City officials say Social Development Commission is reorganizing, vendors reimbursed; unpaid employee payrolls being addressed

Officials from the city, the Social Development Commission (SDC) and SDC counsel updated the Finance & Personnel Committee Jan. 15 on the status of city funding, outstanding payments and the commission’s reorganization.

Sponsor Alderwoman Melele Cox said the communication was meant to check that previously allocated funds were spent as intended and to learn whether SDC remained able to provide contracted services. City CDGA director Mario Higgins said multiple funding streams to SDC — including CDBG, HOME and ARPA allocations — were reprogrammed when SDC became unable to carry out certain work. "Those funds were reallocated during the that cycle," Higgins said, listing allocations that were redirected to other agencies, including Housing Resources, United Community Center and Habitat for Humanity for homebuyer counseling and energy-efficiency work.

Higgins said SDC’s 2024 allocations (excluding ARPA) aggregated to about $877,000 and that the ARPA allocation (a $350,000 housing trust fund award made in 2022) was part of reprogramming actions taken in 2024. He said earlier council action (file 240391) allocated some funds originally assigned to SDC to other organizations.

City attorneys and DOA staff said the city has not issued new payments to SDC since early 2024 and had contracted a technical assistance provider and a technical assistance review. Steven Mahan, DOA deputy director, said a technical assistance report has not yet been released. "As of today, the person that you have on, the attorney will probably give the most up to date information," he said.

SDC’s counsel, William Sultan, and SDC interim leadership described steps SDC has taken to resume operations. Sultan said SDC created and is executing a quality improvement plan, "SDC did reopen its doors and is working on getting back to full capacity. SDC does have employees that are working. SDC is running programs, and SDC is seeking funding to help get back up to capacity." He said most staff owed for the April 15, 2024 payroll were paid, with one payroll outstanding. He said employees had filed claims with the Wisconsin Department of Workforce Development’s Labor Standards Bureau; SDC supplied payroll information to the Department and Sultan said he expected outstanding staff pay to be cleared "by the end of February." He added that SDC is more than 95% grant‑restricted funding: money granted for one program cannot legally be used to pay obligations for another.

DOA and SDC board director Jackie Carter (appointed by the mayor) described remaining board vacancies — the board then had five members with several openings — and said weekly meetings with the State Department of Children and Families were ongoing to restore SDC’s community action agency (CAA) status.

Deputy Commissioner Tyler Weber from the health department said the city reviewed SDC contracts and reimbursed contractors who had unpaid invoicing for lead-abatement/energy-efficiency work. The environmental collaboration office confirmed it invoiced and paid about $2,762.97 under a $700,000 contract before canceling the balance and reassigning $500,000 to Habitat for Humanity and $200,000 to a city energy program. Health department staff said a total of about $7.8 million in ARPA funds had been associated with SDC programs historically, with $44 units completed under one contract; outstanding contractor invoices were investigated and resolved.

Committee members asked who should be the city contact for follow‑up. SDC counsel Sultan said he would remain a point of contact. The committee moved to place the communication on file.