Posted on May 4, 2011

Urban League’s Financial Crisis Worsens; Acting CEO Out

Jim Brunner, Seattle Times, May 2, 2011

The Urban League of Metropolitan Seattle is facing a withering financial crisis–and may even sell its longtime headquarters–in the wake of the recent Seattle schools scandal.

The venerable civil-rights nonprofit recently parted ways with acting Chief Executive Tony Benjamin, the second top leader to leave this year.

At the same time, the Urban League has shuttered its once-praised small-business contracting center, which had received millions of dollars in government contracts over the past nine years to assist minority and women-owned businesses.

Having already made significant layoffs, the Urban League is considering the sale of its headquarters at East Yesler Way and 14th Avenue, according to a statement released Monday by the board of directors.

Benjamin’s sudden departure came last month, as the board decided to close its Contractor Development and Competitiveness Center (CDCC), which Benjamin had managed.


Monday’s statement from the board said the nonprofit was “moving in a new direction in terms of leadership” and would hire a new leader “as soon as we have stabilized the organization and found additional funding sources.”


Board Chairman Paul Chiles initially agreed to an interview with a Seattle Times reporter Monday morning. But Chiles canceled the interview a half-hour before it was to begin.


Benjamin’s departure closely followed the resignation of James Kelly, longtime president and chief executive, who stepped down in January, citing personal and health concerns. {snip}

Kelly’s exit came about a month before the eruption of the Seattle Public Schools’ scandal, which centered on waste and possible fraud in the school district’s small-business program run by Silas W. Potter Jr.

Potter’s program had been set up to help minority-owned firms get school-construction work. But a state audit found evidence the program may have wasted $1.8 million in public money. A criminal investigation is under way.

The Urban League was the single largest recipient, receiving nearly $600,000 in school-district contracts that auditors labeled “questionable uses of public funds.” The money was to pay for minority-business outreach and training–a specialty of the Urban League’s CDCC.

But auditors criticized the Urban League’s invoices as vague, and some district employees told investigators the spending did not benefit the school district.


One of the Urban League’s benefactors had been the city of Seattle, which under former Mayor Greg Nickels had awarded it a succession of contracts.

The city spent nearly $4 million on the CDCC between 2002 and 2011, to assist women-and-minority owned firms to compete for city work.

The Urban League got a separate $500,000-a-year contract from the city to combat youth violence starting in 2009, after a rash of fatal shootings in Southeast Seattle.

In the last year, Mayor Mike McGinn sought competitive bids for the contracts. As a result, the Urban League lost its youth-violence contract to other nonprofits this year.