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Social Service Agency Failing
February 19, 2006 permalink
Family Services Hamilton is facing bankruptcy and may shut down. The FSH website, one of those with nothing but smiling faces, may disappear from the internet soon.
Family Services shutting down
Bankruptcy rescue attempt fails
A rescue attempt to keep financially-indebted Family Services Hamilton afloat has failed and the non-profit community agency is heading for bankruptcy.
About 66 employees will lose their jobs when the agency shuts down -- perhaps as early as next week.
Family Services Hamilton (FSH) provides counselling for victims of abuse and domestic violence, day care for about 30 troubled pre-schoolers, a housing help program and a money-losing day care centre.
FSH, which dates back to 1923, has faced deadlines and ultimatums from its main funders in past months to come up with new business and debt-reduction plans to resolve its ongoing financial crisis.
The three main funders, the city, the Ontario Community and Social Services Ministry and the United Way, have stressed, however, that contingency plans were in place to have alternative agencies look after the people helped by Family Services.
"It's unfortunate that the agency has been unable to address its serious financial and governance issues," said ministry spokesman Paul Doig. "We are taking steps to ensure the continuity and delivery of service."
Linda Dayler, executive director of Catholic Family Services of Hamilton-Wentworth, said her agency is prepared to help any FSH clients as early as Monday.
FSH's latest crisis came to a head Thursday when Mac Carson, the new president of the agency's board of directors, was ousted by the other directors.
"I learned a lot, mainly never try to help somebody; when they are drowning, you can't do much to pull them out," he said.
Carson, a former Hamilton-Wentworth Region chief administrative officer, said he had been working on a bankruptcy protection plan, extension of funding and other rescue efforts but they were rejected by directors when there was finally a quorum for a "hectic" meeting Thursday.
"The board voted no confidence in me," he said. " I tried several things but they didn't want to take the road I suggested."
The board then voted to go into bankruptcy, Carson said.
LaFerne Clarke, the executive director of FSH, could not be reached for comment.
Carson said he scurried about in past weeks to improve the cash flow at FSH but bills piled up and there was currently only enough money to pay employee wages up to yesterday.
"Everybody got paid today but nobody got severance pay which I think is disgusting," he said yesterday.
Carson blamed the agency's problems on inadequate management and a governing board of directors that was seldom able to meet quorum requirements and take action.
"We couldn't do anything but go into bankruptcy," he said. "There was no leadership and co-operation inside."
Carson, who joined the board in past weeks, said the three main funders gave the agency every possible chance to survive. "They tried far beyond the call of duty to keep the organization going."
Family services has a current deficit of about $100,000 including a $19,000 payment due next week to the receiver-general of Canada. FSH has a total debt of about $800,000.
In past years and months, Family Services Hamilton has experienced tumultuous and fractious board of directors meetings and resignations of directors.
In addition to its funded day care program for troubled preschoolers, the agency provides fee-for-service employee assistance programs.Its other for-profit day care program is losing money and was set up with $200,000 in borrowed money.
The agency provides housing subsidies for about two dozen families but lost provincial funding for its second-stage housing program a decade ago and was unable to make up the lost funds.
Dayler at Catholic Family Services said workers from her agency would be available at 905-527-3823, ext. 269 to assist any FSH clients Monday or at 447 Main Street East, Unit 201.
Pointed out by K Karolak