SoNoCC looking at NEON’s programs, worried about their common asset

Updated 2:20 p.m. Monday, Dec. 23, to clarify Rilling quote.

NORWALK, Conn. – The ramifications of a possible bankruptcy for a South Norwalk-based regional anti-poverty agency have sparked concerns of its neighbor, whose leaders are moving to be ready to pick up the pieces – even as they worry that they will be able to remain in the building the two agencies share.

After Norwalk Economic Opportunity Now (NEON) board members said last week that they are considering bankruptcy for the non-profit, South Norwalk Community Center (SoNoCC) spokesman Pat Ferrandino said he was concerned about the status of 98 South Main St., a building deeded to both entities by the city. He also warned of a back-door deal in the works among state and federal officials regarding NEON’s programs.

The bankruptcy possibility also has concerned Norwalk Mayor Harry Rilling. While NEON is based in Norwalk, the agency merged with Stamford’s CTE last year and its current leadership is heavily weighted toward Stamford, including acting CEO and President Tommie Jackson, Board of Directors Chairman Mike Berkoff and influential board member Jack O’Dea. Rilling said Sunday that Norwalk officials would like to see Stamford take care of Stamford, and Norwalk take care of Norwalk.

“We would like to focus more on the Norwalk Community Action Program, focusing on Norwalk issues and Stamford will focus on Stamford issues. We think that’s an important step we believe should be taken,” he said.

There are two paths available to NEON for a bankruptcy, according to eHow: Chapter 7 or Chapter 11. Chapter 11 would allow NEON to continue its services as it reorganizes, while under Chapter 7, NEON would cease operations and sell its assets, the website says.

Neither NEON nor SoNoCC could use the building as an asset in a financial transaction according to the stipulations of the deed, Ferrandino said. But he had other concerns.

“From what I understand, if NEON were to go Chapter 7, the NEON name goes away and the entity goes away,” Ferrandino said. “However, the services that are being provided may end up being reincarnated in the form of a new CAP (Community Action Program) agency. We are very concerned that this isn’t a bait and switch and that the creditors are being duped and scammed out of their money with the cooperation and encouragement of state or federal officials.”

While NEON couldn’t use the building to pay debts, there was another issue, he said.

“We are not clear because there is a stipulation that if one of the two entities ceases to continue to provide social services, the building reverts back to the city. … If NEON declares Chapter 7, they have ceased to provide social services, so they have breached the stipulations of the deed of the building,” he said.

Rilling has offered assurances that SoNoCC would not be negatively affected by a breach from NEON, he said.

Speaking to NancyOnNorwalk Sunday, Rilling said no one knows yet what will happen with NEON.

“There’s always ways to work things out,” he said. “We’re certainly not going to turn our back on any Community Action Program (CAP). We are going to do what we can to facilitate a good relationship so that the people who need services will have those services available.”

State Sen. Bob Duff (D-Norwalk) struck a similar note in an email.

“There are on-going discussions to ensure social service programs continue to be delivered in Norwalk and Stamford. It’s too early to say how that will look in the future. The most important concern is that our residents’ needs are met,” he wrote.

NEON board Chairman Mike Berkoff said Saturday that options for bankruptcy are being discussed.

“Right now the decision is to keep NEON open and operate as possible for the consumers,” he said. “We will not allow bankruptcy unless there is a local CAP agency in lower Fairfield County that will serve as NEON is designed to serve the community.”

“There are certain programs that NEON currently operates that are not available to other agencies or nonprofits, such as the South Norwalk Community Center, because of the Community Action status that NEON enjoys,” Ferrandino said. “… The playing field should be left open for all agencies that can provide diligent services to the community in need, should be allowed an opportunity to provide those services, should not be restricted from doing so versus back-door relationships made with state or federal government.”

On Sunday, Ferrandino said the board of directors had done some research and taken action, voting Sunday morning to become a Community Action Agency (CAA) agency.

“(Monday) we are making an application for a Community Action Agency through the national association,” he said. “We meet the criteria of a Community Action Agency and we are looking to assume some of the programs that have been neglected.”