The Board of Supervisors Budget Committee was scheduled to vote Wednesday on loaning $150,000 to a struggling nonprofit that provides health services for the LGBT community who are low-income.
But the proposal was postponed indefinitely amid concerns about the nonprofit’s financial state. Supervisor Ross Mirkarimi, who introduced the unusual proposal, said that the nonprofit Lyon-Martin needs to “to complete their financial assessment so that they are in a very clear and confident position … with regard to their ability to be able to consider taking on a loan.”
“That is what is pending,” Mirkarimi said.
The proposal seemed ill-timed as The City is facing a $283 million deficit. And a non-interest loan to someone with no guarantee it could repaid probably wouldn’t sit well with residents. A report from budget analyst Harvey Rose issued days before the meeting raised a number of questions about the nonprofit’s financials
Lyon-Martin has $1.1 million of debt as a result of “insufficient cash flow, insufficient payor mix, expanded services without adequate financial systems to monitor growth and ensure solvency, inadequate billing infrastructure and insufficient billing to MediCal for services provided and reduced fundraising activities,” the report said. The debt also includes $300,000 owed to the IRS.