Family Shelter Struggles to Get Back on Its Feet

The Rio Hondo Temporary Home, one of the area’s few shelters for homeless families, is trying to weather some hard times of its own.

Shelter officials are far behind their fund-raising goals this year. They have recently initiated an aggressive fund-raising campaign, which includes asking six area cities for $190,000. The cities already provide the shelter with $110,000 a year.

Rio Hondo officials blame former Executive Director Michael Elias for many of the shelter’s financial problems. The shelter’s board of directors fired Elias last April after he failed to account for about $10,000 in shelter money. Donations slowed to a trickle after that, said Barbara E. McMahon, who became the shelter’s new executive director last October.

A Sheriff’s Department investigation of Elias, who has denied any wrongdoing, is pending, Sgt. Barbara White said.

“There was adverse press (chronicling Elias’ firing),” McMahon said. “There must have been people who thought, ‘Why am I contributing to this if funds aren’t being properly spent?”’

So far, Santa Fe Springs, Whittier and Pico Rivera have decided to contribute an additional $95,000 in all to keep the shelter afloat. Downey City Council members last week decided the city could not afford to boost its support from $15,000 to $50,000 a year.

The Norwalk and La Mirada city councils have not yet decided if they will contribute.

“We are operating with the bare minimum crew to muddle through this year,” McMahon said. “If we can get five of the six cities to increase their funding, that will buy us time.”

McMahon and 11 other full-time and part-time employees run the shelter, which is on the grounds of the Metropolitan State Hospital. The shelter, founded in 1988, provides temporary housing for about 100 homeless people on any given night.

The center offers free job counseling and training, as well as room and board for 60 days, in most cases. It has 27 bedrooms to serve families, and three dormitories for single men and women. The shelter is usually filled to capacity, officials said.

The shelter, similar to many nonprofit organizations, has always had to stretch to make ends meet. But the shelter’s financial difficulties came to a head last October, when it didn’t have enough money to meet its payroll, McMahon said. The shelter was able to continue operating when Santa Fe Springs stepped in and agreed to pay the employees until Rio Hondo officials could raise more money.

At the time of his firing, Elias admitted in a handwritten letter to the shelter’s board of directors that he had “misused agency funds.” But Elias has maintained that he used an unspecified amount of money to help the homeless, not for personal benefit. He would use shelter funds to place the homeless in motel rooms, for example, if the shelter were full, he said in an interview last week.

“I had used funds for getting the job done of housing homeless people,” Elias said. “I used my own funds. I used Rio Hondo funds, whatever was possible.”

Elias has since repaid about $6,000 to the shelter. The former executive director said he planned to use that money to set up a thrift shop to benefit the shelter. Elias said he is waiting to find out whether he owes the shelter any more money. A shelter audit is pending.

Elias had also fallen short in past fund-raising goals. To compensate, he used about $43,000 in restricted grant money to pay for general operating expenses, McMahon said. The grant was to cover the shelter’s $1,900-a-month lease payment through next January.

The former executive director said he did not remember specifics, but he denied that he improperly used the grant money.

About a week after she was hired, McMahon was forced to tell her board of directors and city officials that the shelter didn’t have enough money to meet payroll.

“The future of the shelter was definitely in question,” she said.

The shelter was to run on a budget of $487,000 this year. The six cities were to provide about a quarter of that with contributions ranging from $10,000 to $30,000. The rest of the money was to come from various grants and local fund-raising.

As of Dec. 31, the shelter had raised $217,000 and spent $170,000, McMahon said.

The additional $95,000 pledged by Santa Fe Springs, Whittier and Pico Rivera will enable the shelter to run on an austerity budget through the end of the year, McMahon said.

The staff is about half the size as it once was, a shelter spokeswoman said, which translates into fewer services for the homeless. Child-care services, for example, are offered 10 hours a day, five days a week. If fund raising goes well, McMahon said, she would like to see child-care services expanded to at least 14 hours a day, seven days a week.

“We’re fighting so hard to keep everything operational,” she said.

To reassure contributors, the city of Santa Fe Springs is providing all accounting services for the shelter at least through the end of the year, McMahon said. The shelter has also hired an independent accounting firm--Moreland & Associates Inc. of Newport Beach--to perform an audit.

“Santa Fe Springs is not going to stand by and let money be misappropriated,” McMahon said.

Nevertheless, doubts exist in the minds of at least some city officials.

Norwalk City Council members postponed their decision on the emergency funding request earlier this month.

“We have some concerns about the center and we’re going to get some reports,” Mayor Luigi A. Vernola said. “We want to tour the place and see what’s going on over there. Is the situation over there stabilized.”

But most city officials said they have confidence in the shelter’s new leadership.

Santa Fe Springs Councilman Al Fuentes sits on the board of directors of the Rio Hondo shelter. Santa Fe Springs has boosted its contribution from $30,000 to $50,000.

“Things like that (the problems with Elias) happen sometimes,” Fuentes said. “You’d never think somebody would take money from the homeless, but it happens.”