Look familiar?
That’s Ken Keenan, the CEO of Beacon Hills homeless shelter.
In early June, the Washington Post released the results of a Secret Service audit showing that Keenan and his staff were collecting more than $20 million over five years in compensation, rent and tax breaks.
According to the audit, several Beacon Hills employees received bonuses of up to $55,000 each. The employees also received tens of thousands of dollars in taxable benefits, including health benefits, debit card withdrawals and $14,000 of rent payments.
For example, Henry Jones, the director of business development, collected a $24,500 bonus. He also received $55,000 in taxable benefits.
According to the audit, Keenan — who filed several tax returns, including a 2009 return that included an adjusted gross income of $127,000 — never even reported the housing payments he received through the nonprofit.
No further investigation was conducted. But Mimi Szeliga, the executive director for the Washington Regional Homelessness Initiative, admitted that the nonprofit did not use tax information the appropriate way. The charity committed to pay about $200,000 into a Social Security trust fund.
“The check is made out to the Social Security Administration, it’s not as if they would need it,” she said.
It’s not clear if the executive management team at Beacon Hills have been disciplined, and they declined CNN’s request for an interview. But the fundraising arm has no new donors, and the pool of clients continues to shrink.
“We’re unable to honor all of our donor commitments because we have been insolvent,” said Hixson King, the director of fund development.
According to the audit, Beacon Hills was moving three beds a day, and had difficulty keeping the facility’s actual staff in place.
But the survival of the Beacon Hills High-Ceiling Homeless Shelter is a testament to the kind of commitment from the state that Washington, D.C., leaders say can’t be scaled down. In 2010, Washington, D.C., passed legislation that makes it legal for nonprofits to pay themselves millions. The law even allows nonprofits to borrow money in exchange for their executives selling stock, which is even easier when the stock is valued at more than $1 million.
According to paperwork filed by Beacon Hills, the nonprofit has at least one executive left with a golden parachute that values $8 million.
“The amount Beacon Homes Stadium provides in tax advantages for the sale of their bonds is not, nor will it ever be, substantial enough to explain away Beacon Homes Stadium’s values and the extravagance that has taken place in their fundraising,” said David Storrs, senior policy counsel for Common Cause.
According to Storrs, this kind of lavish spending may be common in states like Texas, Mississippi and Florida, where when nonprofit execs are collecting millions, the public and investors are not aware of it.
When the Washington DC mayor’s office asked questions about Beacon Hills on Twitter, they got a response that showed the organization’s no-holds-barred spending policy. “Of course the disparity in top salaries is at its greatest at Beacon Hills, our focus on people is our highest priority and philanthropy continues to be our greatest operational expense,” spokesperson Megan Ives said.