{ "id": "2006-july-august-program-for-disabled-misses-the-mark", "slug": "2006-july-august-program-for-disabled-misses-the-mark", "url": "https://dwillis.github.io/uplink/article/2006-july-august-program-for-disabled-misses-the-mark.html", "year": 2006, "month": "July-August", "monthNum": 7, "headline": "Program for disabled misses the mark", "kicker": "SPOTLIGHT: ON THE JOB", "author_name": "Tom Detzel", "author_title": "Investigations Editor", "affiliation": "The Oregonian", "summary": "The Oregonian investigated the Javits-Wagner-O'Day program, uncovering that charities were redefining disability and overpaying executives while mismanaging federal contracts.", "keywords": [ "disability", "federal contracts", "nonprofits" ], "topics": [ "Investigative Methods", "Data & Databases", "Business & Economy" ], "technologies": [ "Excel", "Access", "Nexis", "Dun & Bradstreet", "Guidestar Premium" ], "full_text": "Our stories on nonprofits that employ severely disabled workers sparked an FBI investigation and calls for reform of a little-known federal contracting program that spent $2.25 billion last year, much of it on military goods and services. For these stories, simple databases produced profound results. The Javits-Wagner-O'Day program sets aside government business for charities that mainly employ workers who are blind or severely disabled. But our reporting found that nonprofits were increasingly using workers with mild or questionable disabilities. The biggest contractor, the National Center for the Employment of the Disabled in El Paso, Texas, repeatedly failed to document that it was using enough disabled labor. And it had paid the management firm run by its president a stunning $8.7 million over two years. Although much of our information came from sources inside the charities themselves, reporters Jeff Kosseff, Bryan Denson and Les Zaitz used the federal Freedom of Information Act and Internal Revenue Service charity disclosure forms (Form 990) to get a grasp of overall trends in the program and target specific charities for investigation. Kosseff used FOIA to obtain five years of annual reports from the 627 charities. The reports, kept by a tiny federal agency (Committee for Purchase from People Who are Blind or Severely Disabled) that oversees the program, contained data on annual sales, wages paid to the disabled, and the hours worked on federal contracts. When he received the data in a Microsoft Excel spreadsheet, it was immediately clear that the bulk of the contracts went to the 50 largest charities. We decided to focus our reporting on this group, which the data showed had tremendous revenue growth since 9/11. Denson wanted to know the impact of the wars in Afghanistan and Iraq. He looked up the Dun & Bradstreet D-U-N-S nine-digit identification numbers of each of the 50 contractors, punched them into a spreadsheet and sent them to the Defense Department, asking for a list of their military contracts. The Pentagon can find contracting records quickly if you provide a contractor's D-U-N-S. You can find these numbers online on Nexis, Hoover's and other sites. The Pentagon turned the request around in two days. We then had a list of every defense contract for each charity over five years, detailing contract amounts and the type of goods or services provided. The bulk of the growth had indeed come from a burst in military spending. Defense business was only part of the picture. What about other sources of income – contracts from local governments and private firms – for the charities? And how could we measure whether workers or charities managers were benefiting? To get aggregate numbers, Denson turned to the charities' tax forms. Gail Hulden, the newsroom's head researcher, used Guidestar Premium to acquire 990s from the top 50 charities for 2000 and 2003. We built a data entry form in Microsoft Access, and Denson and two copy aides began the painstaking process of building and proofing a database. The information they punched into the database included the 9-digit employee identification number (EIN); the tax return year; the name of the nonprofit; the total amount of government contributions; total revenue; total expenses; net assets; officer compensation; total salaries and wages; other wages; related income; and four-year income. This data allowed us to measure growth in all categories. In a access form, they focused on payments to charity officials, entering total compensation for up to five officers, five employees and five contractors paid $50,000 or more. In all, they entered and verified the names, compensation totals and deferred compensation totals for 1,165 officers, employees and subcontractors. Denson also flagged any insider or related-party transactions noted on the forms for follow-up reporting. In the case of the National Center for the Employment of the Disabled, they were numerous enough to lead us to add a reporter to the project and look hard at the charity's president. We later added 2004 data when it became available. It allowed us to report that average compensation for top executives at the 50 biggest charities grew three times faster than hourly wages for their disabled workers. At least a dozen execs pulled in $350,000 a year or more in pay and benefits, while many workers were paid less than minimum wage. The management firm run by Bob Jones, who ran the El Paso nonprofit, had received $14 million in charity payments over five years and loaned millions more to other businesses in which Jones had an interest. Records we requested under FOIA, plus documents from internal charity sources, showed that the charity had repeatedly been unable to document its workers' disabilities. Many were counted as disabled because they spoke little or no English. Jones resigned the day our story about him appeared under the headline: \"Texas charity a launchpad for entrepreneur's empire.\" He is now under investigation by the FBI, the IRS and the Texas attorney general's office. Our first-day story about weak oversight of the contracting program, \"Charity leaders prosper as 'disabled' is redefined,\" prompted calls on Capitol Hill for an overhaul of the Javits-Wagner-O'Day program. It also sparked an intense and ongoing debate within the community of nonprofits that serve the disabled. The stories and accompanying slide shows can be found online at www.oregonlive.com/special/disability.", "provenance": { "extracted_by": "pre-v2", "extracted_at": "", "verified": true }, "similar": [ { "slug": "2006-september-october-federal-contracts", "score": 0.244 }, { "slug": "2006-july-august-bits-and-bytes", "score": 0.157 }, { "slug": "1996-january-bits-bytes-and-barks", "score": 0.15 }, { "slug": "2001-septemberoctober-tax-breaks", "score": 0.134 }, { "slug": "2007-januaryfebruary-ny-power-agency-gives-dollar1-million-to-leaders-pet-projects-charities", "score": 0.128 } ], "html_url": "https://dwillis.github.io/uplink/article/2006-july-august-program-for-disabled-misses-the-mark.html", "json_url": "https://dwillis.github.io/uplink/article/2006-july-august-program-for-disabled-misses-the-mark.json" }