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The Next Generation Community Development Corporation, a nonprofit organization founded by longtime NAACP President Jerome Whyatt Mondesire in 1999, has presented itself, at different times, as different things.
According to one contract, it was a job training center for women on welfare. Elsewhere, it was described as a mortgage program for low-income and first-time home buyers. One donor understood it to be a program for children experiencing domestic violence. At other times, it was merely a way for donors to make tax-deductible donations to the Philadelphia NAACP.
Nowadays, the organization isn’t presenting itself as much of anything at all.
Officially defunct since its nonprofit status was automatically revoked in 2010 after not filing tax forms since 2005, the Next Generation CDC — whatever it is at this point — is mired in debt, threatened with foreclosure and back utility bills, and under increasing scrutiny in the escalating controversy over how Mondesire has handled or mishandled the Philadelphia NAACP’s finances.
Last fall, after a meeting during which local NAACP members voiced concern over the fact that the heat had been cut off at their headquarters on Cecil B. Moore Ave (owned by Next Generation CDC), more than 20 members of the local branch signed a petition asking the national NAACP to intervene and audit the group’s books. In December, AxisPhilly published that petition along with a letter detailing questions about the group’s finances and their connection to the Next Generation CDC.
Three of the group’s elected officers, Sid Booker, Donald “Ducky” Birts, and Rev. Elisha B. Morris, have since gone public (and to the District Attorney’s Office and Attorney General) with the claim that Mondesire has been diverting money meant for the NAACP to the Next Generation CDC, which they say he controls. Despite having been listed as board members themselves at times, the men now say they had no actual involvement in the CDC or its finances.
Two weeks ago, AxisPhilly published copies of two checks, both made out to the NAACP — one for a youth scholarship program, the other for a contribution by Booker to the group’s annual gala — which were deposited instead in a Next Generation bank account.
Mondesire, who has repeatedly declined to speak with AxisPhilly, has dismissed these claims. But he’s given only vague, even contradicting answers to the question increasingly at the heart of this conflict: What exactly is the Next Generation CDC?
Loans on top of loans
In 1999, in the same letter in which Mondesire announced his intention to purchase a headquarters for the Philadelphia NAACP, he announced the creation of a new organization, the “Next Generation CDC,” with an ambitious stated agenda to provide job training for mothers on welfare, give business training to high school students, offer housing loans, and purchase two properties for the NAACP to use as permanent headquarters.
Over the next few years, Next Generation purchased two properties: the building at 1619 Cecil B. Moore that would become the NAACP headquarters, and a building at 6661 Germantown Ave, which came to house Mondesire’s private business publishing the weekly newpaper, the Sunday Sun. The properties were bought for $1 each from the Philadelphia Redevelopment Authority.
Throughout the time it’s owned the properties, the Next Generation CDC has taken out multiple large open-ended mortgages on both, in some cases from lenders with civic or charitable missions, often satisfying one loan shortly after taking out another. All were signed by Mondesire; some, but not all, were signed by Next Generation treasurer Harriett Garrett.
In August, 2002, while at least one of those loans was still outstanding, Mondesire took out yet another loan, this time mortgaging both the Germantown Ave property and the NAACP headquarters on Cecil B. Moore Ave for $172,000, from the Mellon Bank Community Development Corporation, a subsidiary of BNY Mellon Bank. By 2006, loan documents, referring to another “credit application” in the interim, stated a total debt of $237,000.
That debt appears to never have been paid off. In November, after years of unpaid real estate taxes, the Germantown Ave. property was listed for sheriff’s sale. It was pulled from auction only when Mellon Bank stepped in and paid the delinquent taxes, apparently in order to be able to foreclose on the property itself. A spokesman says the bank intends to sell the property to a third party.
A contract gone bad.
The CDC does appear to have had, at least at times, staff, programming, and income as an independent nonprofit.
At some point, the Next Generation CDC received a contract through the now-defunct Philadelphia Workforce Development Corporation to provide career training for women on welfare. It appears to have lasted until 2005, the last year for which the Next Generation CDC would ever file required federal 990 disclosure forms.
That year, it reported over $500,000 in revenue, over $600,000 in program expenses, and over $800,000 in net assets. It described its mission as “to train and motivate unemployed and unskilled workers and develop community and neighborhoods through housing and stimulating the area economy.”
The tax documents reveal little more about the nonprofit, but some details emerge in state documents accusing former Next Generation treasurer, Harriet Garrett, and her daughter, Yvette Gimenez, of using public money for personal benefit. Both pled guilty to reduced charges.
According to a 2010 grand jury presentment, Next Generation signed its welfare-to-work contract over in 2005 to another nonprofit run by Garrett, who the presentment describes as a “partner” with Mondesire in the Next Generation venture. Mondesire, meanwhile, was listed as Chairman of the board of Garrett’s nonprofit, Creative Urban Educational Systems (C.U.E.S.).
It was after that, the indictment says, that Garrett began to spend public money on a car for herself, improperly billed the state for materials, and used contract money to purchase students copies of a book, “Coyote,” that her husband had written.
Some of the money Garrett allegedly abused came from “excess” funds in the Next Generation CDC bank account — funds which Next Generation was supposed to have returned to the state and didn’t, the presentment said.
The document makes no suggestion of impropriety on the part of Mondesire, who was president of the Next Generation and chairman of C.U.E.S. throughout this time — but it highlights the degree to which the identity of Next Generation itself seemed to blur: Officials administering the welfare-to-work contract, the presentment says, “believed C.U.E.S. to be the same organization” as the Next Generation, “the only difference being the name.”
Payable to Next Generation
Perhaps the most perplexing role Next Generation CDC — and the most controversial right now — is its nebulous connection to the Philadelphia NAACP.
After the recent allegations that Mondesire had diverted money meant for the NAACP to the Next Generation CDC, Mondesire gave a rare interview to the Philadelphia Tribune, in which he claimed the Next Generation CDC, “has nothing to do with the NAACP,” except for owning its headquarters — but also said that it had served as a way for donors to receive tax breaks, since local NAACP branches are not themselves independent nonprofits.
As Mondesire told the Tribune: “Have people given checks to that corporation in order to get a tax write-off? A few did, over the years. But no large sums of money, no” — a statement seemingly contradicted by the $10,000 check to the NAACP AxisPhilly recently reported being desposited in the Next Generation bank account.
Other documents reviewed by AxisPhilly further indicate that the Next Generation CDC has been much closer to the local NAACP finances than Mondesire’s characterization suggests: At times, the Next Generation has presented itself as almost indistinguishable from the NAACP — especially when it came to collecting donations.
In 2004, on the eve of the NAACP national convention in Philadelphia, then-NAACP president Kweisi Mfume accused Mondesire of going behind the organization’s back to collect donations for the national convention himself.
Mfume invoked a “Letter of Understanding,” a copy of which AxisPhilly has reviewed, Mondesire had signed just months prior agreeing to coordinate all fundraising for the convention with the national office. Instead, Mfume wrote, Mondesire had solicited donations from local corporations.
He included as evidence a copy of a letter, written by then Philadephia Chamber of Commerce CEO Mark Schweiker to Comcast CEO Brian Roberts, asking the latter to buy a “sponsorship” package for the national convention, noting that the Philadelphia NAACP has its own tax-exempt 501(c)3 foundation.
Mfume ordered Mondesire to cease such fundraising immediately telling him, in another letter, that “it is against the policy of the NAACP for branches to operate their own [tax-exempt] organizations … therefore the branch is in violation.”
This did not apparently stop Mondesire: copies of a dozen invoices, provided by lawyers for the dissident NAACP board members, show solicitations to various corporations and groups – the Philadephia Phillies, K-Mart, Ikea, SouthWest Airlines, PNC Bank, and others – for “sponsorships for the NAACP National Convention.”
The invoices appear on letterhead bearing the name “NAACP/Next Generation CDC.”
Below that: “Make contributions payable to: Next Generation CDC.”
It’s unclear whether or how much of these solicitations were collected, and then whether or how much went eventually into the NAACP’s, rather than Next Generation CDC’s bank accounts.
It’s also unclear whether donors were aware to which entity they were making contributions.
The Verizon Foundation, which listed the “NAACP Next Generation CDC” as one of many recipients of charitable donations in 2007, acknowledged writing a $20,000 to the Next Generation CDC . The money, says spokeswoman Ellen Yu, was “to support a youth intervention program to help students who witness domestic violence” – yet another incarnation of the nebulous nonprofit.
Last week, City Paper reported that the Next Generation CDC received $16,000 since 2009 from the Philadelphia City Council “Special Activities Fund,” even after it lost nonprofit status.
The Philadephia NAACP, meanwhile, appears to be in a state of serious financial distress. A review of recent bank statements shows near-zero or negative balances, overdraft fees, and late payment charges.
Next Generation CDC, what’s left of it, appears in distress as well. The city has sued a half dozen times over gas claims and unpaid taxes on its properties, including the NAACP headquarters. The Mt. Airy Business District has sued for unpaid assessments; and the city recently acknowledged to AxisPhilly that the real estate tax exemption Next Generation had enjoyed as a nonprofit will be no more in 2014 — even as the taxes themselves more than doubled under the city’s new tax assessments.
Whatever it was, the Next Generation CDC now appears to be little more than a name, a bank account, a mounting pile of bills — and an ongoing mystery.