Nonprofits using public money need closer outside oversight

Governments in Massachusetts use a labyrinth of nonprofit agencies to carry out a host of public needs — from special education to poverty relief — but the failure to regulate some of these agencies has become a sad, familiar story in the state. The latest chapter involves a Somerville anti-poverty program.

Back in 2010, a state review found serious weaknesses in the basic fiscal management of the Community Action Agency of Somerville. But no one did anything to address the questions swirling around the agency, which receives $5.6 million in state and federal funding to run Head Start programs in Somerville and Cambridge.

A federal review of Head Start this spring found deficiencies in accounting practices. That finally inspired the agency's board to have independent accountants examine its books. Their audit identified numerous financial irregularities, including more than 100 personal credit card charges made by the agency's executive director, Kimberly Smith-Cofield. Other agency officials were also making purchases on the agency's credit card without providing receipts.

In the wake of the findings, Smith-Cofield and director of finance Jeff Karon departed. An interim director was named. In October, the board chairman and three other board members resigned. The current board president, Sonja Daral, insists the problems are being addressed. But this contention provides little reassurance — especially when the interim director is already facing criticism over the way she runs the program and treats employees. This program needs a fresh start and independent new leadership.

From this and other scandals, it's clear that nonprofits receiving public funding need closer scrutiny from the federal, state, and local officials who contract with them. Somerville Mayor Joseph A. Curtatone has proposed one reform: an ordinance that would require nonprofits that receive city money — a category that would include the Community Action Agency — to abide by the city's conflict-of-interest and ethics disclosure rules. But the Board of Aldermen has yet to act on the measure. Besides, the burden shouldn't fall only on the city; the state is in a more powerful position to ensure that nonprofits operate with the same transparency and professionalism taxpayers demand of their government.

So why didn't the 2010 findings trigger action by the state? The state Department of Housing and Community Development is belatedly conducting its own audit. Where has it been for two years? That's a question Governor Deval Patrick should be asking. The citizens of Massachusetts deserve an answer.