CHILDREN YOUTH INVESTMENT TRUST CORPORATION PERFORMANCE OVERSIGHT HEARING

MARCH 4, 2013

OPENING STATEMENT GOOD MORNING. I AM COUNCILMEMBER JIM GRAHAM, CHAIRPERSON OF THE COMMITTEE ON HUMAN SERVICES. THE TIME IS _______________, ON MONDAY, MARCH 4, 2013. WE ARE IN ROOM 412 OF THE HISTORIC JOHN A. WILSON BUILDING AT 1350 PENNSYLVANIA AVENUE, NW, FOR THE PERFORMANCE OVERSIGHT HEARING OF THE DEPARTMENT OF YOUTH REHABILITATION SERVICES AND THE CHILDREN AND YOUTH INVESTMENT TRUST CORPORATION. WE WILL FIRST HEAR FROM PUBLIC WITNESSES FOR THE CHILDREN AND YOUTH INVESTMENT TRUST CORPORATION AND THEN EXECUTIVE DIRECTOR ED DAVIES, AND BOARD PRESIDENT ROBERT BOBB. FOLLOWING A QUICK BREAK, WE WILL THEN HEAR FROM THE PUBLIC WITNESSES FOR THE DEPARTMENT OF YOUTH REHABILITATION SERVICES AND THEN DIRECTOR NEIL STANLEY.

I WANT TO WELCOME ED DAVIES, THE EXECUTIVE DIRECTOR OF THE CHILDREN AND YOUTH INVESTMENT TRUST CORPORATION AND ROBERT BOBB - - WHO NEEDS NO INTRODUCTION - - BUT TODAY IS HERE AS THE PRESIDENT OF THE BOARD OF THE TRUST. MR. BOBB HAS COMMITTED HIS LIFE TO PUBLIC SERVICE - - AND MORE THAN THAT - - HAS COMMITTED HIS LIFE TO STEPPING INTO VERY DIFFICULT, AND CHALLENGING PROBLEMS THAT MOST PEOPLE WOULD RUN FROM. IN THE NINE MONTHS THAT MR. BOBB HAS BEEN BOARD PRESIDENT, HIS INFLUENCE HAS BEEN TREMENDOUS. THERE IS NO DOUBT THE TRUST HAS BEEN TROUBLED OVER THE LAST SEVERAL YEARS. AND I THINK MOST WOULD AGREE WE ARE MAKING PROGRESS. MR. BOBB AND I RECENTLY HAD A VERY PUBLIC EXCHANGE, BUT I THINK MOST OF THAT IS BEHIND US NOW AND WE ARE MOVING FORWARD. THE TRUST IS A UNIQUE ENTITY IN THE DISTRICT OF COLUMBIA. IT HELD GREAT PROMISE WHEN IT WAS ESTABLISHED IN THE 1999 BUDGET SUPPORT ACT TO PROVIDE OUT-OF-SCHOOL PROGRAMS FOR DISTRICT YOUTH. $15 MILLION WAS APPROPRIATED IN FY2000. THE ACT PROVIDED

THAT THE MONEY WAS AVAILABLE ONLY IF THE COUNCIL APPROVED A RESOLUTION SUBMITTING BY-LAWS THAT A NON-SERVICE PROVIDER, NON-PROFIT ORGANIZATION CONTAINS BOARD OF DIRECTORS COMPOSED ENTIRELY OF VOTING MEMBERS APPOINTED BY THE MAYOR AND COUNCIL. THE TRUST AND ITS GRANTEES WERE ALSO MANDATED BY LAW TO PROVIDE ANY INFORMATION RELATING TO THE GRANT REQUIRED BY THE MAYOR OR A MEMBER OF THE COUNCIL. IT WAS CLEAR FROM THE BEGINNING - - AND TODAY AS WE SIT HERE IN THIS COUNCIL HEARING ROOM - - THAT WHATEVER ITS CHARITABLE 501(C) (3) STATUS, THE TRUST WOULD NOT BE INDEPENDENT AND WOULD INSTEAD BE GOVERNED BY AND ACCOUNTABLE TO DC GOVERNMENT. AFTER A LENGTHY AND PAINFUL INVESTIGATION BY THIS COMMITTEE LAST YEAR O THE TRUSTS ROLE IN THE FORMER COUNCILMEMBER THOMAS FRAUD CASE, WE CONCLUDED - AND THE COUNCIL AGREED - - THAT THE TRUSTS GOVERNANCE STRUCTURE NEEDED A SECOND LOOK. ADVOCATES, YOUTH SERVING ORGANIZATIONS, AND PHILANTHROPISTS HAVE BEEN TELLING US FOR YEARS THE

TRUST NEEDS MORE INDEPENDENCE FROM THE DISRICT GOVERNMENT. THE BSA LANGUAGE THE COUNCIL PASSED LAST YEAR REQUIRES THE MAYOR AND THE COUNCIL CHAIRMAN TO APPOINT AN ENTIRELY PRIVATE SECTOR TASK FORCE TO REVIEW THE CURRENT GOVERNANCE STRUCTURE AND MAKE RECOMMENDATIONS FOR CHANGE. THERE HAS BEEN NO ACTION. SO WE ARE HERE TODAY. THE TRUST HAS RESPONDED TO THE COMMITTEES SEVERAL DOZEN, DETAILED QUESTIONS. THEIR RESPONSES WERE EQUALLY DETAILED AND MORE SO. IN FY 13 THE TRUST RECEIVED A DIRECT LINE ITEM OF $3 MILLION TO MANAGE THE OUT OF SCHOOL TIME PROGRAM. IT ALSO IS THE FISCAL AGENT FOR THE FEDERAL OPPORTUNITY SCHOLARSHIP PROGRAM WHICH THIS YEAR WAS FULLY FUNDED FOR THE FIRST TIME, AT $19 MILLION. THE TRUST EMPLOYS 31 PERSONS. THE TRUST ALSO RECEIVES RE-PROGRAMMINGS AND ENTERS MOUS WITH DISTRICT AGENCIES TO MANAGE YOUTH DEVELOPMENT PROGRAMS. THIS YEAR, THE DEPARTMENT OF YOUTH REHABILITATION SERVICES AND DEPARTMENT OF

MENTAL HEALTH HAVE AGREEMENTS WITH THE TRUST. CHILD AND FAMILY SERVICES AGENCY AND THE DEPARMENT OF HUMAN SERVICES HAVE ALSO WORKED CLOSELY WITH THE TRUST OVER THE YEARS. I WANT TO CONGRATULATE MR. DAVIES AND THE TRUST ON SEVERAL INITIATIVES AND ACCOMPLISHMENTS OF THE PAST YEAR WHILE UNDER INTENSE SCRUTINY - - SOME OF US CAN IDENTIFY WITH BEING UNDER SCRUTINY. ALTHOUGH MR. DAVIES HAS BEEN EXECUTIVE DIRECTOR ONLY SINCE NOVEMBER, HIS IMPACT ON THE TRUST LONG BEFORE THAT WAS OBVIOUS. FIRST, I THINK ALL WOULD AGREE THIS PAST SUMMERS ONE CITY SUMMER INITIATIVE (OCSI) AMPLIFIES THE NEED FOR THE TRUST. IT WAS CLEARLY A MULTI-AGENCY, MULTIDISCIPLINED, PUBLIC PRIVATE PARTNERSHIP REACHING 40,000 DC KIDS. IT REQUIRED PLANNING, COORDINATION, BUY-IN, AND LEADERSHIP - - ALL PROVIDED THROUGH THE TRUST. THE INITIATIVE ALSO REVEALS THE BLESSING AND THE CURSE OF THE CURRENT GOVERNANCE STRUCTURE. THE BLESSING IS ONLY THE MAYOR COULD DEMAND THE 28 OTHER

DISTRICT AGENCIES TO COOPERATE AND MOVE FUNDS WHERE NEEDED. THE CURSE IS THAT IS THE TYPE OF GOVERNMENT INFLUENCE THAT SOME TIMES BECOMES A PROBLEM. THE MODEL IS A GOOD ONE - - AND IT NEEDS TO BE FULLY FUNDED - - WITH PUBLIC AND PRIVATE FUNDS. SECOND, THE BOARD HAS SAID IT IS TAKING CONCRETE STEPS TO FOLLOW THE RECOMMENDATIONS AND CORRECTIVE ACTIONS THAT ARE INCLUDED IN THE FY 2010 AUDIT. THEY HAVE SET A DEADLINE OF APRIL 1, 2013 TO MAKE THOSE CORRECTIONS. WE WILL TALK WITH MR. BOBB AND MR. DAVIES ABOUT THOSE CORRECTIVE ACTIONS. THIRD, THERE IS A SOLID PLAN TO RAISE PRIVATE FUNDS. I HOPE THE CLOUD OVER THE TRUST LIFTS - - AS IT LIFTS, SO TOO WILL PRIVATE PHILANTHROPISTS ONCE AGAIN APPRECIATE THE GOOD WORK THAT IS BEING DONE NOW AT THE TRUST. THERE ARE ISSUES THOUGH. AND WE WILL ADDRESS THOSE. OF MOST CONCERN TO ME IS THE FUTURE OF THE LEAD ENTITY / DC YOUTHLINK PROGRAM UNDER THE JOINT OVERSIGHT OF BOTH DYRS AND THE TRUST. WE WILL DISCUSS

THOSE QUESTIONS WITH MR. DAVIES, BUT IN MORE DETAIL WITH DYRS DIRECTOR STANLEY, WHO IS ULTIMATELY RESPONSIBLE TO ENSURE THE YOUTH UNDER HIS CARE AND CUSTODY ARE PARTICIPATING IN QUALITY PROGRAMS. I AM ALSO VERY CONCERNED, AND I AM SURE MR. DAVIES IS AS WELL, ABOUT THE 19 YOUNG STUDENTS THAT HAVE BEEN EXPELLED FROM SCHOOLS PARTICIPATING IN THE OPPORTUNITY SCHOLARSHIP PROGRAM. WHILE THIS IS FEDERAL MONEY, THESE ARE DC KIDS BEING EXPELLED. WE WILL LOOK INTO THIS TOGETHER. LETS CALL OUR FIRST WITNESS.