Community Action of Minneapolis owes nearly $700,000 to contractors and former employees, records show.
The unpaid bills are on top of an alleged $800,000 owed to the state Department of Human Services, after the state agency conducted an audit last year and found financial improprieties, including money spent on lavish trips, cruises, personal loans and other unallowable expenses.
Court-appointed receiver Michael Knight listed all companies and individuals that are owed money. They include CentrAire Inc., which is owed about $182,000. A construction consulting firm is owed $80,000. Salem LLC, which is registered at New Salem Missionary Baptist Church and owed by Rev. Jerry McAfee, is owed $37,000. McAfee said the company is owed the money for work that they did to weatherize low-income homes.
Community Action shut down in September after the Star Tribune reported on the DHS audit. Since then, the receiver has found allegations of other potential misspending. The misspending includes allegations that Community Action senior leaders used the organization’s money to pay friends’ medical expenses and credit card bills, court records show.
Senior management also allegedly diverted money in the form of “wages” to friends and family members and allowed employees to double bill for meals and gas.
Bill Davis, the organization's CEO, could not be reached for comment, but has denied any wrongdoing. Court records filed in February indicate that the FBI and IRS are investigating the misspending.
Davis and Knight are in a dispute over what information Davis needs to disclose. Knight is seeking all documents related to CAM, but Knight has told the court that Davis is not cooperating.
In recent court filings, Knight included a records request that seeks to obtain documents pertaining to vehicle purchases, personal loans, a Ben and Jerry's "PartnerShop" and all documents referring or relating to Mad Dads, a north Minneapolis non-profit.
Davis' partner, Patricia Banks, is the program director at Mad Dads.
Community Action of Minneapolis has just over $1.8 million in assets, but owes at least $2.2 million, according to court documents. That amount does not include potentially large amounts of money owed to private contractors and the Minnesota Department of Commerce.