’t appear to be. But it passed unanimously at the request of the long-time county clerk and others affiliated with the Community Christian Center.

The services fund did not get a progress report on that Lunch Buddies program until September, showing that only a third of the money had been spent on providing sandwiches and snacks for far fewer children than had been anticipated.

But rather than return the money, the group wants to continue the program during the school year.

Children’s Service Board Chairwoman Tahnami Gittinger declined to comment on whether that will be allowed.

The fund also appears to be in violation of another provision of the state law that allows voters to set up children’s services funds. Three of its current members shouldn’t be on the nine-member board, because the law prohibits members from serving if they are employed by or on the governing bodies of organizations that receive grant money from the fund.

Two of them are teachers with school districts that receive money from the fund, and Gittinger is vice president of the Odessa school board, which also receives funds.

As the county commission’s liaison to the board, Williams appointed all three of them. When asked to comment about that last week, he declined.

Until mid-2017, half or more of the grant money the board approved annually went to pay for a program called Brighter Futures that was set up more than a decade ago by the county’s six public school districts to meet the mental health needs of their students.

The Lexington R-V District took on the job of disbursing the program’s annual allocation on behalf of all the districts to pay for therapists to work with students individually and in groups for things like anger management, grief counseling and pervasive developmental disorder. Later, the district headquartered in Higginsville, Lafayette County C-1, took on the check-writing role.

The districts had for years heralded the program as a big success and provided the children’s service fund with progress reports, but there wasn’t much detail on how the money was being spent.

Brighter Futures said it used the children’s services tax money to pay for parenting classes and other programs aimed at kids and their families. Each district assigned staff to the project, but much of the work was hired out.

A lot of that went to a single private business, rather than a non-profit agency, which is the case in most other children’s services funds. Partly that was because The Center for Counseling & Training (CCT) in Lexington was the only locally based provider of those services.

While it wasn’t her only income stream, it was an important one to CCT’s owner Theresa Dotson Alexander. In a 2017 letter to the children service’s fund, she said the money from Brighter Futures helped grow her business from a one-woman shop to a staff of eight therapists, including herself.

She made that observation as the children’s services fund was deciding that, after nine years of supporting the program, it was time to break ties with Brighter Futures. When the breech was finalized, Alexander criticized the move in a 1,400-word Facebook post.

“There is absolutely no legitimate reason, as far as I have researched, for the LCCSF to have pulled funding for Brighter Futures direct service from our kids,” the July 21, 2017 Facebook post read. “There is absolutely no reason for the LCCSF to have taken 40 clients away from my local business.”

Improper arrangement

The children’s services board felt otherwise, having discovered that the arrangement had been improper from the start. Brighter Futures didn’t exist as a legal entity.

It wasn’t a charity and it wasn’t a governmental body, the only two kinds of recipients that a state statute said were eligible to get tax money from a children’s services fund.

Board members had also grown tired of Brighter Future’s failure to provide the kind of detail they wanted showing how the money was being spent.

Russell Kruse, a circuit court judge in Lafayette County, was on the board then. He recalled last week in an interview that the lack of accountability troubled him.

“It needed to be, in my opinion, a separate entity, a charitable entity, something like that and it wasn’t,” Kruse said. “It was just part of the schools, and if that is the case, I had some concerns ...I don’t want it to be a slush fund for the public schools.”

Aaron Knipmeyer at the Higginsville school district denies there was any reason for concern and chalks up the breakup with the children’s services fund to philosophical differences.

He says Galloway won’t find that Brighter Futures misused public money, should she undertake an audit.

“If you are doing everything right, you’ve got nothing to hide,” he said. Knipmeyer’s wife works at Alexander’s clinic.

The board’s focus on greater accountability from the agencies it funded began about the time the children’s services fund board hired Tiffany Harbour as its executive director in the fall of 2016. One of her jobs was to set up strict procedures that grant applicants had to follow.

“She was putting that leg work out that we weren’t able to do and start asking each person who received money, how are you using this, where is it going?” Kruse said.

Harbour declined to comment for this story.

But records show it was she who stressed that Brighter Futures be defunded and voiced her objections when Williams appointed Alexander’s husband to the board after the funding that fed her business was cut. That money, instead, was shifted to a non-profit health organization that furnished counselors to all the school districts.

Brian Alexander was often critical of the new provider’s work during his year on the board. He resigned late last year after voting with the others to restore some direct funding to the school districts again. That allowed children’s services fund money to once again flow indirectly to his wife’s business, Alexander told The Star, and thought it would be a conflict of interest if he stayed on while she was cashing those checks.

Theresa Dotson Alexander stresses that her support of the Brighter Futures program has nothing to do with the money.

“I’m very passionate about it,” she said. “I think it’s one of the most innovative programs out there.”

Last spring, Harbour suggested that Robinson provide board members with training about grant applications and how best to comply with the laws governing the fund.

Concerned with some of what he saw, he suggested the board hire someone to conduct a full forensic audit.

When that didn’t happen, he stepped away in August. Harbour quit soon after.

Robinson said he can’t understand why some board members were seemingly reluctant to take a deep and hard look at their operation. But he suspects Galloway will find out, if she proceeds beyond her initial investigation to see whether a full audit is merited.

“I have been doing this for 40-some years,” Robinson said, “and every time you find this lack of accountability to this degree, you have to assume it’s intentional. What is going on that they don’t want to be discovered?”

Mike Hendricks is a member of The Star’s investigations and watchdog reporting team. Send tips and story ideas in confidence by email to mhendricks@kcstar.com, Twitter direct message @kcmikehendricks, or anonymously via Signal encrypted message at 816-234-4738
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