It Gets Worse At Kaua‘i Food Bank
Wednesday - August 17, 2011
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Del.icio.usLast week I wrote about serious problems inside the old Kaua’i Food Bank (KFB), which was dumped-for-cause by the statewide Hawaii Foodbank but continues to operate at Nawiliwili as the “Kaua’i Independent Food Bank.”
The volumes of documents I’ve reviewed for that piece and for this follow-up story make me wonder how KIFB continues to exist, especially under its same leadership that mismanaged grants, charged agencies up to $1.65 per pound of food (the Hawaii Foodbank doesn’t charge anything) and funneled grant money to its for-profit Kaua’i Fresh subsidiary at up to a 40 percent markup (Weinberg Grant Audit.)
I’d have shut the place down as inefficient and in violation of grant rules. But it keeps on going like that Energizer Bunny.
The statewide Hawaii Foodbank (HFB) made every effort to salvage the KFB, even though it had an annualized cash shortfall of $90,664 (10/10/94 audit).
When KFB no longer met Hawaii Foodbank affiliation rules, HFB paid off all its debts, sold all its inventory for $1 and agreed to let it stay on as a contract agency. But things got worse, and even that association was ended.
Donors such as the Wilcox and Weinberg foundations really need to look at the history of how Kaua’i Independent Food Bank has been spending their money. It’s not always through supermarkets. No, it’s often through KIFB’s own for-profit subsidiary called Kaua’i Fresh, which sold food to KIFB at a gross profit as much as 40 percent.
When the USDA discovered its grant was being funneled that way, it demanded the whole $779,000 back and got it money that never made it to the needy on Kaua’i.
Why the Kaua’i board of directors didn’t dump executive director Judith Lenthall as soon as these problems surfaced is a puzzlement. It is paying her $84,000 a year. You generally do not maintain a CEO once damaging financial problems are identified.
The Kaua’i Food Bank argument that it was left in the lurch and in debt by Hawaii Foodbank severance is not supported by the documents I’ve reviewed. In fact, HFB went out of its way to support KFB. HFB interim president Jack Stern wrote in November of 1994 that “it is our intent to provide our very best support to the Kaua’i Food Bank during the transition period and beyond.”
My read of the documents is that the Kaua’i Independent Food Bank became self-destructive with its management policies, bled its treasury of money, kept too many people on payroll and did not recognize the shortcomings of its executive director. It chose to push on regardless.
This is a nonprofit, not a business with shareholders. The reasonable action by its board of directors would be to close it down.
Kaua’i is now fully served by the statewide Hawaii Foodbank, an affiliate of the national Feeding America organization.
Keeping KIFB open should invite audits from the IRS, the U.S. Attorney’s Office and the state Consumer Protection office.
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