Yonts calls for audit of Dismas Charities

Dismas Charities, the network of halfway houses in Kentucky and elsewhere, has recently garnered headlines after revelations that the nonprofit shelled out tens of thousands of dollars for luxury suites in Papa John’s Stadium and the new arena in downtown  Louisville, and offers its top executive a compensation package of more than $600,000.

Dismas conducts nearly all of its business with state or federal governments – as much as 99 percent of its revenues in 2008 came from its contracts with government entities.

Here’s an excerpt from an editorial we wrote on the subject last week —

News of these excessive expenses were met with outrage by some, and calls for investigation by others, including state Rep. Brent Yonts, a Greenville Democrat. State Auditor Crit Luallen issued a statement saying that “these examples of spending by an organization funded primarily with public dollars raises serious questions.”

The same was said about the Kentucky League of Cities, which was exposed for squandering money – taxpayer money paid to the League for its services – on travel, restaurants and extravagances. The same was said about the Kentucky Association of Counties, which like KLC was using taxpayer dollars to pamper top executives and officials.

With the KLC and KACo, there were many who praised the services they provided while condemning their excesses, and it’s not a stretch to see similarities in how Dismas Charities conducts business. Dismas is a not-for-profit charity, and its spending practices should better reflect its core mission of providing these valuable services to offenders at the least-possible cost to government.

Until then, the state should rethink whether tax dollars are best spent helping fund the luxurious diversions Dismas Charities officials have chosen to pursue.

Today, Yonts called on Luallen and Attorney General Jack Conway to open an investigation into the charity, and compares its business practices to “those which were condemned in the past two years by financial institutions in their greed.”

Read the full letter below.

September 7, 2010

The Honorable Crit Luallen

State Auditor

209 St. Clair Street

Frankfort, Kentucky  40601

The Honorable Jack Conway

Attorney General

Commonwealth of Kentucky

700 Capitol Avenue

Frankfort, Kentucky  40601

Dear Crit and Jack:

I am writing you concerning the issues associated with Dismas Charities as they relate to the facts the public’s perception, and the likely reality that Dismas Charities may have abused the public trust placed in them while being allowed to be a charity and receiving substantially all of their money from the governments of the United States and Kentucky.  Specifically, the first thing to remember is that this group is a charity.  There are certain perimeters and guidelines that must be followed to retain charitable status.

In the Commonwealth of Kentucky, Dismas Charities receives in excess of $1 million to run half way houses for the Department of Corrections.  It receives a few dollars from a Catholic charity.  The balance is received from the U.S.  government.  My understanding is based on what has been reported by the press.  Also, as reported by the press, the CEO receives an annual salary in excess of $600,000.  A deputy receives a salary in excess of $400,000, and others receive large sums as well.  The charity has rented a box at the new basketball stadium in Louisville, for four years minimum, at $92,000 per year.  The charity has also had a box at Papa John’s Stadium, for which they pay for $45,000 a year, and spent $15,000 to remodel it.  In addition, the charity has leased a renovated party caboose at Papa John’s for an unknown price and for an unknown period of time.

These appear to be the facts, and the perception is when governments are broke and monies for needed services are hard to come by, this charity has taken on activities similar to those which were condemned in the past two years by financial institutions in their greed.

This fact pattern begs for an audit and an investigation by your respective agencies under all authority you have.  The facts command an accounting.  The position of Dismas Charities offering no apologies merely adds to the public insult.

I look forward to hearing from you.

Sincerely,

Brent Yonts

State Representative