oversight

Review of Certain Activities of the Economic Opportunity Board of Washoe County, Reno, Nevada

Published by the Government Accountability Office on 1971-08-10.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

Review Of Certain Activities
Of The Economic Opportunity
Board Of Washoe County,
Rem, Nevada B-73o515

Office of Economic Opportunity




BY THE COMPTROLLER   GENERAL
OF THE UNITED STATES       ’
                       COMPTROUER     GEt-dERAL    0P      TflE      WMITEE)   STATES
                                    WASSHIMGTON.    O.C.          2O?W3




B-130515


Dear Mr.     Baring:
        In accordance with your request of March 29, 1971, we
have examined into the statements        of Mr. Onie Cooper concerning
certain    activities of th 'Economic     Opportunity      Boar&of  Washoe
County;‘ ‘RAnA, Nevada' . (ag&     *  The  acency     is  an/Office ?Yf-.-- P : :t:
Ec%%%&c Opportunity       iO60) community action        agency that admin-
isters    antipoverty programs in Reno, Nevada, under grants from
OEO and Ke Department       of Labor7
      In a letter  to you dated November 20, 1970, Mr. Cooper
stated that the agency had disregarded    its personnel      proce-
dures in his on-the-spot   dismissal  from employment with the
agency and that the agency had made certain     questionable
expenditures.
        During our review we met with Mr. Cooper, who provided
us with additional        information'on          his dismissal          and the ex-
penditures      which he had questioned             in his letter.            He
claimed that (1) his dismissal               was not in accord with the
agency's personnel        manual, because he had not received.the
required     hearing   prior    to the termination             of his employment,
 (2) Mrs. Juliette      Porter had benefited               personally       from the
funds provided       to her for a dance, (3) funds provided                        to the
Washoe County Task Force had not been used to benefit                              the
poor8 (4) Mr. Archie Curtis,             who   was      paid   to   provide      techni-
cal assistance       to the agency, had no previous                   experience       or
training     in or with OEO and had produced nothing                      from which
the agenq or its staff            could benefit,            (5) agency employees
had been paid wages while pic%.eting                  the U.S, Census Bureau in
Heno, Nevada, and (6) a bill              for attorney         fees had been sent
to the agency for two persons who had been arrested                            while
picketing      the Census Bureau.           Mr. Cooper also pointed                out
another questionable          expenditure       involving        food provided         to
picketers.
        Our examination    included      (I) a review of apilicable     OEO
instructions     and records and pertinent          records of the agency
and {Z) interviews      with-officials       of OEO, the agency. the
State of Nevada Department            of Economic Opportunity    and with
Mr, Cooper and certain        other persons.



                               50TH ANW'ERSARY ?92?-1971
B-130515


TERMINATION      OF M.R. COOPER"S ElXPLOYMENT
      Mr. Cooper claimed    that the agency's      termination      of his
employment    was not in accord with the agency's         personnel     man-
ual because he had not received       the required     hearing    prior    to
the termination    of his employment.      Mr. Cooper was employed           as
the coordinator    of the agency's    Neighborhood     Youth Corps pro-
gram.
        The agency's    personnel    manual provides      that         the executive
director    of the agency may-- after       an employee has              been given
an opportunity       to be heard--suspend      without    pay,         demote, or
dismiss    an employee when other forms of disciplinary                      or cor-
rectional    action    have proved ineffective         or when         the serious-
ness of the offense        warrants.
         The manual specifies           reasons    for disciplinary          or correc-
tive     action    against     an employee,      including      (1) incompetency,
inefficiency,          or negligence       in the performance          of duty,
 (2) insubordination,            (3) activity      which is incompatible           with
employment,        and (4) falsification           of records.      , The manual
provides       also for a chain of command within                the agency for
appealing        supervisory      decisions     and for filing         grievances.
If still       dissatisfied,        the employee may bring           the matter
before      the Personnel       Committee      of the Board of Directors            and
the Board of Directors             of the agency.
        The interim      deputy director          of the agency notifie-d
Mr. Cooper, by letter             dated July 17, 1970, that his 'employment
with the agency would be terminated                   within     30 days unless
changes took place in his performance                     and attitude.         The
letter    cited     the following        reasons:        (1) the placing        by
Mr. Cooper of his name as signatory                   to a checking         account   of
the agency without           authority,        (2) insubordination          toward the
executive      director      and the interim         deputy director,          (3) issu-
ing press releases           involving       the agency without         the consent
of the executive         director,        (4) Mr. Cooper's         behavior     at a
public    meeting,      and (5) not efficiently              working    toward the
goals of the Neighborhood               Youth Corps Program.
        In a letter    dated July 21, 1970, Mr. Cooper responded        to
the interim      deputy director's      letter of July 17, 1970, and
requested    a hearing     on this matter.     Prior  to a hearing,  the
interim    deputy director,       on July 22, 1970, terminated
Mr. Cooper's      employment    because of the attitude    displayed   by

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Mr. Cooper in his July letter.        After his termination
Mr. Cooper again requested     a hearing.     Agency records    showed
that hearings   were held on this matter      before  the executive
director   on August 3, 1970, the Personnel       Committee  on Septem-
ber 28, 1970, and the Board of Directors         on October  29, 1970.
These hearings    upheld the termination    of Mr. Cooper's    employ-
ment.

       Consequentlyj       although    the agency has not followed        its
personnel    manual by terminating           Mr. Cooper's    employment
prior   to a hearing,       the required       hearing   was held by the
agency shortly       after     the termination       of Mr. Cooper's   employ-
ment.
FUNDS PROVIDED BY AGENCY TO BELL STBEET CLUB
      Mr. Cooper claimed    that Mrs. Juliette       Porter   had bene-
fited  personally   from $500 of CEO funds provided         to her by the
agency to hold a dance.       He stated    that the dance was held in
March 1970 by an organization       called    the Bell Street    Club and
that a $1 admission     fee had been charged.
        The agency's       executive       director     informed     us that the
Bell Street       Club, of which Mrs. Porter'was                 president,     was a
private    social     club.     Agency records          showed that       it had dis-
bursed $500 to the club for the purpose of purchasing                           500
dance tickets        which were to be distributed                to poor and minority
group youths       so that they would be able to attend                     the dance.
The agency's       executive       director      informed     us that the $500 was
given to the club to entertain                  youth during       a period    of unrest.
        Mrs.     Porter informed    us that she had given the               dance
tickets      to two agency employees       for distribution         to      youths.
The two agency employees,            a community   worker      and a       nutrition
worker,      informed   us that the dance tickets          had been         given to a
number of youths        for distribution      to their     friends.
       The agency check for $500 was made payable    to the Bell
Street   Club.   Bank officials  informed us that Mrs. Porter    had
endorsed    and cashed the check for the club which did not have
an account with the bank.
       We were unable        to determine  the extent to which the $500
was used to support          the dance, because Mrs. Porter   would not
discuss   this matter        with us and would not grant us access to
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the financial     records of the club.    One of the agency officials
who had handled the distribution       of the tickets     attended    the
dance and informed       us that about 200 to 300 people had attended
the dance, which was held at an American Legion hall,              and that
entertainment     had been' furnished  by a band.     Mrs. Porter
informed    us that the club had not provided      refreshments      at the
dance.
        OEO instructions        permit youth recreation              activities,    such
as dances, to be conducted by community action                         agencies under
special    summer programs.             The agency"s grant for the program
year in which the.$500           was expended provided             for a special
summer program but did not provide                 for youth recreation          activ-
ties to be conducted           under the program.              OEO officials,    how-
ever, informed        us that,      although    the agency's         grant did not
authorize     recreation       activities,      they were of the opinion            that
the expenditure        for the dance was appropriate                 because it was
OEO's policy      to give grantees,some            flexibility         in the use of
grant funds.
      We were unable to determine,   on the basis of information
made available   to us, whether Mrs. Porter had benefited     person-
ally from .the $500 of OEO funds provided   to her by the agency
to hold a dance.
FUNDS PROVIDED BY AGENCY TO TASK FORCE
       Mr. Cooper claimed that over $3,000 of OEO funds                      had been
provided   by the agency to the same Mrs. Porter    for an                   organiza-
tion called   the Washoe County Task Force and that the                      expendi-
ture of these funds had not benefited     the poor.    Mrs.                  Porter
is one of the founders    of the task force.
        Agency records showed that the agency had made a grant to
the task force of $3,000-42,000         in July 1970 and'$l,OOO in
September 1970 --for    the purpose of purchasing        materials    in con-
nection    with a cooperative   marketing    club established       by the
task force to produce and sell hand-crafted           articles     at a
profit.      An agency official  informed,us     that the task force was
comprised of poor' people.
      The amount of the grant was based on a listing          of materi-
als and expenses for freight,     kilri repairs  and components and
an item classified  as miscellaneous.       The specified,materials

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included   clay,  glazes,     jewelry   chain and findings,         and molds.
The grant specifically        excl‘bded the use of funds      for     salary,
insurance,    and fringe-benefit       expenses.
       The task force received  from the agency two checks total-
ing $3,000.     Both checks were endorsed by Mrs. Porter and an-
other member of the task force;     $1,600 was deposited to the
checking   account of the task force and $1,400 was taken in
cash.
      At the time of our review,       the task force's   records were
not maintained   in a manner which would enable their         being au-
dited to readily   verify     the purposes for which the $3,000 was
used.   At our request    the task force furnished      us with a list
of grant disbursements      totaling   $2,483 for the period     July
through November 1970, which are summarized as follows.:
                  Purpose of
                  e'xpenditure                   Amount
               Materials                         $1,009
               Miscellaneous                         427
               Repafrs                               255
               Travel                                250
               Purchase of kiln                      146
               Purchase of shed                      120
               Freight                               101
               Food                                   62
               Purpose not shown                     213
                    Total                        $,2,;4.83

      The list of disbursements furnished by the task force did
not show the purpose for which $113 was expended and did not
account for $517 of the grant of $3,000.
      The expenditures  totaling   $578 for food, travel,      and the
purchases of a shed and kiln     appeared questionable    because such
expenditures   were.not included   in the listing    of materials    and
other expenses on which the amount of the gr'ant was based.
       We brought       the questionable     expenditures and lack of ac-
countability         to the attention    of OEO's San Francisco   Regional
Office     officials      who informed   us that they would arrange to
have the task force's           books audited.

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EMPtiOYMENT OF ARCHIE CURTIS AS A CONSULTANT
         Mr. Cooper claimed that over $700 of OEO and State of
Nevada Department of Economic Opportunity          funds were paid to
a Mr. Archie Curtis,         at $75 a day, for technical   assistance
to the agency.        He stated that Mr. Curtis had no previous
experience     or training     in or with OEO and that Mr. Curtis
produced nothing        from which the agency or its staff     could
benefit.
       Mr. Archie Curtis was employed under a contract              with the
State of Nevada Department            of Economic Opportunity     to furnish
consulting      services.      Agency records showe'd that the services
to be performed        under the contract       were to be provided    to the
agency.      Agency officials       informed    us that Mr. Curtis was to
determine     the needs of the poor and. to evaluate          the agency's
field    workers.      Agency and State of Nevada Department'of           Eco-
nomic Opportunity         records showed that Mr. Curtis had been paid
$750 ($7,5 a day for the period January 5 to January 15, 1970)
from OEO grant funds provided             to the State for training      and
technical     assistance.
       Under section    231 of the ,Economic Opportunity     Act of
19.64, as amended (42 U.S.C. 2824), OEO can provide          financial
assistance    to State agencies to enable them to provide          techni-
cal assistance     to local agencies in ,developing      and carrying
out community action programs authorized       under the act.
        We were informed         by officials         of the agency and the State
of Nevada Department            of Economic Opportunity             that records on
Mr. Curtis'     qualifications           or the results         of his study-had          not
been maintained.          The executive         director     of the agency stated
that Mr. Curtis'        qualifications          had been considered             by the
agency and by the State of Nevada Department                        of Economic Op-
portunity.       He stated        also that,     even though Mr. Curtis               did
not have a college           degree or the formal education                  for the job,
he was considered          to be the ideal man to provide                  the assis-
tance, because, being poor and exposed to poverty#                             he had the
ability    to see,     feel,      and  relate     to    the plight      of   the  poor
and to communicate with them to find out their                          needs.      The
executive    director        stated    further      that Mr. Curtis had submit-
ted satisfactory         oral reports         on the results        of 'his work and
that he did not expect or desire &o receive                        written      reports.



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        Although      we found that Mr, Curtis        had been paid $750 from,
OEO grant funds provided.to             the State to furnish        consulting
services      to the agency, we were unable to make a determination
concerning       his qualifications        for rendering     assistance      or the
benefits      derived    from his work because of the absence of docu-
mentation       06 Mr. Curtis'      experience    and training      and the re-
sults of his study,
PAYMENT OF WAGES TO AGENCY EMPLOYEES
ENGAGED IN PICKETING
     Mr. Cooper claimed that the staff      of the agency had been
paid wages while picketing    the U,S. Census Bureau office    in
Rena, Nevada.   The executive    director of the agency stated that
the purpose of the picketing,     which occurred  during the first
two weeks of April   1970, was to seek gainful    employment for
poor people at the Census Bureau.
      The executive    director  of the agency informed        us that
about nine agency employees had participated          in the picketing
during work hours,       Records were not available      which would
show the total     number of employees participating        or the number
of work days spent by agency employees in the picketing.
Agency records showed, however, that leave slips had been sub-
mitted by nine employees requesting        leave without     pay for a
total  of 27 work days during     the period April      1 through
April  3, 1970,
       The executive     director  of the agency informed      us that the
requests     for leave without    pay had been made by the employees
so that they could participate        in the picketing.       Be said that,
because the reas.on for the picketing       was8 in his opinion,
within    the goals of the agency, he had disapproved          the leave
requests.       Agency records showed that,     for the first     2 weeks of
April    1970, the nine employees who had submitted         requests   for
leave without       pay had been paid their   regular   salary without
charges being made for leave.
       OEO Instruction         6907-3, dated December 14, 1968, allows
community      action     agency employees to participate      in direct ac-
tion   activities.         Specifically   it states,  in part,   that:
       flIn   the    course   of carrying       out     their   advocacy re-
       sponsibilities,         community     action        agencies may some-
       times determine         that   the   best      available     (or the
       only apparent)         means for     self-help        involvement      of
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      the poor lead to such direct        action    activities   as
      peaceful     and lawful   assembly  to obtain      redress of
      grievances      from those believed    capable of allevi-
      ating    them."
             *             *            *             *            *

       "Lawful      direct    action  is permissible,      and often
      necessary,         as an intermediate     step in promoting
      institutional          changes that can lead to permanent
      improvements         in the community's      efforts   to eliminate
      the causes and consequences            of poverty."
             *             *            *             *            *

      "However,    such direct    action   must meet the following
      tests   of permissibility      in order for a community
      action    employee or volunteer      to participate  while   in
      performance     of his duties:
             " a e It must not     be forbidden     under   paragraph       3
                   below.
             "b . It must be directly          related   to the program
                  objectives of the         grantee    or delegate
                  agency.
             “C.   It must have been planned        as a result  of a
                   decision   by a neighborhood      or other repre-
                   sentative   group or by program beneficiaries,
                   not solely   by staff   workers."
      With regard to point         (b) in the preceding       paragraph,      the
agency's   grant agreement      did not provide       that a program objec-
tive of the agency was to obtain            employment    for the poor.         Both
agency and OEO officials        informed     us, however,      that corresnon-
dence from OEO's Washington          headquarters,      addressed     to various
agencies,   contained    information       about jobs which were available
at the Census Bureau and requested            the agencies       to attempt     to
get the poor to apply for the jobs.              Agency officials       stated
that this correspondence        constituted      OEO authorization        to ob-
tain jobs for the poor.



                                        8
        OEO officials     have expressed      the opinion      that the Eco-
nomic Opportunity       Act implies    that an objective           of a community
action    agency is to obtain       employment for the poor and that
therefore     it need not be specifically          provided      for in the
grant agreement to be an objective              of the program,        They
stated,    howeverI   that,   if they had been asked, they would have
counseled     against   the agency's     involvement       in the picketing
at the Census Bureau because of political                implications.
       The Regional      Director     of OEOss San Francisco       Regional    Of-
fice,    in his letter      of December 16,. 1990, informed          you that,
to the--best of his knowledge,            the picketing     by agency employ-
ees at the Census Bureau had not inkolved                the use of OEO funds.
The 'Regional Director         told us in May 1991 that OEO had been
misinformed    concerning        the picketing    by the agency employees
at the Census Bureau.,           The OEO official      who prepared      the Decem-
ber 1990 letter      informed       us that OEOss reply had been, based on
information    provided      by the agency's      executive    director.
      Although we were unable to determine         the total             number of
agency employees participating       or the number of work                days
spent by agency employees in the picketing,           at least            nine agency
employees were paid.wages      while participating      in the             picketing
at the Census Bureau.
ATTORNEY FEES FOR SERVICES
PROVIDED TO ARRESTED PICKETERS
     Mr. Cooper claimed that a bill  for over $200 in attorney
fees had been sent to the agency for legal services    provided
to two persons who had been arrested   while picketing  at the
Census Bureau in %pril  1990,
      Agency officials       informed     us that an attorney           who de-=
fended two arrested       picketers     had submitted         a bill     to the
agency for $848 for fees associated               with the trial.           They
stated that they turned the bill              over to a private          individual,
not associated    with the agency, for payment.                  On October 5,
1990, the attorney       submitted     directly       to the private        individ-
ual another bill      for $649 for fees associated               with the trial
of the two arrested       picketers.        The executive        director       of the
agency provided     us with the canceled checks which evidqced
payment of the bills        by the private        individual,        Agency- rec-
ords showed that neither          of the arrested         picketers      had been

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employe,d by the agency at the time of his               arrest    and that    no
disbursements   had been made.-by the agency             to the    attorney.
       Consequently,  although   a bill    for attorney   fees had been
sent to the agency for legal services         provided  to two persons
who had been arrested      while picketing     at the Census Bureau,
agency funds were not used to pay for the legal services           pro-
vided.
AGENCY FUNDS USED TO PAY FOR PICKETERS' FOOD
        Mr. Cooper informed    us that the agency's   Bead Start pro-
gram had paid for, and had cooked, food for persons who had
participated    in the picketing     at the, Census Bureau in April
1970.
         We were unable to determine         from agency records whether
the agency's Bead Start program had paid fort or whether its
facilities     had been used to cook, food for the picketers.
The agency's       executive    director    and its former deputy direc-
tor informed       us, however,      that,  as private     citizens,      they
had beach received        a check for $600 from a.private            individual
to pay for the food and ancillary              needs of the picketers           and
that they had used the funds for that purpose.                     According     to
these officials,        most of the food was precooked             or was pre-
pared at the site of the picketing              and, to the best of'their
knowledge,      the facilities       or personnel      of Head Start were
not involved       in the food preparation.            The two canceled checks
were made available          to us.     They showed that,       on April     7, 1971,
the agency's executive          director    and the former deputy director
had each received         from the private      individual      a check for $600
in his own name.
     We could find no evidence,               on the basis of information
made available  to usI that the              agency's Bead Start program
had paid for, or its facilities               had been used to cook, food
for persons who had participated               in the picketing  at the
Census Bureau in April   1970.


        Officials    of OEO, the agency; and other organizations    and
individuals       mentioned   in this report have not been given an
opportunity       to formally   examine and comment on the contents
of this report.


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  B-130515


        We trust   that   this   information    will   be of assistance
  to you.




                                               Comptroller   General
                                               of the United   States
  The Honorable  Walter    S. Baring
1 House of Representatives




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