State emails show that top officials in the Oregon Department of Human Services knew about neglected children and serious financial problems at Portland foster care provider Give Us This Day—and did nothing for nearly 19 months.
The Oregon Department of Justice shut down Give Us This Day in September, after a WW investigation revealed allegations of neglect and documented serious financial problems at the provider ("Home Sweet Hustle," WW, Sept. 16, 2015).
But emails show that regulators at DHS—the agency that monitors and pays for the care of more than 10,000 foster children in Oregon—knew about allegations of neglect early last year, and brought the problems to the state agency's director.
"We need to bring you up to date on the full breadth of issues with this program," DHS child welfare director Lois Day wrote to then-DHS director Erinn Kelley-Siel on Jan. 31, 2014. "There are three bodies of information that intersect: the abuse investigations, the licensing issues and the financial issues."
All three were sufficiently serious that Day said she wanted to get on Kelley-Siel's calendar "quickly."
Yet it would be more than 18 months before the state forced Give Us This Day out of business—with no help from DHS.
In the intervening months, former employees say, hundreds of children the state entrusted to Give Us This Day often went hungry and received minimal care. And in that time, DHS paid Give Us This Day more than $1.5 million, much of which the DOJ says the organization's executive director, Mary Holden, either wasted or spent for her personal benefit.
Kelley-Siel resigned in July, and Gov. Kate Brown named her deputy, Jerry Waybrant, to replace her. Emails show both were regularly informed of problems at Give Us This Day.
Waybrant tells WW that DHS continued to place children with Give Us This Day, despite numerous warning signals, because the state agency's divisions weren't well-coordinated. Once a foster care agency opens, he says, it's very difficult for the state to close it.
Waybrant says Give Us This Day's financial woes didn't automatically mean children were in danger.
"We had ongoing concerns," Waybrant says. "But I'm drawing a distinction between their business practices and child safety."
Observers say the department's inaction is baffling.
"I don't understand why Give Us This Day wasn't shut down a long time ago," says state Sen. Sara Gelser (D-Corvallis), chairwoman of the Senate Human Services Committee.
DHS recently turned over 457 pages of emails in response to a public records request by WW.
They show Kelley-Siel and Waybrant were informed of a "sustained allegation of abuse" against Give Us This Day in February 2014 (a "sustained" allegation is one that has been substantiated by investigators).
That same month, they also learned of a raft of new financial problems that threatened to push Give Us This Day into bankruptcy.
In March 2014, emails show, top DHS management received information about financial issues Give Us This Day faced: An employee had garnished $150,000 from the provider; the Internal Revenue Service was preparing to seize more than $100,000 for unpaid payroll taxes; and Multnomah County wanted $53,000 in unpaid property taxes.
"This is another solvency issue we need to address," a DHS staffer told Kelley-Siel in a March 10, 2014, email. (Kelley-Siel did not return WW's calls.)
Emails show Kelley-Siel and Waybrant soon learned the DOJ was digging into Give Us This Day's finances. A nonprofit, GUTD depended on state payments to fund its operations.
On Sept. 11, 2014, an entire year before forcing Give Us This Day to close, the DOJ requested a meeting with DHS "to discuss the current investigation into GUTD's use of charitable funds."
On Sept. 26, 2014, Waybrant emailed Kelly-Siel's assistant, seeking to "find a time on Erinn's busy schedule to discuss GUTD's status and the recent information we received from DOJ."
In November and December 2014, emails show, WW, KPTV Channel 12 and KATU-TV Channel 2 all approached DHS with questions about Give Us This Day not paying foster parents.
The agency brushed off those concerns and continued its uniquely lenient treatment of Holden, regularly paying her organization in advance for work it had not substantiated—a privilege officials say DHS extended to no other foster care provider.
By February 2015, the DOJ had substantially finished its investigation, and it shared in writing with the organization details of Holden's waste or diversion for personal use of $2 million during the previous five years: trips to Jamaica, Hawaii and Las Vegas; hundreds of thousands of dollars in improvements to her West Linn home; and tens of thousands spent on cosmetic treatments, lingerie and luggage.
Waybrant says those details came as a shock, but he didn't learn of them until September.
The potential consequences of that diversion of funds for foster children were obvious: If Give Us This Day was so broke or mismanaged that it couldn't or wouldn't pay its taxes or employees, how could it provide adequate care for children?
Yet DHS continued to refer foster children to Give Us This Day until Sept. 15, the eve of WW's cover story about the provider.
Waybrant says DHS is conducting an audit to see how things went so wrong.
"I'm horrified," Waybrant says. "The kids weren't served, and what happened is not acceptable."