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NEON loses another board member; ex-members fire back at CEO’s ‘liars’ comment

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Norwalk Economic Opportunity Now (NEON) board member Alan Rossi pushes for financial records in August.

NORWALK, Conn. — Another Norwalk Economic Opportunity Now Board of Directors member has chosen to walk away from the agency, the sixth since Sept. 23 and fifth this week, and interim CEO and President Chiquita Stephenson said departing members who have complained about lack of adequate financial reporting are “lying.”

In an email to new NEON board chairman Michael Berkoff at 8:42 p.m. Thursday night, Alan Rossi wrote, “I am hereby resigning from the board of directors of NEON Inc. effective immediately.

“I must say that I am leaving with a sense of disappointment in stark contrast with the optimism that I felt when I volunteered to serve on NEON’s board in March of this year. Back then I felt that as a newly installed board we shared enthusiasm for NEON’s important mission and had the commitment and experience to work with the management team to improve performance levels for the benefit of all the people that need NEON’s services. I also was optimistic that in short order we could address past problems regarding lack of accountability and transparency.

“Instead, I have found in NEON an organization inextricably wedded to flawed management practices where decisions are made in an arbitrary fashion, often in conflict with NEON’s mission. Additionally, and in spite of my repeated requests both oral and written, as a director I never received the information that would have enabled me to assess the Corporation’s financial situation, how resources were used and what outcomes were being achieved. In summary, I have not felt that NEON was receptive to my advice nor was I ever given the information necessary for me to properly fulfill my fiduciary responsibility as a director.”

The resignation is the latest in an exodus that began last summer and accelerated starting Sept. 23, when Board of Directors Chairman William Westcott resigned. That was followed Oct. 3 by members TaShun Bowden-Lewis, Christopher Ruzzi, state Rep Jonathan Steinberg (D-Westport) and Dr. Susan Weinberger, Ed.D. Ruzzi had resigned as treasurer Sept. 27.

Stamford businessman Michael Berkoff was elected chairman Tuesday, Oct. 1, to replace Westcott.

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Most of these people are no longer on the Norwalk Economic Opportunity Now (NEON) board of directors. The picture is from July.

Westcott, Weinberger and Steinberg all were quoted about their inability to fulfill their fiduciary responsibilities because of what they said was poor financial record keeping. All three expressed frustration and their doubts that things would improve. NancyOnNorwalk was not able to contact Bowden-Lewis, and Ruzzi chose not to comment at this time, he said.

Financial record-keeping was at the heart of the problems cited in the Office of Inspector General audit that led to the ouster of former NEON CEO and President Joe Mann, the loss of grants from the city and a demand by the Department of Social Services for the return of more than $300,000 in misspent grant money. Information in that audit has threatened NEON’s administration of Norwalk’s Head Start program.

Late Wednesday and earlier Thursday, Stephenson shared several documents with communications between NEON and federal officials from Health and Human Services and other agencies involved in grants for things such as Head Start. HHS was looking for information to show that NEON had taken action to resolve the many problems found in the 2011 audit by the Office of Inspector General. The documents are attached below.

Many of the problems involved the way NEON handled and accounted for its finances. In a document titled May 9, 2013 Corrective Action Plan, the agency assured HHS that it is continuing efforts to improve financial reporting. In fact, in the first item, it is stated that, in 2012, the new management team has developed a specific plan and timeline to address issues related to financial reporting. This is in response to a recommendation that the finance department improve its procedures related to monthly close and reconciliations.

However, nearly five months after that document was sent, several of the board members who have resigned have cited the lack of timely and complete financial reports despite repeated requests for them as a major reason for their resignations.

Stephenson, who was chief operating officer under Pat Wilson Pheanious when that document was prepared, defended herself against claims by departing board members of poor management by claiming they are lying.

“… My role at NEON prior to my current position was development and public relations. My current role gives me the ability to utilize my skills to move the agency forward. That is why you now have a organization budget, program budgets and cash flows. This information was given to all board members and is continued to be given to board members. Only they can explain why they are lying about being in receipt of financial information. … It is available. It is not pretty but it is reality and now we are focused on moving forward.

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Norwalk Ecomonic Opportunity Now (NEON) board member TaShun Bowden-Lewis laughed frequently at board meetings. She has resigned.

“Some board members left because they were tired of other board members’ treachery and felt that their time could be better spent working with individuals that want to see progress and I respect that. Some left because life responsibilities changed and therefore, their priorities had to change. However, notice they did not leave hostile and focused on hurting children, families and the community. As for others, there is no need for me to comment because they have expressed themselves. I just wish them well and God’s Blessing.”

Weinberger pushed back Thursday night.

“Since my tenure began as a member of the Board of Directors of NEON, the term ‘liar’ has been used repeatedly by management to place blame on others for the agency’s problems. Most recently, it was used to respond to the Head Start report stating major program deficiencies. I suggest that management should eliminate that negative and accusatory term from their vocabulary and instead, concentrate on honesty and transparency.”

Weinberger went on to discuss the financial data supplied by NEON management.

“When financial reports were submitted to the board for review, they were often one page, lacked clarity and were largely incomprehensible. They did not reflect the current financial activity and record keeping that one would expect to find in an organization responsible for managing such a large budget.  Accounting was sloppy, statements of cash flow and profit and loss were lacking, and both raised questions around reliability of the financial data.  Our former treasurer, who recently resigned, reported to the board at several meetings that he could not answer questions about the financials submitted because he had just received them, a few minutes before a board meeting.

“Only when vendors started writing to all board members did I have a better idea of the seriousness of the business at hand. This included major legal fees that have not been paid and promised in the amount of $300,000 from one law firm, money owed to Community Playthings in the amount of $9,375 for furniture shipped to Ben Franklin School or cessation of services on Sept. 1 from the Child Guidance Center due to unpaid bills totaling $8,049.41 under a contract, according to its executive director, for intervention, observations, teaching support and assessment. This information was not forthcoming from the management over a very long time. Minutes of meetings and copies of e-mails from seemingly frustrated vendors state the facts.”

Steinberg also responded to Stephenson’s comments.

“The financial situation was on every board meeting’s agenda, as it should be. However, I think you’d be hard-pressed to find a board director who was not frustrated by the inadequacy of the information presented,” he said. “Cash flow statements which suggested that we had positive cash flow when we knew otherwise. Last minute declarations of emergency to cover the payroll or other obligations. We asked over and over again for a simple accounting of critical obligations going forward. There were always excuses as to why we couldn’t have them.

“As for Ms. Stephenson’s version of what’s transpired, I’m really not going to get involved in proving who is credible. I’m a great believer that the truth will come out, sooner than later. It takes a great deal of energy to keep all these storylines going – blaming everyone but NEON management for the organization’s continual state of crisis, whether it was accusing the Department of Social Services, the Head Start program, contrary board directors, or unpaid vendors. It’s just hard to sustain the contention that everybody else is lying.”

Despite the ongoing problems, Steinberg, who joined the board just 3½ months ago, said he had hoped the new board, installed in May, would be able to get the operation turned around.

“Many board directors hoped we would finally get past the political shenanigans and focus on the critical issues of proper procedure, financial sustainability, and program management,” he said. “But it became clear that it simply wasn’t going to happen. That’s the real story.”

Weinberger said it is time for NEON management to step up and accept the blame for the problems.

“For the children and communities we serve,” she said, “it will be a great step to resolving the many issues facing a troubled agency.

May 9, 2013 Corrective Action Plan

National External Audit Review Response

NEON Letter from Cogley

NEON Response to July 19, 2013 corespondence

Richard Borseti Correspondence

Comments

12 responses to “NEON loses another board member; ex-members fire back at CEO’s ‘liars’ comment”

  1. doug

    Wow – serious crisis

  2. piberman

    Is there any candidate running for office in Norwalk that expressed an interest in NEON and offered suggestions on how to bring NEON back to life ? Maybe we just need to find a new Board giving full allegiance to the new management before retiring from the field as before. Why saddle NEON with a Board that just keeps on quitting from disappointment ?
    Lifetime appointments for management without oversight is the remedy. We really do need to get beyond NEON so we can focus on potholes, bike lanes and the really important stuff.

  3. Oldtimer

    It is not clear how these people got on the NEON board. It is clear they need a real professional manager, with power to hire and fire, and a qualified accountant/bookkeeper with full authority to do the job. Paying these people would be the smartest money they ever spent. Whoever is keeping information from the board needs to be identified and fired.

  4. dawn

    they are not jumping ship. They are clearly stating that they cannot do the job under the current circumstances. They are telling the facts. That the books are wrong and the organization is under improper leadersip. Someone finally stand up and do something.

  5. JustAsking

    I commend the board members that resigned for telling the truth. The entire management team needs to be replaced or the agency disbanded.

  6. Neoscam

    Until there are indictments and prison sentences handed down, we will continue to be fleeced in the name of the children who need it most and who will continue to suffer at the hands of these con artist.

  7. RUBY MC PHERSON

    ALTHOUGH THE AGENCY LOSS CITY FUNDING, KNOQING THEY WERE NOT GETTING IT BACK. COMPASSION FOR THE COMMUNITY IS A NON PROFIT NOT A PAIDED CEO, RETIRED EXCUTIVE WHO KNOW HOW TO RUN AN AGENCY FOR THE COMMUNITY . TO MANY THINGS GOING ON, TAKE CARE OF HEADSTART FIRST, STOP HIRING DIRECTORS WERE THERE IS NO NEED, MOST STAFF TELL ME THEY Have been working on their own anyway everyone (management) live in to many meetings. AIC, ENERGY, MOBILTY,HOUSING,CHILDCARE ONE STEP AT A TIME WITH NEW MANAGEMENT TEAM.

  8. shamed-former-norwalker

    While this type of corruption is not a new story and sadly happens in many towns across America, it’s a source of indescribable shame for this former Norwalker. My deepest respect to the fine folks who not only tried to make a difference by voluntarily serving on the board (with no financial compensation) but recognize the ethical responsibility in communicating the real story to the public. What I want to know from those courageous enough to uncover the facts is: how much money was the CEO and her executive staff receiving in their weekly pay checks while venders, lawyers and service providers were being stiffed and the underserved children in the Head Start program had no food (as Mr. Dumas shockingly reports).

  9. NEON Staff

    Nancy, How about the fact that NO NEON EMPLOYEES received their pay checks after two weeks of work NEON was not able to make payroll, so staff has to wait until Tuesday to get their paychecks. Neon knew since Monday about the situation and waited until 5 pm Thursday to send out an e-mail about not receiving a paycheck until 3 pm Friday so they wait until 2 pm Friday to let staff know we are not getting paid until Tuesday.I feel sorry for the families with no food or gas and NEON’s management staff response to this was oh you’ll be fine.I bet they got their checks.

    Angry & Disgusted
    NEON Staff

    1. Mark Chapman

      @NEON Staff

      We are working on this right now. Nancy went to Ely. Food has been delivered this afternoon. Working on check story, and will post as soon as we get enough info.

  10. Oldtimer

    With all Neon’s problems the merger with CTE seems to have compounded them. A lot of the information board members were looking for should not be that hard to get, unless somebody was hiding something. A simple spreadsheet showing hours and pay for all employees should be easy, for example. It sounds like the board members who quit may have started to wonder what was being hidden, and why.

  11. The Norwalker

    Many of the NEON Employees deserve to be paid on Friday as contracted because their programs are funded and do not have a cash flow problem. I believe the cash issues center around HeadStart.

    Other cash issues center around irregular spending by top management past and present. These issues should be settled in civil court and liens should be placed on the assets and earnings of past and present top management and board members.

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