Operation Breakthrough, a Durham anti-poverty agency, faces a loss of state funding that could threaten its existence after 50 years in business.
“That’s what we’re working on trying to prevent,” director James Tabron said last week. Tabron said the agency had made “a rather thorough response” to the state’s announced intention to “de-designate” Operation Breakthrough.
In an April 22 letter, Verna P. Best of the state Office of Economic Opportunity (OEO) told Breakthrough board Chairman Michael Page that the de-designation was due to “repeated non-compliance with regulations” and several other factors including more than $70,000 in “disallowed expenditures.”
“De-designation” would mean a loss of Community Service Block Grants (CBSG), said Kirsti Clifford of the state Department of Health and Human Services, which had not received Tabron’s response as of Thursday.
CBSG provided Operation Breakthrough $487,564 for the current fiscal year, Tabron said. An application for extra funding, which would raise the year’s total above $700,000, remains in limbo “because of the current situation,” he said.
According to Best’s letter, the decision to cut off CSBGs was made after a follow-up review of the agency’s actions to correct 19 rule and policy violations OEO analysts found in 2013.
The violations occured in fiscal 2010-11 and 2011-12, before Tabron and some of his staff came to work at Operation Breakthrough.
“We do not feel the current (Operation Breakthrough) team has been given an adequate opportunity to move forward in a way that everybody has a right to expect,” said Tabron, who has been director for 10 months.
After Tabron took over last summer, the agency agreed to improve its its record-keeping, enforce board attendance rules and improve its operational procedures to prevent lapses of compliance in the future.
OEO’s followup review in January and March this year reported numerous failures to follow through on those measures. Breakthrough is appealing $60,143 of the disallowed expenses, but has to pay OEO back $10,299.82 by May 21.
“We’ve done everything the state has asked us to do, for the most part,” Page said. “We’re facing one repayment of funds, but we’ve been working on that for some time now.”
Established in August 1964 by the North Carolina Fund, an anti-poverty program set up by then-Gov. Terry Sanford, Operation Breakthrough runs a job-training program, a weatherization program and Durham locations for the Head Start pre-kindergarten program, all serving low-income residents. Tabron said it has 910 clients in the current fiscal year.
Operation Breakthrough’s most recent Internal Revenue return, filed in August 2013 and covering October 2011 through September 2012, shows $5.8 million in expenses and $5.6 million in revenue, almost all from government grants.
The violations occurred during a period of heavy employee turnover, and Tabron said he and other new administrators have brought “stability and order” and increased the number of clients while the board has rededicated itself to proper oversight – a failure in years past.
“I almost feel to some extent we’re held hostage to our past,” Tabron said. “Not to say everything’s been right, but I think that if we were being looked at just in this one year’s performance, de-designation is not even something that would be on the radar screen.”