By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
Joe Granados, one of the nonprofit's top administrators, was told to return two watches that reportedly had been donated as raffle items for a fund-raiser. The attorney general ordered Casita's board to stop making loans to anyone and required Lucio and Granados to resign from the board. Casita Maria, the attorney general concluded, is "a viable and worthy ongoing nonprofit enterprise and...there is a need in the community for the mission services provided by Casita Maria."
When the Morning News first began investigating Casita Maria, it was, financially speaking, a "seat-of-the-pants" organization, says Garrett Vogel, an accountant appointed by a probate judge in Austin late last year to monitor the charity's finances. Vogel applied for, and received, a temporary restraining order to ensure that Lucio, Granados and Maria Briones, another chief administrator, would not meddle in financial reforms he was trying to bring about. That move prompted "something of a war," Vogel admits, between the three administrators and himself. He eventually fired all of them.
But even Vogel acknowledges that "in my opinion, the financial questions about Casita Maria were more one of form than of substance." Casita Maria tended to earn between half a million and a million dollars a year, but its finances were run as if it were a mom-and-pop store. "When I came in, they could not tell you how many people they had seen the preceding day, much less the preceding year," Vogel says. That makes it impossible to craft a budget. Many days, Casita Maria would take in $5,000 in cash and stick it in the safe. "There was probably nothing that was inappropriate if it had been properly documented," Vogel says. The problem was something known as Founder's Syndrome. "The people who founded it think that they had an entitlement," Vogel says, "and, without going through proper board approval and documentation of transactions, lend themselves money or pay themselves bonuses that they characterized as different things at different times. The amounts were not huge."
Founder's Syndrome is "very common in charities," says Sommerville, an Arlington lawyer who specializes in nonprofit clients. Founders of charities are sometimes "so passionate about the mission that they tend to blur those lines between themselves and the organization because their vision and hard work created the organization."
"Well, yeah, and you can kind of see why," says Michael Thomas, the attorney for Lucio and Briones. "...You've got a priest who [has dedicated] his whole life and Maria Briones--that was her whole life, too," Thomas says. "It's unfortunate to know that a guy that's done what he's done has to scramble to make money...but the law is the law, and you've got to cross your T's and dot your I's or you're not entitled to things."
Sommerville points out that Lucio never had any training in running a nonprofit or any kind of business. Lucio acknowledges that he relied on experts in the subjects he knew nothing about (like accounting). But "the evidence that I saw shows that those individuals did not give him proper guidance," Sommerville says. "So how can you expect him to know the law when the people who he hires to teach him the law don't teach him the law?" When Lucio was told by the attorney general to step off the board of Casita Maria and begin to pay back the $18,000, he did. "If he had hired the right people in 1989 and stuck with them," Sommerville says, "this never could have happened."
If a charity tells the IRS that it spent $141,000 on cars in one year, it certainly may look like the charity had "assembled a small fleet of automobiles." But Sommerville says "the preparer for 2001 was totally incompetent...Every time [Casita] purchased a new automobile, they added it to the books, but they never took the old ones off, so you ended up with $141,000 on the books, but that's not real and never was real." In the charity's 2002 return, the mistakes made in the 2001 return were corrected, and the $141,000 figure had decreased to $33,000. "Father had a 6-year-old car with 100,000 miles on it; Joe Granados had a Chevy Yukon SUV," Vogel says. "Whether or not it's the business of a charity to provide its officers with vehicles is one question, but it's not like they had 20 to 30 late-model sports cars they were driving around in; it was for basic transportation."
When the same person is called both a saint and a monster, it is natural to assume that either his supporters or his detractors are employing rhetorical hyperbole. There is a little of that in the case of Lucio: Newspapers, like people, can exaggerate, and Donnelly may feel the need to emphasize Lucio's good qualities because all the recent news about him has been negative. The confounding thing about Lucio, though, is the range of divergent reactions he inspires: People admire him or they revile him, but it is rare to find someone who has a mild opinion of him.