At its January 8 meeting, the City Council will act on a staff proposal that City discontinue its financial support of the Pico Youth and Family Center, owing to its inability to meet the requirements of a “Last Chance Agreement” entered into last June.

The staff recommendation follows the resignation of Amanda Seward, Chair of the Center’s board, and five board members in December.About the same time, a complaint about City Manager Rod Gould was filed by Oscar de la Torre, Executive Director of the Center.

Dated December 12, Seward’s six-page letter begins, “I hereby submit my resignation, effective immediately, as Chair of the Board of PYFC. I have lost all faith in the ability of Oscar de la Torre, as executive director. His action in creating more community strife and, in my view, his misuse of his special leadership role in the community have created an untenable situation in which the viability of the organization is seriously threatened.”

She goes on to describe in detail the deteriorating relationship between the City and the Center, and de la Torre’s part in it.

Seward, an attorney, grew up in Santa Monica and attended school here. She was one of the leaders of the Black Student Union, which got a black studies history class added to the Samohi curriculum. A couple of years ago,she played a leading role in saving the Lincoln Place Garden Apartments in Venice and the tenancies of its elderly and disabled esidents tenancies who were threatened with eviction by one of the nation’s leading owners of apartments.

The five other board members who also resigned last month are Jan Book, Ira McAlily, Shelly Wood, Jill Moniz and Wendell Shirley. In their letters of resignation, nearly all of them noted the difficulty of working with de la Torre, and offered specific examples

According to the staff report, the story of the Center began in July, 1999, when the City issued a Request for Proposals (RFP) to fill what it called “a specifically defined gap in services for the hardest-to-reach,vulnerable gang involved youth in Santa Monica. Targeting ages 16-24, youths were to meet one or more of the following criteria: dropped out of local schools; enrolled in Olympic Continuation School after dismissal from Santa Monica High School;formerly incarcerated; identified as serious habitual offenders; or on parole or probation.”

“Since June 2000, the City has funded PYFC to serve this important segment of the youth population through concentrated focus and attention, employing a community-based model of intervention in partnership with other local and regional organizations and institutions. Through the years, PYFC has broadened the population of youth and has undertaken social justice and community organizing activities that have diverted program focus and resources away from the original intent of City funding.Over twelve years, the City has identified numerous serious and persistent organizational, financial and programmatic deficiencies.

“Throughout the past twelve years, the City has made an unprecedented effort to ensure administrative accountability, organizational structure, and adequate oversight to support and strengthen PYFC and its programs. Since 2000, more than $4 million in City General Funds have been invested in the organization…

“Between 2000 – 2004 the City supported the development of PYFC through three well-established non-profit management entities – Community Partners (January 2000 – June 2001), Woodcraft Rangers (July 2001 – August 2003), and Public Health Foundation Enterprises (PHFE) (September 2003 – August 2004). Each organization was tasked with providing training, program development assistance, administrative and financial support to PYFC. Despite their efforts, all three agencies terminated their relationships with PYFC, citing concerns regarding the viability of PYFC and expressing their inability to provide the level of oversight required to address PYFC’s administrative and organizational deficiencies…

“By June 2004, PYFC had applied for its 501(c) 3 status as an independent non-profit. Recognizing the need for services for the hardest-to-reach, vulnerable gang involved youth, the City gave PYFC yet another opportunity to provide these services through approval of a direct grant
for the period of September 1, 2004 – June 30, 2005. The grant was awarded based on assurances from the PYFC Advisory Board (Board) that it was positioned to assume full responsibility for the contract and Center operations. The Board was required to put mechanisms in place to provide for adequate staff supervision including written assurances to the City that the Board would be responsible for oversight and performance of the Project Director in his transition to Executive Director of PYFC.

“Furthermore, since 2004, and consistently for the ensuing seven years, the City has provided PYFC staff and Board with technical assistance regarding organizational, administrative, financial and program operations. This includes added funding for executive coaching, Board development, and staff training. No other HSGP grantee has received anything approaching this level of guidance, training, monitoring, feedback and support from City staff and consultants. Despite these efforts, PYFC has continued to exhibit on-going and serious deficiencies.

“On June 21, 2011, in order to address the long-standing concerns about PYFC’s governance, financial and administrative capacity, the Council-approved HSGP included the following funding condition: ‘The PYFC Board of Directors will implement significant administrative changes to ensure accountability, adequate fundraising, and program development – this includes assessing the feasibility of merging with a larger community- based non-profit.’ City staff worked closely to monitor compliance and consistently communicated its feedback to PYFC representatives.Despite the City’s significant efforts to provide assistance and the Board’s commitment to implement improvements, by February 2012 it was clear that PYFC had not developed an effective strategy for making these improvements. They also had not identified an organization to merge with and the Executive Director communicated that he did not believe that this was the right direction for PYFC to take.

“The circumstances demonstrated that PYFC would not be able to meet the multiple conditions of their grant by the end of the fiscal year. Accordingly, staff recommended a final opportunity for PYFC through a ‘Last Chance Agreement’ which was presented on May 22, 2012, as part of the Council Budget Study Session. The agreement required PYFC’s Commitment to accept the assistance of new independent oversight to increase fiscal, administrative and programmatic accountability. City staff conducted research and contacted several organizations with experience in working with agencies with similar missions as PYFC. City staff identified Social and Environmental Entrepreneurs (SEE) given their 17 years of experience in incubating and providing administrative support and oversight to non-profit organizations.

On June 12, 2012, the ‘Last Chance Agreement’ was approved by Council for the period July 1, 2012 through December 31, 2012. This agreement included funding in the amount of $157,610 for SEE to provide independent oversight of PYFC for program operations and organizational oversight, and $25,000 for services of an organizational development consultant to provide SEE and the Board with assistance with oversight of the Executive Director, training for staff and the Board in program development, leadership and agency oversight including the establishment of benchmarks to increase
administrative capacity and program refocus. The ‘Last Chance Agreement,’ also specified that failure to document significant improvement in the grantee’s performance would lead to a recommendation to terminate funding.

“On December 7, 2012, staff received the final Organizational Assessment Report (Assessment) prepared by the organizational development consultant pursuant to her scope of work with SEE (Attachment A). In this Assessment the consultant expressed her significant concerns regarding the viability of PYFC due to tremendous discord between the Executive Director, PYFC staff and the Board over issues of leadership, mission and purpose. On December 21, 2012, the City received formal notice from SEE, transmitting letters of resignation from six members of the Board (Attachments B1_B6) as well as a letter of resignation from the organizational development consultant. The Assessment and Board resignation letters demonstrated that PYFC’s organizational structure had collapsed, indicating that the organization likely could neither meet the requirements of the “Last Chance Agreement” nor fulfill the City’s funding goals in the future. The City Manager exercised his authority to extend the contract agreement with SEE through January 31, 2013 while staff gathered documentation to support a final recommendation regarding future funding of PYFC.

“’The ‘Last Chance Agreement’ imposed conditions for continued funding. Staff believes that these conditions were not met in spite of the combined and strenuous efforts of SEE, the organizational development consultant and the Executive Committee of the Board, especially the former Board Chair. Furthermore, the primary focus of SEE in the past six months has been on fiscal management of PYFC. This has proven ineffective in addressing the fundamental organizational challenges. The PYFC requires more on-site
administrative oversight and supervision than is available through resources existing within SEE. Furthermore, SEE is the fourth organization that has been brought in for this purpose. It is clear that none of these organizations have been able to address the fundamental organizational, financial and administrative challenges of PYFC. This demonstrates that PYFC does not have the ability to stand on its own and operate responsibly as an independent non-profit.”

“Staff is recommending that the Council discontinue on-going funding of Pico Youth and Family Center (PYFC), a grantee of the Human Services Grants Program through the expiration of the ‘Last Chance Agreement’ with Social and Environmental Entrepreneurs (SEE), a California-based non-profit corporation; and Authorize the City Manager to negotiate and execute a modification to Contract No. 9605 in an amount not to exceed $78,805 with SEE to close-out outstanding financial and reporting obligations including compensation (up to three months) for PYFC staff

“City staff will ensure that programming will continue without interruption through collaborative efforts with key non-profit providers.”

A $1,600,000 endowment was offered to PYFC in September. City staff has learned that the estate is currently withholding the transfer of the gift.