This group was supposed to help L.A. tackle poverty head-on. Instead, it’s shutting down

Youth Policy Institute, the L.A.-based nonprofit known for its anti-poverty programs and its fundraising prowess, announced Friday it is closing its doors, eliminating nearly a thousand jobs and leaving services for some of L.A.’s neediest families in serious doubt.

Interim Chief Executive Dan Grunfeld, hired just last month as part of an effort to save the organization, said he and the board of directors had made the “incredibly difficult” decision to shutter the decades-old nonprofit at the end of Friday.

“We have explored every option, but in the end, we have realized that we cannot keep it going,” Grunfeld wrote to Youth Policy Institute’s employees. “I wish this were not so.”

Grunfeld said his organization had reached agreements to transfer after-school programs on 80 campuses to another group, the Santa Ana-based nonprofit Think Together. The move should allow at least 400 of the group’s full- and part-time workers to remain employed, albeit with another organization, he said.

Nonprofit executives are also hoping to safeguard other after-school programs, although details have not been finalized.

Friday’s announcement brought an astonishing end to Youth Policy Institute, which had wooed politicians, grabbed headlines and secured tens of millions of dollars for after-school programs, job training, tax preparation and other services targeting low-income families.

The nonprofit thrived under the Obama administration, which provided funding for programs in and around Hollywood and in parts of the San Fernando Valley. The organization was promoted frequently by Mayor Eric Garcetti, who was a regular at its annual fundraising gala.

Last week, the group received a devastating audit that found lax oversight, inaccurate financial reports and a grim budget outlook. The group had been under fire for months from the federal Department of Education, which had withheld nearly $6 million from the organization’s signature programs.

Fred Ali, president and CEO of the Weingart Foundation, said he had never seen a nonprofit group in Southern California grow to such a size and then fall apart so quickly. The lesson of Youth Policy Institute, he said, is that nonprofits need effective oversight as they expand their operations.

“You have to have sound internal controls. You have to have strong financial management systems. And you have to have effective governance,” said Ali, whose group distributes grants across Southern California, including to Youth Policy Institute.

Dixon Slingerland, who was terminated last month as Youth Policy Institute’s top executive, repeatedly attributed the group’s financial woes to cuts by the Trump administration, saying federal officials had used “compliance and oversight to make everyone’s life miserable.”

Federal officials, in turn, called Slingerland’s remarks politically motivated, saying the group had poor financial controls and was badly run.

Garcetti voiced dismay over Youth Policy Institute’s demise on Friday, saying it had helped students complete high school, get into college and overcome poverty.

“It is a huge tragedy to see mismanagement shut down something that has been an engine of opportunity inside the city,” he said in an interview.

Slingerland, who earned $400,000 a year, could not be reached for comment. But Deputy Supt. Megan Reilly of the Los Angeles Unified School District said she was disappointed with the nonprofit’s decision, saying the district received no advance warning. “We’re trying to continue the services so that those programs will not have a break in service,” she said.

Youth Policy Institute had strong connections at many Los Angeles-area schools. But one of the deepest was with the Bernstein High School campus in Hollywood and its independently run STEM Academy. The campus falls within a Promise Neighborhood, a federally established zone eligible for “wraparound” services to meet the broad needs of low-income families.

The school’s academic counseling room was essentially staffed by the nonprofit. On one poster are the names of 25 students who have submitted their applications to California State University campuses with the help of a counselor funded by Youth Policy Institute. Seventy-five are still in process.

Paul Hirsch, principal at the STEM Academy, called Friday’s announcement “reckless” and said he hopes L.A. Unified will preserve the nonprofit’s programs.

“We’ve been partners with them for seven years and they’ve done amazing things for us in so many capacities: after-school support, tutoring, college counseling, helping with other partnerships,” he said.

At least two of the nonprofit’s workers came to the school Friday, even after learning that they were losing their jobs — and would not be paid for this week’s work.

“If I say I’m going to be here Monday through Friday, I’m going to be here Monday through Friday,” said Amy Rubinstein, who taught art and yoga.

Grunfeld said he considered the nonprofit’s “in the field” employees — those working at schools and in community centers — to be heroes. He informed them of the group’s closure in an email Friday morning, although at least some were told a day earlier.

Bryan Aguilar, an academic tutor, said he and his colleagues learned during a Thursday afternoon conference call that “effective immediately, we were all terminated.”

Aguilar said he was upset about losing his job — and the disruption facing the low-income students served by the nonprofit.

“The fact that these tutoring programs are up and leaving just adds to their instability, and it’s something I wish I wasn’t a part of,” he said.

Youth Policy Institute had a $47-million annual budget and, for years, a triumphal message about its ambitions. “Los Angeles is at the forefront of a new War on Poverty, and this is the sound of the cavalry coming,” Slingerland declared in one announcement in 2015.

Councilwoman Monica Rodriguez, who represents the northeast San Fernando Valley, said her district has an array of programs that had been provided by Youth Policy Institute. She predicted the nonprofit’s closure would have a “ripple effect” across the city.

“It’s devastating for my community. It’s devastating for the city, and I’m angry about it,” she said.