Audit Reveals Mismanagement of Funds at NOEDA

News Summary

A recent audit has exposed serious mismanagement of funds at the New Orleans Economic Development Association (NOEDA), revealing that almost half of a $400,000 grant for job training was wasted on unprofitable bingo games. The Louisiana Legislative Auditor highlighted failures in financial oversight, accountability, and reporting, raising concerns about NOEDA’s mission to support community services. The association has acknowledged these issues and plans to improve fiscal management by hiring professional oversight.

New Orleans – A recent audit has revealed significant mismanagement of state funds allocated to the New Orleans Economic Development Association (NOEDA), including nearly half of a $400,000 grant intended for job training and eviction prevention. The Louisiana Legislative Auditor reported that approximately $199,568 of the funding was spent on charitable bingo games that failed to generate profit, violating the terms of NOEDA’s cooperative endeavor agreement with the state.

Since its founding in 1992, NOEDA has aimed to support community organizations focused on vital services such as job training and crime prevention. However, the financial practices highlighted in the audit raise serious concerns about the organization’s capability to fulfill its mission effectively. For instance, it was reported that NOEDA awarded $185,000 to various businesses and recipients without proper tracking or accountability for how the funds were utilized in accordance with economic development goals.

The audit findings reveal that NOEDA spent over $52,000 to rent a former boxing gym for bingo games conducted from May to November, alongside an additional $13,260 for electrical supplies and building upgrades for the bingo venue. Unfortunately, attendance at these games averaged only a few dozen participants, far below the projected turnout of 200 people.

Furthermore, the association neglected to submit required reports detailing fund usage by the March 5, 2024 deadline. It was also found that at least 29 individuals were compensated over $600, yet NOEDA failed to provide the necessary 1099 tax forms, which are a regulatory requirement for disbursing certain payments.

According to the terms of their state funding agreement, NOEDA was expected to distribute about $680,000 and enroll a minimum of 125 participants in its programs by June 30, 2024. The audit revealed that while $185,000 was distributed to six recipients, the largest payout went to Proficient Media Services, which received $115,000 based on a proposal to produce a movie aimed at reinvigorating the local economy. However, the audit noted a lack of documentation confirming any engagement with participants in job training roles related to this project.

The film produced reportedly involved creating documentaries, and students supposedly participated in various aspects such as interviews and camera operations. The known expenses for the project included $23,000 in salaries and $50,000 spent on equipment purchases. Nevertheless, the absence of clear documentation raises doubts about the actual benefit and impact of the funding.

In response to the audit’s findings, the association has indicated plans to improve financial oversight by hiring a certified public accountant and engaging legal counsel to ensure compliance with state obligations moving forward. Additionally, NOEDA has pending proposals for further funding from the city of New Orleans.

The situation reflects a critical need for better fiscal management within NOEDA to ensure that allocated resources are utilized effectively for meaningful community impact. The audit underscores the importance of accountability in the disbursement of public funds, especially when aimed at supporting economic development initiatives in the region.

As NOEDA moves forward, the organization faces increased scrutiny and pressure to demonstrate its commitment to financial responsibility and the achievement of its designated goals in serving the local community.

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Additional Resources

• La Illuminator
• NOLA.com
• Louisiana Radio Network
• Fox 8 Live
• New Orleans City Business
• Wikipedia: Economic development
• Google Search: New Orleans Economic Development Association
• Google Scholar: job training programs New Orleans
• Encyclopedia Britannica: job training
• Google News: New Orleans NOEDA