No easy fix for releasing $1.4 million in frozen funds, says speaker; but expansion of free-lunch program is unaffected.
Although officials are gravely concerned about frozen funds for the poor during a city and state investigation of alleged fraud in the Metropolitan Council on Jewish Poverty, there is no short-term solution in sight, says City Council Speaker Christine Quinn.
“We’re very concerned about the impact,” Quinn told The Jewish Week in an interview (see page 1). “The money goes to some very small JCCs and very small groups out there who don’t have any other money … People will starve. I’m not being melodramatic. That’s the reality here.”
Quinn, who regularly steers funds to Met Council as part of the member-item process, said all the facts in the case must come out before it can be determined when the money will be cleared for disbursement.
“As long as the contracts are held, it will be a challenge to get emergency funding, unless the [contracting city] agencies and authorities find some ways to separate things out or some higher level of verification, a monitor or auditor or something.”
The city’s Department of Investigation ordered about $1.4 million in funds frozen pending a state and city probe of William Rapfogel, Met Council’s longtime executive director, who was fired Aug. 12 amid reports of a kickback scheme involving an insurance provider. Met Council itself reported the financial irregularities discovered by its board to the state attorney general, triggering the probe.
David Frankel, currently the city’s finance commissioner, has been named to replace Rapfogel beginning Sept. 30.
Rapfogel has apologized for his “mistakes,” without specifying them in a statement issued through his lawyer. Investigators reportedly are looking at whether he overpaid for insurance and steered the extra money to political donations. Quinn and others have returned funds tied to the insurer, Century Coverage, of Valley Stream, L.I.
Quinn said there is “a real desire on the part of the Bloomberg administration and the authorities not to penalize innocent people. So, is there some way to separate funds out in a way that at least gets some money moving quickly and roll it out? … I know those are the questions they are looking at and answering right now.”
The investigation covers at least 30 grants that make up approximately 13 percent of the Met Council’s annual government aid, including more than $100,000 for crisis intervention services; $36,500 for the group’s food aid program; $155,000 for its domestic violence services and a $600,000 grant for general operating funds.
Quinn said she did not doubt Frankel’s ability to right the ship at Met Council, but was concerned that he did not have the nonprofit experience to run the organization as Rapfogel did for more than 20 years, to acclaim until the scandal broke.
“I’m not sure the political savvy is the critical thing at this time,” she said. “He can give government, the foundation world, the philanthropic world the sense that there are tight controls. He probably is the right person for that … Does he have the nonprofit skills, that I just don’t know.”
A spokesman for state Comptroller Tom DiNapoli told The Jewish Week there are no state contracts under review from Met Council. “We will examine [past] contracts and payments to Met Council closely, “ said the spokesman, Eric Sumberg.
Meanwhile, the scandal did not stop Met Council from expanding a kosher-lunch program offered last week.
Met Council, together with the Jewish Education Project and the New York City Department of Education, and with the support of several local nonprofits and elected officials, provided 4,000 free kosher lunches to school-age children from low-income families from Aug. 19 through Aug. 22.
Launched last summer, the Summer Meals program addresses the weeklong gap between camp and the start of school, a period when children previously lacked access to federally subsidized kosher meals.
Meals were delivered to children in the Williamsburg, Crown Heights and Borough Park neighborhoods of Brooklyn. Last year, Summer Meals operated only in Williamsburg and Borough Park and served approximately 3,000 meals.
Asked if the investigation of Rapfogel affected the Summer Meals program, Met Council Communications Manager Rena Resnick said in an e-mail that the program “does not involve city funding.”
In addition to the federal school-lunch funds, a private foundation that wishes to remain anonymous donated money covering the extra cost of providing kosher food, Resnick said.
In a statement issued before the food distribution, Steven Price, president of the board of Met Council said, “We were thrilled with the success of Summer Meals last year and look forward to expanding its reach this year and in years to come.”
Adam Dickter is assistant managing editor. Julie Wiener is an associate editor. Staff Writer Stewart Ain and JTA also contributed to this report.
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