Project JOVE : State Probing S.D.-Based Job Program

Project JOVE, the 13-year-old San Diego-based social service project that assists ex-offenders, veterans and the unemployed, has had some of its state funding suspended and is under state investigation for financial irregularities, officials said Thursday.

Thomas Wornham, JOVE’s executive director, blamed the problems on the falsification of records by two key agency employees who worked in Los Angeles and who have apparently left the country and are reportedly now in Spain. Wornham said the two had been confronted and denied the accusation before leaving the country March 19.

As a result of the funding crisis, $70,000 worth of payroll checks to JOVE’s 160 employees bounced last Friday, and Wornham said Thursday that about 30 JOVE workers here and in other parts of Southern California are “waiting to see what happens” to their checks before they resume work.

Steve Duscha, executive director of the state’s Employment Training Panel, which contracted with Project JOVE, said he believes the organization “owes the panel substantial amounts of money” on two contracts in the Los Angeles area--a $1.25-million contract designed to retrain unemployed workers to repair recreational vehicles in Baldwin Park, and an $896,000 contract to train workers in use of liquid propane in Pico Rivera.

According to Duscha, the irregularities center on the number of people who have actually been trained and received jobs with recreational vehicle dealers and service centers. Under the recreational vehicle training agreement, Project JOVE was to receive $4,995 per trainee if the trainees were placed in jobs that paid at least $7.50 per hour, and if they remained employed there for at least 90 days.

Duscha said “evidence of possible improprieties” was discovered during a routine comparison of statements filed by Project JOVE and employment records of businesses said to have hired trainees. Many of the trainees, it was discovered, were found either to be not working at all or making less than $7.50 an hour.

The state attorney general’s office and the state Employment Development Department are investigating the situation, Duscha said.

Wornham, who acknowledged that his agency is in financial trouble, blamed its woes on the two employees who have apparently left town. “They set up the situation by falsifying records of placement and training hours,” Wornham said.

The two employees did not remove any funds, he said. Rather, they “were trying to be big wheels in the industry.”

By making it appear that the program was more successful than it was, he said, the pair could maintain their salaries and contacts in the recreational vehicle industry while preparing to go into business on their own.

As a consequence of the state’s action, the agency’s cash flow has collapsed, resulting in the bounced payroll checks to 160 employees in projects from San Diego to Los Angeles to Sacramento.

“To date, $2,500 in (my) checks haven’t got paid,” said Al Caro, an instructor in servicing recreational vehicles in the Baldwin Park program.

Wornham said the agency is exploring its options, including filing for bankruptcy. Another JOVE source said the agency’s board of directors is exploring legal action against the employees.

“We have worked with more than 100,000 ex-offenders, and now we have two guys who have jeopardized the program,” he said.

But Wornham also expressed optimism that the situation can be resolved successfully if the agency is able to place recreational vehicle trainees who have not yet found jobs by mid-May. He is also seeking to modify the contract with the state to ease the wage requirements.

Although he blames the two missing employees for the financial troubles, Wornham said he must shoulder some of the responsibility. “I’m responsible for having gotten us into this financial maze,” he said. “The buck stops here. My main concern now is making lemonade out of lemons.”

Project JOVE has outstanding service contracts worth about $6.5 million--57% of which is from the Employment Training Panel. Wornham said Thursday that the other contracts are “running sensationally.”

State officials said the recreational vehicle contract called for about 250 people to be trained, with JOVE initially receiving $3,750 of the $4,995 agreed upon for each student trained. The project was to receive the remainder after successful job placement.

The training classes have already been completed, but Wornham said Thursday that as many as half of the placement papers of trainees may have been falsified.

The liquid propane gas worker program, meanwhile, calls for the training of 280 clients through August, 1986. Duscha, whose 2-year-old agency disburses $55 million a year for retraining programs statewide, said he is “concerned that the trainees (currently undertaking the full-time LPG program) are not abandoned in this process.”

The recreational vehicle training program was JOVE’s attempt to break from a total reliance on government funds and turn a profit on its own. “We were following the clarion call” to offset public sector funding cuts, Wornham said.

JOVE has twice before tried its hand in profit-making ventures. In 1982, JOVE closed its 5-year-old print shop, which was used to train ex-offenders. When several local print shops went out of business, the agency lost its placement market.

And in 1976, JOVE closed a full-service, profit-making Mobil gas station it operated on Pacific Highway across from the County Administration Center after Mobil Corp. and other oil companies began stressing self-serve operations.

In addition to the $3.7 million worth of contracts with the Employment Training Panel, JOVE has $2.8 million in contracts with several other agencies and firms.

JOVE has a $1.3-million contract with the Joint Training Partnership Association for job training for ex-offenders, displaced cannery workers, unemployed youth and others. The agency also has two contracts to weatherize homes of low-income families--a $930,000 contract with San Diego Gas & Electric Co. and a $1.4-million contract with the state’s Office of Economic Opportunity.

The County of San Diego also will pay JOVE $500,000 through 1985 as part of an ex-offender job training and placement contract.

Wornham, 53, is a colorful character with a checkered past.

He served 19 months at the California Institution for Men at Chino after he was found guilty in November, 1972, of six counts of grand theft. Prosecutors charged that Wornham, then a stockbroker, had illegally funneled $85,000 in investors’ funds into other ventures.

Prior to that, Wornham, the son of a former San Diego Marine Corps Recruit Depot commandant, served on the board of governors of the California Community Colleges, an appointee of then-Gov. Ronald Reagan.

He took over JOVE in March, 1975, and since has increased both the budget and stature of the agency.

“He’s a hard worker, and he’s kept a keen eye on the political aspects of the business,” said one San Diego social service agency head who has worked with Wornham for 10 years. “If his agency is in trouble, however, I’m concerned about the gap in services for ex-offenders in San Diego.”

JOVE’s 15-member board is chaired by attorney Alex Landon, executive director of Defenders Inc., a nonprofit, county-funded legal service for low-income clients.