By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
Cleo Sims, executive director of the government-supported anti-poverty agency, set up her daughter, a convicted cocaine dealer, with a $25,000-a-year contract to manage two agency apartments in drug-infested parts of South Dallas.
She put her son to work under a property maintenance agreement.
And she has the state asking, among other things, where all the money went in a $443,000 renovation of a 10-unit South Dallas apartment complex for the homeless.
A yet-to-be-released state audit obtained by the Dallas Observer raises questions about the Sims family connections and suggests waste and possible corruption at the $1.9-million-a-year nonprofit corporation, which employs 29.
DCCAC, which provides the poor and homeless with housing, rental assistance, and computer training, has somehow kept its doors open for more than 30 years despite being rocked every decade or so with major scandal. In the late '80s, before Sims took control, things got so bad that a judge appointed a receiver to run the agency. Employees were caught paying their own electric bills with money meant for the poor.
The Texas Department of Housing and Community Affairs' latest review of the agency's three government programs, dated July 9, gives Sims 30 days to respond to the state's questions about agency finances, but several DCCAC board members say they are satisfied with Sims' responses.
In an interview this week, Sims provided documents that appear to allay some of the state's concerns about misuse of funds. But she acknowledged that her daughter and son received DCCAC contracts--an apparent breach of federal rules on nepotism and conflict of interest. DCCAC gets more than 75 percent of its budget from the government; the rest comes from rents, donations, and sales at two thrift stores and a restaurant.
"We're gonna work on that at the next board meeting," DCCAC board president Ivey Givens said when asked about the Sims family contracts. Charles Hunter, who stepped down from the board presidency in February after seven years in the post, says he approved hiring Sims' daughter but did not know of her criminal background.
The state auditing team sent to Dallas on May 22 turned up federal tax forms showing that Bridgett Griffin, who is Cleo Sims' 27-year-old daughter, received $25,683 last year as a contractor for DCCAC.
Sims' agency hired Griffin as manager for two apartment complexes, the Meadows Apartments and Ewing Place Apartments, Sims says. The Meadows Apartments, located east of Fair Park on Meadow Street, are largely boarded up, run-down units that the agency purchased two years ago.
State auditors nailed down the arrangement between mother and daughter by noting that Griffin and Sims at one time shared the same address: 9715 Springtree Lane in Dallas.
County court records show that the daughter was arrested in Dallas on three counts of delivery of cocaine in 1994. She pleaded no contest and was found guilty last August. She received 10 years' probation and a $750 fine.
"I love my daughter dearly and unconditionally," Sims says. "I do what I can to assist my kids to become better folk. I didn't hide it [her daughter's criminal background] from Dr. Hunter. I talked to him about it, and he saw no problems in trying to assist her. She needed a job.
"I don't think you will find anyone at the Meadows who will say she engaged in or allowed the practice of dealing drugs."
The state audit also reveals that Griffin signed invoices for a company called Ocean Port Services, which Sims acknowledged to the Observer is actually her son Harvey Scott.
DCCAC's agreement with Ocean Port for 1995 set out a modest fee schedule--$25 per yard for mowing and $50 a day for maintenance work. Sims was unable to immediately provide records of how much Ocean Port was paid.
Ocean Port Services also was given the job of picking up items donated to DCCAC, although the state noted that a staff employee already was assigned to do that work.
Sims also says that another son, Gary Sims, was paid to do some manual labor for the agency.
The director says the agency has terminated her kids' contracts on the advice of its attorney, although tenants at the Meadows said Tuesday that Scott was there as recently as Monday.
Sims says she believes her daughter's contract was not a violation of federal policy because the two apartment projects get absolutely no government money--a statement also contradicted by tenants' accounts.
Several say the federal government pays half their rent to DCCAC under the Section 8 program.
Of perhaps greatest concern to the state, auditors noted that a DCCAC project called the Point Apartments, 10 units at 1803 E. Grand Ave., are already deteriorating and only 60 percent occupied just three years after the state provided $443,377 to renovate them.
DCCAC acquired the building as a donation from an insurance company; the rehab money--amounting to a $300,000 loan and a $143,000 grant--came through the state's Housing Trust Fund program. "Because of the severity of the condition of the property in relation to the short amount of time which has elapsed since rehabilitation and the amount of investment per unit, the Department questions the entire amount of the award," the state report concludes. In plain language, the state wonders whether the renovations add up to anything near the amount of the grant.
Sims says state officials inspected the project at the outset, approved the budget, and were there when it opened. "If they felt it was overpriced, they should have come in 1993 and said so. They have to stop throwing rocks and hiding the chickens," she says.
Thus far, the state concluded, DCCAC has not provided supporting documentation for $127,569 supposedly spent on the renovation. The amount is part of the first draw of grant money.
Sims says that the first draw of money was paid to the general contractor, Charles Roberson, and that a second draw was not released until the state approved the first.
A visual inspection of the little two-story red and white apartment building "raises questions as to the type, the extent, and the quality of rehabilitation completed as well as the costs associated with the scope of the work," the state found.
The state inspectors listed the use of cheap plywood flooring and the fact that the railing on the second story balcony--which looks to be nothing more than nailed-on cedar fencing--had already fallen off. Some new fencing appears to have been recently nailed up. Other parts of the balcony are weathered two-by-fours. Leaks in the plumbing and unsafe flooring in the five second-story units also hinted at the cheap quality of the renovation.
Roberson could not be reached for comment.
DCCAC was also unable to show the state whether it put the job out for bids, the review found.
Sims says that tenants in the one-bedroom, approximately 500-square-foot units have been unemployed homeless men who at times have hauled off televisions and other items and sold them across the street for drugs. The agency now uses the building to house homeless women.
She says DCCAC is current on its mortgage payments, even though rents, set at about $345 per apartment, don't cover expenses.
The audit also questioned $14,446 in DCCAC checks paid to director Sims, including a $1,747 payroll advance, payments for items purchased and then returned, and hotel charges.
The review alleges that Sims routinely failed to supply documentation of travel expenses for which she was reimbursed: $159 in January 1996; $616 in May 1996; $262 in June 1996; $252 in August 1996; $934 in September 1996; $249 in October 1996; $289 in November 1996; and $321 in December 1996.
Sims says the state auditors did not check the agency's detailed travel files for those items. She showed the Observer files of specific expenses, requested at random, that appear to put the state's concerns to rest. "There's no misappropriation of funds going on here," Sims insisted.
A trip to San Francisco in early September, for instance, coincided with the National Association of Community Action Agency's Annual Conference, held at the San Francisco Hilton Hotel. Sims says approval by then-president Hunter constituted board approval of the trip, which the state said in its audit was lacking.
DCCAC assistant finance director Patty Wright produced receipts for a $319 air conditioner the state alleges was purchased and returned, without the money returning to the account. The paperwork showed that an air conditioner was returned, then another one purchased. Wright says the first one was defective.
Sam Guzman, administrative director for the Texas Department of Housing and Community Affairs, would not discuss the unreleased report, but says the agency "has 30 days to respond and may clear up a lot of these things."
He says that his department was responding to complaints about the program, but that the review of those complaints was done in the course of a routine annual monitoring visit. If major problems go unanswered, the department has an array of sanctions available, from demanding reimbursement to terminating programs.
Board president Givens says he is satisfied with Sims' explanations of the travel and expense items. "She's not a thief," he says.
Sims says the agency board president and other board members, not her, sign checks for the agency. The impression the audit report gives "couldn't be further from the truth," according to Sims, who says she is paid about $60,000 a year. "My car is a 1988 falling-apart car that falls down every other week. Everybody who knows me knows I don't steal, and I've done the very best I can to make sure that doesn't go on here. We don't have petty cash. We don't accept cash for rents. Our checks are done in sequence, and there's never a missing check.
"If you believed the idiots out there, I wouldn't be driving a car that falls down once a week," she adds.
Sims' reference was to a group of men who have challenged her and her allies on the board over the past seven monts, going so far as to attempt a coup at the agency's February meeting.
About a half-dozen men came forward with letters from public officials appointing them to the board. The board, protecting Sims, rejected the appointments.
Charges of wrongdoing erupted at the same time as the fight to control the board.
"Cleo Sims feels she can control the agency by controlling the board, but people like myself thought otherwise," says Ken Green, a board member in the early '90s whose attempt to regain a seat this spring was rebuffed. "We were trying to get on the board to right these wrongs."
In the latest round of board squabbling, the panel voted last week to oust member Khaleef Rasad Hasan, who was appointed last year by Dallas City Councilman Al Lipscomb.
Hasan was "disruptive and rude," Givens says, and the board voted to ask Lipscomb to appoint another member.
"It's unbelievable," says Hasan. "I thought Sims was a brilliant lady, but when I started digging and asking questions, the whole relationship changed."
The 21-member board--made up of members appointed by public officials and private and community groups--had numerous vacancies at the beginning of 1997. The state alleges the board nevertheless held meetings and conducted business without a quorum.
Among other items questioned in the audit are $4,200 in cellular phone bills Sims ran up last year, charges the state deemed "excessive unless they can be justified." Sims says that she is reviewing those charges, and that perhaps $100 were personal calls she intends to reimburse.
Hunter and four other agency employees also were provided cellular phones, and their charges were paid with federal money, the audit found. Long-running collect phone calls from the same phone numbers also were found on the agency's phone bill.
Also, the DCCAC listed expenditures of $9,792 in 1996 and $7,970 in 1997 for fundraising, but the state couldn't find any evidence of the proceeds going back into the coffers. Sims says the account was used for the agency's annual banquet, which raises no funds.
The audit also turned up what appear to be instances of sloppy management, but Sims insists those appearances are deceiving.
DCCAC paid more than $4,000 in bounced-check charges in 1996 and the first four months of 1997, and $6,084 in penalties and fines, the audit found.
Sims and assistant finance director Wright say the bounced-check charges accrued because the state has been as much as three months late in sending grant checks.
"The only time we had any returned checks was when the state told us the money was on the way, and a week later we're still looking for it," Wright says.
Dallas Observer intern Rebeca Rodriguez contributed to this story.