More DHS work goes to nonprofit

Street has begun shifting $40 million in duties to an agency with ties to his wife.

Posted: June 17, 2007

With the competency of Philadelphia's Department of Human Services in doubt after the deaths of children in its care, Mayor Street has been quietly working to transfer $40 million worth of youth-prevention services out of the city's hands and into those of a nonprofit agency with ties to his wife, a longtime children's advocate.

The money means the nonprofit, Philadelphia Safe and Sound, will likely operate with a $70 million budget as of July 1 - twice what the budget was two years ago. Street's wife, Naomi Post, was director of the nonprofit until 2002 but no longer has a formal role.

Several recent e-mails between Post and Safe and Sound board members have surfaced in recent days, revealing Post's familiarity with the influx of money to the nonprofit, but Post said she had not influenced her husband's decision to shift the programs.

The change may mean more tax money will be allocated - and spending decisions made - without the same public scrutiny required of city departments. The money would be added to Safe and Sound's existing contract, already one of the city's five largest no-bid deals.

Half the $40 million in services was shifted this fiscal year; the other half is contingent on the approval of state funding for DHS. Whether the state will provide that money should be known next month.

The potential transfer of so much money drew a rebuke last week from Democratic mayoral nominee Michael Nutter, Street's likely successor.

"There should not be dramatic changes and significant transfers of city funds out of the general fund in the waning days of any administration," Nutter said. "The next mayor should have the opportunity to structure the government as he wants to and should not be faced with a significant loss of general-fund dollars shipped off to organizations not within the control or oversight of the city government."

Street, in directing the money to Safe and Sound, is responding in part to a recent scathing report that urged DHS to reform itself by returning to its core function of keeping children safe. An Inquirer investigation in the fall raised questions about how children known to the city department could have died of abuse or neglect.

Acting DHS Commissioner Arthur C. Evans said Friday, "We as a department have to focus much more narrowly around the mission of child protection."

That means, among other things, shifting many prevention programs, and possibly hundreds of contracts, that DHS oversees to the nonprofit.

"It makes sense to merge similar contracts in the same place," Evans said. It is also more efficient, with less red tape, he said.

When Evans became head of DHS in the fall, Safe and Sound had already begun absorbing some of the prevention work, running programs aimed at reducing truancy and teen violence.

Street has championed the nonprofit for years. His predecessor, Ed Rendell, founded it as a city program in 1998 and chose Street's wife as its first director. She reported to the city recreation director until one week before Street took office as mayor in 2000. That was when Safe and Sound was spun off into a tax-exempt nonprofit.

Street did not reply to an e-mail late Friday asking why he had selected Safe and Sound to take on the work. But Post said in a phone interview that Street had told her he did so on the advice of Evans and his director of social services, Julia Danzy, as they sought to rebuild DHS after the child deaths.

Post said she had nothing to do with the shift. "It wasn't my request. I wouldn't request that," she said, adding that she believed that since she had left the nonprofit, the mayor had "come to rely on it extensively."

"This is a mayor who in his own right has very strong opinions about the direction this city takes and how it invests in children," Post said. "I think people underestimate him when they want to suggest I have that much influence."

Among other services, Safe and Sound oversees some of the city's after-school programs, antitruancy efforts, and curfew centers, and produces an annual children's "report card." It functions largely as an intermediary, channeling money to community organizations.

With the extra money, Safe and Sound would mainly expand work it already does.

But the growth in money and services has been questioned by some of Safe and Sound's own board members, including two who declined to speak on the record. The change, meanwhile, has been ardently defended by Post, a lawyer with a 30-year background in child advocacy.

The resulting tensions were captured in the last 10 days in e-mail exchanges that disclose concerns about Safe and Sound's future. The e-mails, obtained by The Inquirer, were confirmed by Post and several board members.

The e-mails were primarily between Post and board member David Fair, who was second-in-command at DHS until 2005. Fair declined to be interviewed for this article.

The exchange began June 7, when Fair wrote detailed questions asking Safe and Sound president Anne Shenberger how the added $20 million the nonprofit expected to get would be spent, and how that money was being generated.

The social-service community was worried that Street wanted to cut dozens of DHS programs run by small agencies - including some programs Fair helped create - to pay for new Safe and Sound services. Fair said small community agencies viewed Safe and Sound as working in concert with the city.

So at 2:46 p.m., he wrote Shenberger, "I think we are in danger of making some serious mistakes which will undermine our chances for survival and growth when there is a new team in City Hall."

Though Post had not been copied on the e-mail, in three hours, at 5:47 p.m., she wrote to Fair, "I hear you're having some issues with the parenting or other prevention programs . . . is there something else going on that the Mayor and I don't know about?"

Post and Shenberger were vague in interviews about how it came to be that Post replied to Fair. Post said she had known of his unease because "I still have tentacles in the provider community."

From then, Fair and Post had an acrimonious e-mail exchange that was eventually shared with the full 16-member board.

"If the next mayor wants to criticize this transfer, he risks incurring the wrath of a very powerful and knowledgable group of folks who clearly advocated for such a transfer, allowing for greater focus on the abuse and neglect work," Post wrote Fair at 6:56 a.m. the next day.

She also accused Fair, whom she has known for years, of having other motives for his questions: that he wants to join the Nutter administration, and that the United Way, where he works now, wants a share of Safe and Sound's work. "I am so deeply disappointed and disturbed by what appears to be your putting your ambitions before the good of the kids," Post added in an e-mail an hour later on June 8.

Responding at 8:31 a.m., Fair denied that the United Way sought any of the work, calling that "an absolute lie." He also said, "My concern is not about shifting appropriate programs to [Safe and Sound] - we can't do any worse than DHS does - but closing them altogether without any effort to understand their effectiveness . . . ."

At 7:10 a.m. last Sunday, Post repeated her belief that Fair was acting out of a desire for political gain. She wrote: "More of the tax reductions kick in each year and we have a commitment out there to hire 500 police officers over three years. Any idea what that costs and how it will impact the city's ability to maintain the ever-decreasing safety net of services? Save your energy for the future, you're going to need it."

Post told The Inquirer that the e-mail "was personal between me and David, and I didn't do it to influence the board. . . . It was meant as an exchange with my good friend, with whom I have a current disagreement."


Contact staff writer Marcia Gelbart at 215-854-2338 or mgelbart@phillynews.com.

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