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AIDS Housing Group Scrutinized

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A series of investigative reporting pieces published in the weekly online edition of City Limits, a monthly urban policy magazine, have raised questions about potential financial improprieties at a nonprofit homeless and AIDS housing group headed up by C. Sterling Zinsmeyer, a longtime gay leader who is the past president of the Stonewall Democrats and has been active in the New York outreach efforts of the Human Rights Campaign. The stories, published February 3 and February 10 and written by Geoffrey Gray, reported that Praxis Housing Initiatives faces scrutiny from the federal Department of Housing and Urban Development, New York State Attorney General Eliot Spitzer, and the city’s Department of Investigation on charges that the group funneled hundreds of thousands of dollars from its nonprofit activities into for-profit housing concerns controlled by Zinsmeyer, the Praxis CEO, and Rev. Gordon Duggins, its executive director, sometimes through interest-free loans. City Limits also reported that Duggins on several occasions used the non-profit’s funds to buy clothes, toys, and home heating fuel and in 1997 tapped the group for $5,000 to bail out an imprisoned friend who was the leader of a street gang. The magazine quotes Zinsmeyer as conceding that mistakes were made, but also insisting that all of the money applied to the for-profit entities and spent by Duggins had been repaid to Praxis. City Limits also reported, however, that a confidential letter written by Zinsmeyer stated that $300,000 of Praxis money was lost in the Latham Hotel, an unsuccessful for-profit enterprise that he and Duggins oversaw. Founded in 1995, Praxis operates supportive housing facilities in Manhattan and Brooklyn, serving clients mostly referred by the city’s HIV/AIDS Services Administration (HASA). According to City Limits, about half of the group’s $7.3 million budget comes from government grants, with the rest paid in rent by the city on behalf of HASA clients. The magazine reported that for-profit facilities controlled by Zinsmeyer and Duggins, in Manhattan, Brooklyn, and the Bronx, are also managed by Praxis. City Limits quoted Cyril Brosnan, a former chair of Praxis, as calling the financial questions swirling around the non-profit “a huge scandal,” even while conceding that he should have exercised greater oversight. Brosnan, a retired social service professional who was a senior executive at Blue Cross/Blue Shield, told Gay City News that his frequent demands for more information were deflected by Zinsmeyer and Duggins. Emily Gest, a spokesperson for the city’s Department of Investigations, confirmed that an investigation of Praxis is underway. Brad Maione, a spokesperson for Spitzer’s office, confirming that complaints had been received about Praxis, said, “We are taking a very serious look at this.” Adam Glantz, who works in the New York office of the Department of Housing and Urban Development, said the matter had been referred to HUD’s Inspector General. Ruth Ritzema, an Inspector General spokesperson, could neither confirm nor deny that her office was looking at Praxis. Zinsmeyer expressed confidence to City Limits that all inquiries into Praxis’ finances would be satisfactorily concluded, but did not return Gay City News’ call for comment. In a written statement issued on February 20, Praxis said it had retained counsel to conduct a thorough and independent financial audit and to “put to rest allegations made by a dismissed employee.” “Praxis is proud of the housing services it has provided to hundreds of formerly homeless New Yorkers with HIV/AIDS since 1995,” the statement said. Jill Grossman, senior editor at City Limits, said the magazine is continuing to track the story and will have a complete follow up in its March print edition. The magazine can be accessed at www.citylimits.org.

Updated 5:17 pm, July 20, 2018
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