Closure of Social Development Commission prompted by ‘misallocation of funding’
A social services agency that’s been a lifeline in Milwaukee for more than 60 years has abruptly shut down. The Social Development Commission (SDC) had three locations in Milwaukee and one in West Allis.
The sudden closure has left both employees and clients in the lurch.
For decades, the nonprofit Social Development Commission has assisted and advocated for Milwaukee County residents living in poverty. Their funding comes from a mix of public and private dollars. Their programs range from energy assistance to food programs to even the foster grandparents’ program Charles Dansby works for helping special needs kids at school.
“I’m there to help mentor them, help them with their work, anything I can do for them,” Dansby said Monday, April 29, 2024.
But as he just learned, the agency abruptly shut down Friday, April 26, 2024, laid off the last of their staff, and said they were unsure they’d reopen.
“It’s always been here for the community. What’s going on now is bothersome. I really hope they get back in functioning,” he said.
In an open letter last month, the SDC revealed “instances of misallocation of funding have been uncovered.”
“It’s really a sad, sad, situation,” said Jean Shallow outside of the SDC’s main office at 17th Street and North Avenue in Milwaukee.
She used the Social Development Commission’s free tax preparation program and now doesn’t know if they were even filed.
“And I don’t want to be penalized for late taxes and they said that they would put an extension in. I don’t even know if that was done,” Shallow said.
Another client showed up and appeared frustrated when the door was locked.
“Now we got all these consumers out here waiting for taxes, and the doors is closed,” said Ike Hernes, who also left his taxes there, and hasn’t heard a status.
“I want to know where’s my taxes at that I sent in in January. I had a reply saying to come down to sign for them, they’re ready. I come down and they’re locked up,” Hernes said.
Late Monday, the SDC’s tax program director did return a call to WISN -TV 12. Diane Robinson said she is working with the Internal Revenue Service to ensure the approximately 800 returns still to be filed will be handled correctly. She said extensions were all filed by the deadline, and the remaining returns are simply waiting for signatures. Robinson said they’re searching for an alternative site to facilitate that.
“We are not going to let them fall by the wayside,” she said Monday night. “We just have to figure out how we’re going to do it,” Robinson said.
SDC’s attorney Monday told WISN-TV 12 News the board is meeting is Thursday, May 2, 2024 to chart a path forward for the agency.
“We believe we’re going to be able to right this ship,” William Sulton said.
Sulton said the former director of finance had been terminated, and he “absolutely misrepresented the financial situation.”
Sulton said CEO George Hinton also resigned at the request of the board.
“I have no evidence of theft,” Sulton said.
Milwaukee police said Monday they do not know about a criminal investigation. Sulton said he too was unaware of a criminal probe.
The Wisconsin Department of Administration confirmed it has suspended payments to SDC pending the results of a fiscal audit.
In a statement released on Monday, April 29, DOA Communications Director Tatyana Warrick said “During an annual financial review in November 2023, DOA Division of Energy Housing and Community Resources (DEHCR) staff discovered late payments from SDC to contractors, which prompted further inquiries and review related to administration of weatherization funds.
“DEHCR has not given additional funds to SDC since that point. DEHCR suspended SDC’s weatherization contract in March 2024 to conduct an audit. To minimize disruption and to ensure continuity of services for weatherization and program customers, two other Milwaukee area agencies (La Casa de Esperanza and Partners for Community Development) have been asked to step in to cover ongoing work and new referrals.”
