Multnomah County has ceased funding for the Rockwood Community Development Corporation (CDC), citing significant financial mismanagement as the primary reason for the decision.
The nonprofit organization, which operates a 65-room apartment tower in Gresham designated for emergency shelter housing, has been accused of seeking reimbursement for expenses that were not pre-approved, double-counting costs, and incorrectly charging the county for rooms that were temporarily closed for repairs.
For three years, Rockwood CDC has maintained a contract with Multnomah County to reserve 50 of its rooms for emergency housing, funded by the county.
However, recent scrutiny of Rockwood’s business practices prompted county officials to draft a memo detailing their findings.
Dan Field, the recently retired director of the county’s Homeless Services Department, recommended terminating the contract with Rockwood CDC at the end of the fiscal year on June 30.
This decision carries significant weight, as Multnomah County allocates over $1 billion in services through various nonprofit organizations like Rockwood.
The county’s elected auditor, Jennifer McGuirk, previously criticized the county for not ensuring its contracted nonprofits provided the promised services.
In an official statement, the county emphasized its responsibility as a steward of taxpayer funds, stating, ‘Our due diligence revealed that one of the county’s contracted family shelter providers, Rockwood CDC, was spending public dollars for uses not included in our agreed-upon contract.’
The county expressed disappointment over Rockwood’s lack of compliance with contract requirements despite efforts to collaborate in resolving the issues.
Consequently, the county deemed it necessary to hold Rockwood accountable by terminating the partnership.
In reaction to the county’s decision, Rockwood CDC provided a contrasting perspective on the situation.
Spokeswoman Savannah Carreno asserted that a recent policy change at the county altered the interpretation of funding, which initially covered broader operational costs beyond just the designated emergency rooms.
According to Carreno, the county’s narrowing of the funding scope significantly hindered Rockwood’s ability to meet essential operational costs necessary for maintaining the facility’s safety and quality.
Brad Ketch, chief executive of Rockwood CDC, expressed disappointment regarding the county’s retroactive changes to the funding agreement.
Ketch stated that the changes have imposed financial challenges on Rockwood, leading to uncertainty for the families they serve, but reassured their commitment to providing stable housing opportunities.
Currently, the county is housing 37 families at the Rockwood facility and plans to relocate them to motel rooms temporarily until alternative housing arrangements are finalized.
According to the county’s memo, Rockwood CDC has displayed a consistent pattern of invoicing the county for expenses outside the agreed-upon contract.
Further, Rockwood did not obtain competitive bids for large purchases, nor did it seek necessary pre-approval for expenses amounting to $5,000 or more as mandated by county policy.
In one instance, Rockwood sought reimbursement for payments made to a subcontractor for services rendered for several months, but the county found discrepancies regarding reimbursements related to these service payments.
Moreover, the county noted that Rockwood billed for expenses associated with a building acquired under Project Turnkey, a state initiative aimed at converting hotels and motels into housing.
As the situation unfolds, Multnomah County aims to ensure fiscal responsibility and transparency in its partnerships with nonprofit service providers.
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