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Nonprofit Execs Gave Themselves $200K in Taxpayer-Funded 'Bonuses'

By Murray Weiss | February 22, 2016 10:27am
 Mayor Bill de Blasio gave an upadate on the Legionnaires' Disease outbreak in the South Bronx. Health Commissioner Dr. Mary Basset is to his right and Council Speaker Melissa Mark-Viverito is on his left.
Mayor Bill de Blasio gave an upadate on the Legionnaires' Disease outbreak in the South Bronx. Health Commissioner Dr. Mary Basset is to his right and Council Speaker Melissa Mark-Viverito is on his left.
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DNAinfo/Jeff Mays

MANHATTAN — Top officials at a Manhattan nonprofit gave themselves hundreds of thousand dollars in “bonuses” at the same time they were failing to deliver on a $4.3 million contract to carry out one of Mayor Bill de Blasio’s signature initiatives to bring community health care to city housing projects, a DNAinfo New York investigation has found.

The city’s Department of Health yanked its three-year contract with the Northern Manhattan Perinatal Partnership (NMPP) last November after just one year — but that did not stop its executive director and his top aides from taking bonuses that virtually doubled their salaries.

Mario Drummonds, the long-time NMPP chief, raked in at least $71,300 in additional “bonus” pay during the year his taxpayer-funded not-for-profit was supposed to realize de Blasio’s initiative to create a network of “community health care workers” at five city projects in Harlem that would provide at least 1,000 needy residents with medical assistance.

Financial records obtained by DNAinfo New York show in last June alone Drummonds, whose base salary was $65,458, received four “bonus” checks of $8,000, $19,000, $23,400 and $3,400 — totaling $54,800 of the $71,300. He received another $16,500 the previous December.

Various checks were marked “bonus approved board” on internal payroll records. And corresponding “Accounts Payable Vouchers” signed by either Drummonds or his top aides also showed the “Reason for Request: Salaries bonuses approved by Board.”

Drummonds, who did not return requests for comment, was not alone in receiving bonus payouts.

The NMPP’s chief financial officer raked in even more than Drummonds between December 2014 and last July — collecting at least $87,000. The payments included a string of five bonus checks last summer worth $56,800 on top of $30,200 just seven months earlier, the records show.

The nonprofit’s Human Resources administrator also took in at least $23,900 in “bonus” payments, and her niece, who served as Drummonds' secretary, received $20,000, the financial records show.

In all, the quartet divvied up roughly $200,000 between December 2014 and last July, according to the documents.

And sources say they believe bonus monies have been paid to the top execs for at least the last seven years.

Taxpayer dollars cannot be used for bonus payments and certainly not without seeking permission, according to officials at several city and state agencies that have millions of dollars in contracts with the NMPP.

While it is difficult to pinpoint precisely where all the bonus money came from, two “personal action forms,” dated Dec. 16, 2014 and signed by the nonprofit's Human Administration officers, show that city Department of Health and Mental Hygiene funds earmarked for an “infant mortality reduction initiative” were used to pay bonuses to Drummonds and his CFO.

One form instructs Drummonds to receive $13,000 “from the IMRI (infant mortality reduction initiative) project” in three “installments.”  The other personal action form orders NMPP's chief financial officer, Diomedes Carrasco, to “receive $20,000 from the IMRI project” in four $5,000 checks.

Messages left at Carrasco's office seeking comment were not returned.  When reached on the phone, he declined to comment.

Officials at the city’s Health Department — which has been giving the NMPP about $260,000 a year in City Council discretionary funds since 2001 for its infant mortality program and bumped that amount to at least $724,787 since de Blasio took office — said their contracts specifically state that the city has to be notified if a vendor is even considering paying a bonus and explain why. This was not done.

“Bonuses are not allowed,” a DOH spokesman said, adding that contracts are paid on a rolling basis after “documentation is produced” that shows the work has been done.  Any unused monies can be reclaimed by the city.

City records show the Health Department also has been funding another nonprofit since 2001 with roughly $300,000-a-year for an “infant mortality reduction initiative.”

That nonprofit, the Federation of County Networks, lists Drummonds as “treasurer” and was located, until last year, down the hall from his old NMPP office on the third floor of 127 W. 127th St., according to filings with the State Attorney General’s Bureau of Charities, the U.S. Internal Revenue Service, and city records.

Those documents also show that the Federation's director moved the agency to a desk rented from another nonprofit she operates, the Caribbean Women's Health Association, at 3512 Church Ave., Brooklyn.

Sydney Moshette Jr., who serves as the NMPP’s vice chairman and chairman of the Federation, told “On the Inside” that he was unaware that any bonuses were paid to executive staff.

“'Bonus' is your word,” he said, explaining that he believed any additional salary payouts were for “administrative costs.”

Told that the NMPP invoices show payments described as “bonus approved board,” he said he would have to speak with the nonprofit’s chief fiscal officer, Carrasco, and get back to DNAinfo with clarity.  He did not, even after DNAinfo's “On the Inside” left several messages at his home.

Moshette did, however, explain that the Federation serves an an umbrella organization for the various perinatals around the city, which provide the hands-on counseling and care for young mothers and children.

He said the Federation coordinates and shares information among the various perinatals and serves as “an advocacy group” with the city to get funding for them.

The spokesman for the city’s Health Department said the fact that the two nonprofits existed on the same floor with shared executive staff for a decade and a half did not “necessarily mean that they worked in the same office or shared resources.”

But he said the DOH would now re-examine the contracts and the groups’ relationships to ensure that city monies were neither mingled between them nor misused.

In addition to the Department of Health, the city’s Administration for Children's Services has a $10 million, four-year contract for “Early Learning Service” with the NMPP, along with the Department of Education, which has a $600,000 three-year contract for “Pre-Kindergarten Services.”

One NMPP personal action form showed $10,000 from the “Early Learn Program” was paid to the nonprofit's Human Resource administrator in “3 installments, $4,000, $3,000, $3,000.”

A spokesman for the ACS said its “funds could not be used” for bonuses. “The reimbursement funds we give to Early Learn providers who run our programs is highly regulated and based on enrollment in their facilities.”

The city Department of Education spokesman agreed.

“Any pre-K provider using DOE funds to pay themselves or their staff bonuses would be in violation of their contract,” the spokesman said, pointing out “providers are required to submit biannual expenditure reports” to show how money is spent.

As for the state funding, a spokesman for the state’s Office of Children and Family Services, which has a five-year $3.27 million contact with the NMPP for a “Healthy Families” program, said his agency “does not permit” the use of “state funds for the purpose of awarding bonuses.”

“If a program is alleged to be misusing state funds, OCFS will thoroughly investigate and move to recover any misappropriated taxpayer money,” he said.

A spokesman for the state Health Department, which has a $3.15 million five-year contract with the NMPP to provide “maternal and Infant community health assistance," did not respond to a request for comment.

Ashanti Chimerunga, who succeeded Drummonds last November as the head of NMPP, declined to speak with “On the Inside” even after a formal request in writing. She did, however, issue a memo to the nonprofit’s staff instructing them not to speak with the press.

Created in 1991, the Northern Manhattan Perinatal Partnership was formed to assist young mothers and children at a time when infant death rates in Harlem were among the nation’s highest. At its peak, it had four sites and more than 120 employees and, over the years, received nearly $50 million in city contracts.

De Blasio and Health Commissioner Dr. Mary Bassett announced the mayor's “community health care workers” initiative in May 2014, describing it as the “centerpiece” of an overarching health strategy to bridge the gap between health providers and needy New Yorkers. He modeled the “project on a program he initially witnessed in Nicaragua in 1988 while serving as a 26-year-old volunteer," sources familiar with the program told “On the Inside.”

The project was formally awarded to Drummonds in September 2014, and was paid for with City Council discretionary funds.

“On the Inside” initially reported on Drummonds and the NMPP in April 2014, revealing that Drummonds tried to cover up his hiring of career criminal Daniel Rodriguez — without conducting a background check — as a case manager.

Rodriguez preyed upon the women he was hired to help, fathering a child with one and nearly costing another her children to foster care, as DNAinfo previously reported.

When the women came forward about Rodriguez, Drummonds told them to keep quiet and let Rodriguez go without alerting authorities. That decision helped Rodriguez move on to victimize other women here and in at least three other states — Connecticut, Massachusetts and Maryland.

Rodriguez's present whereabouts are unknown.

DNAinfo New York disclosed last November that the city axed its $4.35 million contract with the NMPP, and that it was transferred to another nonprofit, the Fund for Public Health, where Bassett is president and chairwoman of the board of directors, and which is controlled by the city's Health Department.