SDC Faces Debts, Board Vacancies, Lawsuits

The Social Development Commission, or SDC, is facing new developments with its funding, board and lawsuits.

Here is what you need to know.

Questions raised about vendor payments, leadership at board meeting

Amy Rowell, executive director of COA Youth and Family Centers, attended the SDC’s board meeting on July 17 to ask the board about the status of an unpaid invoice. In March, NNS reported programming changes at COA, which serves families in the Amani, Riverwest and Harambee neighborhoods of Milwaukee.

Rowell said SDC owes more than $153,800 in reimbursements related to the Workforce Innovation Grant, which COA has requested from the agency multiple times since last August.

“It’s been putting a pretty significant hardship on the organization because we paid the invoice and now we’re just waiting for reimbursement,” Rowell said.

Jorge Franco, chair of the board and interim CEO of SDC, told Rowell that SDC would follow up with her but did not have an estimate of when the invoice would be paid.   

SDC Commissioner Pam Fendt thanked Rowell for her comments and voiced concern about Franco’s leadership.

“I would like to make a public statement at this time that I do not feel that the board has been staffed by the interim CEO in a way that allows me to have input on budget or funding decisions,” Fendt said.

Commissioner Walter Lanier agreed, adding that the board should focus on how to govern more effectively.

“I think it’s extremely high priority, top priority, for us to do that and I think we need to make some changes to make that happen,” Lanier said.

Federal review of community action status

The Wisconsin Department of Children and Families in May planned to remove the SDC’s community action agency status, effective July 3. Removing that status would make SDC ineligible for millions in Community Services Block Grant funding and hinder the organization’s path to relaunch services and secure other funding.

However, that decision is on hold while the U.S. Department of Health and Human Services, or HHS, conducts a review of the state’s hearing and decision-making process and evaluates if it followed federal guidance.

The Department of Children and Families has sent documentation to HHS to examine for the review, according to Gina Paige, communications director for the department.

State moves forward with plans to replace SDC

The Department of Children and Families continues to look for agencies in the state that could possibly use the remaining block grant funding to be an interim provider of anti-poverty services in Milwaukee County if the state’s decision is upheld.

“DCF has received applications from interested community action agencies and is currently in discussions with relevant parties,” Paige said.

The state is preparing to move quickly to resume services if HHS upholds its decision and the de-designation is completed, she said.

“I think we’re likely going to see more of, like, the food services turned back on, probably some of the rental housing assistance, just because there’s some established networks there that folks will be able to leverage to get those turned back on,” Paige said.

The department is requesting applications from existing community action agencies to serve the unserved county because of the Wisconsin CSBG State Plan, which requires the state to see if an existing agency can take over services before creating a new community action agency.

Additionally, the future of the program is uncertain because President Donald Trump proposed eliminating CSBG funding in his budget for 2026.

If Congress decides to continue CSBG funding, the state will consider starting a process to select one or more permanent community action agencies to serve Milwaukee County, Paige said.

Foreclosure hearing scheduled

A new motion in the foreclosure lawsuit against the Social Development Commission’s property corporation could result in a judgment by October.

Earlier this year, Forward Community Investments Inc. filed a lawsuit against SD Properties Inc., the tax-exempt corporation that owns SDC’s buildings. The lawsuit resulted from SD Properties defaulting on mortgage payments on its North Avenue buildings and it now owes over $3 million in loan obligations, interest and other costs, according to court records.

In June, the attorneys representing Forward Community Investments filed a motion requesting a summary judgment hearing, which has been scheduled before  Circuit Court Judge J.D. Watts for 11 a.m. on Oct. 6 in Room 414 at the Milwaukee County Courthouse, 901 N. 9th St.

A summary judgment hearing asks the court to grant judgment in favor of a party based on the law without a full trial, according to William Sulton, SDC’s attorney.

“That is something that is common in foreclosure cases and other cases,” Sulton said. “It’s not something that surprised us or alarmed us.”

Before the summary judgment, there will be a scheduling conference in the case on July 24 at 9:30 a.m. in Room 414 of the courthouse.

Board changes and vacancies

Milwaukee Area Technical College appointed Michael Rogers, MATC’s vice president of student engagement and community impact, to its seat on the SDC board.

Commissioner Vincent Bobot’s term expired on June 1, but he remains as the chair of the SD Properties board.

Bobot was serving his third term as an elected commissioner for SDC’s District 6, in the southern portion of the county, and briefly served as the agency’s CEO and board chair last fall.

He said on July 17 that he is not sure if he plans to run for re-election.

Many appointments have been made to the SDC board in the last few months, but the board now has vacancies in all six elected board seats.

Lanier focused on filling vacancies, board consistency

Before the meeting, Lanier said he believes that working on the board’s governance, such as filling vacancies and holding elections to get community representation, will put the board in a better position to address the organization’s challenges.

“​​I think once we finish some of our transitions and get the board fully active, the board will be able to be moved forward in a more effective way,” he said.

SDC’s next board meeting is scheduled for Sept. 4.

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Meredith Melland is the neighborhoods reporter for the Milwaukee Neighborhood News Service and a corps member of Report for America, a national service program that places journalists in local newsrooms to report on under-covered issues and communities. Report for America plays no role in editorial decisions in the NNS newsroom.

This article first appeared on Milwaukee Neighborhood News Service and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.