25-03-2025
'They have everything': SDC says it's transparent about financial health with funding at risk
The Social Development Commission's board held an emergency meeting Monday to establish a plan to fight for its designation as a community action agency. But some commissioners weren't quite prepared for battle.
The board has 11 days to prepare for its hearing with the Wisconsin Department of Children and Families on April 4. Without SDC's community action agency title, the commission that oversees millions of federal tax dollars meant to assist low-income residents won't be eligible for the federal Community Services Block Grant.
The board was blindsided by the Department of Children and Families' letter Friday afternoon, said Jorge Franco, board chair and interim chief executive officer.
Moments after a call between the department and commissioners, the department sent a stern letter declining funding SDC in 2025, Franco said. The letter outlined its frustration with SDC's inaccurate information regarding its financial health, and its noncompliance with state and federal requirements, according to the department.
"I, for one, have a great deal of frustration with DCF because I felt like they were playing hide the ball with SDC," Franco said at Monday's meeting.
The agency's attorney, William Sulton, said losing the grant won't be the end of SDC, which had a $30.5 million operating budget last year, but will have an effect on the commission that provides career services, child care and housing assistance.
Commissioners hadn't had a chance to review the letter in depth or as a board, said commissioner Walter Lanier, who joined in January.
Although commissioners agreed on the importance of the anti-poverty agency that was founded in 1963, some weren't certain whether the state department's numerous accusations against SDC were false.
Both commissioners Pamela Fendt, who joined the board in February, and Lanier said they aren't caught up on many of the department's allegations in the letter.
"(The letter) has political implications, legal implications, fiduciary implications," Lanier said. "We've got to look at the facts to determine what's going on here."
Franco says SDC worked "around the clock" and "all night" to meet the Department of Children and Families' demands. Originally they were told the funding application deadline would be between January and February, but subsequently the deadline moved to Dec. 23.
The agency spent $9,000 digitizing more than 40,000 pages of documents to meet the department's abrupt deadline, Franco said.
Diane Robinson, SDC's executive director, agreed with Franco. She added she was in frequent communication with the department. SDC met weekly with the department, Franco said.
The Department of Children and Families' letter doesn't mention a Dec. 23 deadline.
Franco says the commissioners' calls with the department gave them the impression that they were in good standing.
Right around the start of the new year, the department told SDC their application for $2.1 million was to be approved in about two weeks, Franco said. The department, ultimately, didn't approve that grant.
Franco says SDC gave the department full access to the agency's entire accounting system.
"They have everything," Franco said.
The agency is cooperating with the Department of Administration's forensic audit and working with Clifton Larson Allen to complete its audit, Franco said.
Vincent Bobot, the longest serving board member and president of SD Properties, says under Franco's and Robinson's leadership SDC has been transparent with state departments and the public.
"We're all for giving full access, complying with all audits, making sure everything is done efficiently in a professional manner," Bobot said.
On the other hand, some commissioners want more transparency.
Fendt says she'd like the board to see what information SDC shared with the Department of Children and Families.
"One of the things that the letter stated was DCF lacked a clear understanding of SDC's financial picture, and I sort of share that feeling," Fendt said. "I'm not quite clear on SDC's financial picture."
Fendt, who is the president of the Milwaukee Area Labor Council, added she's unsure of what information SDC provided the department regarding its number of employees. The department's letter says SDC reported it had 28 staff members but failed to show documentation to back that up.
Lanier added he needed to feel confident in what SDC shared with the state before asking people to show support at the upcoming public hearing.
"I'm not ready to extend that call yet," Lanier said.
Robinson plans to share SDC's records that dispute the department's claims against the agency with commissioners in the days leading up to the hearing.
All members of the community are welcome to attend the Department of Children and Families hearing to consider SDC's future as a community action agency. The hearing is at the Milwaukee State Office Building, 819 N. Sixth St., on April 4 from 11:30 a.m. to 1 p.m.
This article originally appeared on Milwaukee Journal Sentinel: SDC in Milwaukee says it's transparent with Wisconsin department
