Fifty years ago, the U.S. Congress passed the Economic Opportunity Act of 1964. It was part of President Lyndon Johnson's War on Poverty. The legislation created CAP, or Community Action Program agencies. They serve as a pass through agent for state and federal funding to help disadvantaged people around the country.
In Connecticut, some subcontractors who performed work for CAP agencies in Danbury and Norwalk have alleged the agencies mishandled state funding directed towards Latino communities. The complaints highlight tensions between the agencies that control the money and the subcontractors that do the work. But those relationships are also changing.
Michelle James has short, natural curly hair and a can-do attitude. She runs an anti-poverty agency in Danbury now called the Community Action Agency of Western Connecticut.
"I don't like to fail, I don't like people around me to fail," James said. "I want to foster collaboration and team effort [among staff]," she added.
James is on a mission: To turn around negative perceptions of the agency. When asked about the cause of those perceptions, James declined to elaborate.
But she alluded to past problems related to needing "a new kind" of leader, someone permanent and board members who regularly attended meetings.
She’s only been on the job for a year but has already hired new staff and replaced some board members.
According to James, the only recent financial deficit the agency faced was during one quarter in 2012.
Since then, the agency has bounced back and gained the confidence of state officials.
"We’ve done such a good job here, running our Human Hispanic Development [HHD] grant program that they gave us the contract for Norwalk and Stamford," she said one recent morning.
The HHD grant funds services for low-income Latino communities statewide.
In this case, the Connecticut Department of Social Services awarded the CAAWC a nearly $90,000 partial-year grant in January to pay for Spanish-speaking case workers in Nowalk and Stamford through September.
It is also providing services in its 11-community area under a separate HHD grant.
The CAP agency took over the grant after the local community action agency, Norwalk Economic Opportunity Now, imploded.
At the same time, James’ agency is currently being sued by the Hispanic Center of Greater Danbury, its subcontractor, for how it handled funding for the same grant in its traditional catchment area in western Connecticut.
Carlos Valenzuela is the executive director of the Hispanic Center, which is the plaintiff in the case.
"In terms of the relationship, it had to come to an end," he said, referring to his organization's involvement with the CAAWC, formerly the Community Action Committee of Danbury [CACD].
According to the complaint filed Nov. 19, 2013 in Danbury Superior Court, the Hispanic Center alleged its owed a balance of $64,725.58 for services it performed in 2012 as a state-approved subcontractor under the grant.
The document states on June 29, 2012, the CACD opted to terminate the contract with the Hispanic Center "effective 180 days from the date of this letter" as required by the contract.
That would make the termination effective on December 29.
However, the Hispanic Center claimed payments stopped in late June, while quarterly grant disbursements from the state to the CACD continued.
Valenzuela didn't want to talk about the lawsuit but said the Hispanic Center has plans to move beyond its subcontractor status.
"We are just trying to work on our next program, find new funding opportunities and keep our heads focused on the community," he said, at his organization's headquarters in Danbury.
There is a similar allegation of withheld money from the HHD grant in Norwalk, too.
Officials involved with the South Norwalk Community Center say its CAP agency, NEON, failed to transfer funds from the grant in 2012.
The community center was a subcontractor to NEON for the grant.
Warren Pena said after he became chairman of the center in late 2012, he noticed a discrepancy in the contract.
He said it stated funding was to pay for the salaries of six employees, supplies, phones and equipment.
"That wasn't what was going on," Pena said. "We had one full-time executive director and a part-time person. So I began to question a lot of the grant. Where were these resources going?"
Pena, who has since stepped aside from board involvement to run in a primary for a state Senate seat, said efforts to talk to NEON management, the state Department of Social Services and the Governor – were all rebuffed at the time.
The DSS and the Governor also did not respond to requests for comment for this story.
Nor did the community center's acting executive director Kelly Robertson.
But Latino community leaders say the problem puts state oversight in question.
Norwalk attorney Ed Camacho, now acting chair board chair of the community center, said there has also been a culture where CAP agencies treated its subcontractors as lesser entities.
"They [CAP agencies] felt that they had pretty much a free reign over those [HHD grant] monies," he said.
But CAP agency leaders dispute that there's been any wrongdoing. In fact, the agencies say they undergo rigorous reporting audits each quarter by state and federal authorities.
Edith Karsky is executive director of the Connecticut Association For Community Action (CAFCA), which supports the ten CAP agencies in the state.
Reached by telephone, Karsky said the number of subcontractors to CAP agencies, called "delegate agencies" are on the decline.
One reason is that many non-profits went out of business or merged after the 2008 recession hit.
And many CAP agencies, like the CAAWC, are providing services directly and to all communities. Statewide, she said that number is 360,000 a year.
"Of those, 117,000 were Hispanic or Latino, 80,000 were African-American and the remainder were low-income Caucasian," said Karsky, "so you can see we really serve the entire community."
Yet Karsky said the need among the state's poor is increasing, while funding sources are diminishing.
Former niche groups that served a primary racial or ethnic group are now expanding to try and broaden their services and funding opportunities.
And shifting demographics are playing a role, too.
For example, the Hispanic Center of Greater Danbury is in the midst of changing its name to the Multicultural Center of Western Connecticut.
Its executive director, Carlos Valenzuela, said the agency now serves more than just Latinos.
There is now a sizeable Cambodian immigrant presence in Danbury, Valenzuela said.
And more and more Latinos are reaching middle class.