Texas Funnels Hundreds of thousands to Anti-Abortion Teams With Little Oversight — ProPublica

12 months after 12 months, whereas Roe v. Wade was the regulation of the land, Texas legislators handed measures limiting entry to abortion — who may have one, how and the place. And with the identical cadence, they added thousands and thousands of {dollars} to a program designed to discourage individuals from terminating pregnancies.

Their funds infusions for the Options to Abortion program grew with nearly each legislative session — first step by step, then dramatically — from $5 million beginning in 2005 to $140 million after the U.S. Supreme Courtroom overturned the fitting to an abortion.

Now that abortion is basically unlawful in Texas, lawmakers say they’ve shifted the aim of this system, and its thousands and thousands of {dollars}, to supporting households affected by the state’s ban.

Within the phrases of Rep. Jeff Leach, a Republican from Plano, the objective is to “present the total assist and sources of the state authorities … to come back alongside of those hundreds of ladies and their households who may discover themselves with sudden, unplanned pregnancies.”

However an investigation by ProPublica and CBS Information discovered that the system that funnels a rising pot of state cash to anti-abortion nonprofits has few safeguards and is riddled with waste.

Officers with the Well being and Human Providers Fee, which oversees this system, don’t know the specifics of how tens of thousands and thousands of taxpayer {dollars} are being spent or whether or not that cash is addressing households’ wants.

In some instances, taxpayers are paying these teams to distribute items they obtained totally free, permitting anti-abortion facilities — which are sometimes known as “disaster being pregnant facilities” and could also be set as much as appear to be clinics that carry out abortions — to invoice $14 handy out a few donated diapers.

Distributing a single pamphlet can internet the identical $14 payment. The state has paid the charities thousands and thousands to distribute such “instructional supplies” about subjects together with parenting and adoption; it could’t say precisely what number of thousands and thousands as a result of it doesn’t acquire knowledge on the products it’s paying for. State officers declined to offer examples of the supplies by publication time, and reporters who visited being pregnant facilities have been turned away.

For years, Texas officers have failed to make sure spending is correct or productive.

They didn’t conduct an audit of this system within the wake of revelations in 2021 that a subcontractor had used taxpayer funds to function a smoke store and to purchase land for hemp manufacturing.

They ramped up funding to this system in 2022 even after some contractors failed to satisfy their few targets for achievement.

After a legislative mandate handed in 2023, lawmakers ordered the fee to arrange a system to measure the efficiency and impression of this system.

One 12 months later, Well being and Human Providers says it’s “working to implement the provisions of the regulation.” Company spokespeople answered some questions however declined interview requests. They mentioned their predominant contractor, Texas Being pregnant Care Community, was liable for most program oversight.

The nonprofit community receives probably the most funding of this system’s 4 contractors and oversees dozens of disaster being pregnant facilities, faith-based teams and different charities that function subcontractors.

The community’s government director, Nicole Neeley, mentioned these subcontractors have broad freedom over how they spend income from the state. For instance, they’ll reserve it or use it for constructing renovations.

Being pregnant Middle of the Coastal Bend in Corpus Christi, as an example, constructed up a $1.6 million surplus from 2020 to 2022. Govt Director Jana Pinson mentioned two years in the past that she plans to make use of state funds to construct a brand new facility. She didn’t reply to requests for remark. A ProPublica reporter visited the waterfront plot the place that facility was deliberate and located an empty lot.

As a result of subcontractors are paid set charges for his or her providers, Neeley mentioned, “what they do with the {dollars} of their financial institution accounts isn’t related” to the Thriving Texas Households program. “It’s not taxpayer cash.”

The state mentioned these funds are, in truth, taxpayer cash. “HHSC takes stewardship of taxpayer {dollars}, appropriated by the Legislature, very severely by making certain they’re used for his or her meant objective,” a spokesperson mentioned.

None of that has precipitated lawmakers to cease the money from flowing. In truth, final 12 months they blocked necessities to make sure sure providers have been evidence-based.

Leach, one of many program’s most ardent supporters, mentioned in an interview with ProPublica and CBS Information that he would search accountability “if taxpayer {dollars} aren’t being spent appropriately.” However he remained assured about this system, saying the state would maintain investing in it. In truth, he mentioned, “We’re going to double down.”

What’s extra, lawmakers across the nation are contemplating applications modeled on Options to Abortion.

Final 12 months, Tennessee lawmakers directed $20 million to fund disaster being pregnant facilities and comparable nonprofits. And Florida enacted a 6-week abortion ban whereas together with in the identical invoice a $25 million allocation to assist disaster being pregnant facilities. John McNamara, a longtime chief of Texas Being pregnant Care Community, has been working to start out comparable networks in Kansas, Oklahoma and Iowa. He’s additionally reserved the identify Louisiana Being pregnant Care Community.

And U.S. Home Republicans are advocating for permitting federal {dollars} from the Momentary Help for Needy Households program — meant to assist low-income households — to stream to being pregnant facilities. In January, the Home handed the laws, and it’s pending within the Senate. Rep. Elise Stefanik, R-N.Y., castigated Democrats for voting towards the invoice.

“That’s taking away diapers, that’s taking away sources from households who’re in want,” she mentioned in an interview with CBS Information after the vote.

However, as Texas reveals, extra funding doesn’t essentially pay for extra diapers, system or different assist for households.

Lawmakers rebranded Options to Abortion as Thriving Texas Households in 2023. This system is meant to advertise pregnancies, encourage household formation and improve financial self-sufficiency.

The state pays 4 contractors to run this system. The biggest, which will get about 80% of the state funding, is the anti-abortion group Texas Being pregnant Care Community.

Human Coalition, which will get about 16% of the state funding, mentioned it makes use of the cash to offer purchasers with materials items, counseling, referrals to authorities help and training. Austin LifeCare, which will get about 3% of the state funding, couldn’t be reached for remark about this story. Longview Wellness Middle in East Texas, which receives lower than 1% of the funds, mentioned the state routinely audits its bills to make sure it’s working inside pointers.

Texas Being pregnant Care Community manages dozens of subcontractors that present counseling and parenting courses and that distribute materials help similar to diapers and system. Mother and father should take a category or endure counseling earlier than they’ll get these items.

The state might be charged $14 every time certainly one of these subcontractors distributes objects from certainly one of a number of classes, together with meals, clothes and academic supplies. Which means the distribution of a few instructional pamphlets may internet the identical $14 payment as a a lot pricier pack of diapers.

A single go to by a consumer to a subcontractor can lead to a number of costs stacking up. Facilities are eligible to gather the charges no matter what number of objects are distributed or how a lot they’re price. One April morning, a consumer at McAllen Being pregnant Middle, close to the Texas-Mexico border, acquired a bag with some diapers, a child outfit, a child blanket, a pack of wipes, a child brush, a snack and two pamphlets. It was not clear how a lot the middle invoiced for this stuff.

McAllen Being pregnant Middle and different Texas Being pregnant Care Community subcontractors have been paid greater than $54 million from 2021 to 2023 for distributing these things, in response to data.

How a lot of that was for handing out pamphlets? The state mentioned it didn’t know; it doesn’t acquire knowledge on the portions or forms of objects supplied to purchasers or whether or not they’re important objects like diapers or simply pamphlets, making it inconceivable for the general public to understand how tax {dollars} have been spent.

Neeley mentioned in an e mail that instructional supplies like pamphlets solely accounted for 12% of the cash reimbursed on this class final 12 months, or roughly $2.4 million out of $20 million. She didn’t reply to questions from ProPublica and CBS Information about proof that might corroborate that quantity.

The best way subcontractors are paid, and what they’re allowed to do with that cash, raised questions amongst charity consultants consulted for this investigation.

Within the nonprofit sector, utilizing a fee-for-service fee mannequin for materials help is very uncommon, mentioned Vincent Francisco, a professor on the College of Kansas who has labored as a nonprofit administrator, evaluator and guide over the previous three many years. It “can run quick and unfastened for those who’re not cautious,” he mentioned.

Even when nonprofits distribute objects they obtained totally free or near it, the state will nonetheless reimburse them. Take Viola’s Home, a being pregnant heart and maternity residence in Dallas. Data present that it pays a close-by diaper financial institution an administrative payment of $1,590 for about 120,000 diapers yearly — simply over a penny apiece. Viola’s Home can then invoice the state $14 for distributing a pack of diapers that price the middle simply over 1 / 4.

However earlier than they’ll get these diapers, dad and mom should take a category. The middle also can invoice the state $30 for every hour of sophistication a consumer attends.

Rep. Donna Howard, a Democrat from Austin, mentioned this system might be extra environment friendly if the state funded the diaper banks instantly. Final 12 months, she proposed diverting 2% of Thriving Texas Households’ funding on to diaper banks, however the proposal failed.

Data present that in fiscal 12 months 2023, Viola’s Home acquired greater than $1 million from the state in reimbursements for materials assist and academic objects plus one other $1.7 million for courses. Govt Director Thana Hickman-Simmons mentioned Viola’s Home depends on funding from an array of sources and that only a small fraction of the diapers it distributes come from the diaper financial institution. She mentioned the state cash “may by no means cowl the whole lot that we do.”

In some instances, reimbursements have created a hefty cushion within the budgets of subcontractors. The state doesn’t require them to spend the taxpayer funds they get on needy households, and Texas Being pregnant Care Community mentioned subcontractors can spend the cash as they see match, so long as they comply with Inside Income Service guidelines for nonprofits.

McAllen Being pregnant Middle acquired $3.5 million in taxpayer cash from Texas Being pregnant Care Community over three years, but it surely spent lower than $1 million on program providers, in response to annual returns it filed with the IRS. In the meantime, $2.1 million was added to the group’s belongings, largely in money. Its government director, Angie Arviso, requested a reporter who visited in particular person to submit questions in writing, however she by no means responded.

“It is a coverage alternative Texas has made,” mentioned Samuel Brunson, affiliate dean for school analysis and growth on the Loyola College Chicago College of Regulation, who researches and writes concerning the federal earnings tax and nonprofit organizations. “It has chosen to redistribute cash from taxpayers to the reserve funds of personal nonprofit organizations.”

Tax consultants say that’s problematic. “Why would you give cash to a recipient that isn’t spending it?” mentioned Ge Bai, a professor of accounting and well being coverage at Johns Hopkins College.

The tax consultants disagree with Texas Being pregnant Care Community’s argument that the cash is not taxpayer {dollars} after its subcontractors are paid.

“It’s nonetheless the federal government shopping for one thing,” mentioned Jason Coupet, affiliate professor of public administration and coverage at Georgia State College, who has studied effectivity within the public and nonprofit sectors. “If I have been within the auditor’s workplace, that’s the place I’d begin having questions.”

State legislators and regulators haven’t put in oversight protections in this system.

Three years in the past, The Texas Tribune spotlighted the state’s refusal to trace outcomes or search perception into how subcontractors have spent taxpayer cash.

Months later, Texas Being pregnant Care Community reduce off funding to certainly one of its greatest subcontractors after a San Antonio information outlet alleged the nonprofit had misspent cash from the state.

KSAT-TV reported that the nonprofit, A New Life for a New Technology, had used Options to Abortion funds for holidays and a motorbike, and to fund a smoke store enterprise owned by the middle’s president and CEO, Marquica Reed. It additionally spent $25,000 on land that was later registered by a member of Reed’s household to supply industrial hemp.

In an interview with ProPublica, a former case supervisor recalled how Reed would get offended if staff forgot to invoice the state for a service supplied to a consumer.

The previous case supervisor, Bridgett Warren Campbell, mentioned staff would purchase diapers from the native Sam’s Membership retailer, then take aside the packages. “We’d take the diapers out and provides dad and mom two to a few diapers at a time, then she would invoice TPCN,” mentioned Campbell.

Reed declined to remark to a ProPublica reporter or to reply follow-up questions through e mail or textual content. Neeley, the Texas Being pregnant Care Community’s government director, mentioned the being pregnant heart was faraway from this system as a result of its nonprofit standing was in jeopardy, not as a result of it had used cash on private spending. She mentioned the community wasn’t liable for monitoring how A New Life for a New Technology spent its {dollars}: “The facility to analyze these issues of how nonprofits handle their very own funds is reserved statutorily to the Texas Legal professional Basic and the IRS.”

The Texas lawyer normal’s workplace wouldn’t say whether or not it has investigated the group. Data present that after KSAT’s story, state officers referred the case to an inspector normal and that the Texas Being pregnant Care Community submitted a report detailing the way it monitored the subcontractor.

The state requires contractors to submit impartial monetary audits in the event that they obtain not less than $750,000 in state cash; Texas Being pregnant Care Community meets this threshold. Nonetheless, its dozens of subcontractors don’t need to submit these audits — one thing consultants in nonprofit practices mentioned needs to be required. Within the fiscal 12 months earlier than the alleged misspending got here to gentle, A New Life for a New Technology acquired greater than $1 million in reimbursements from the state, data present.

When ProPublica and CBS Information requested how the Well being and Human Providers Fee detects fraud or misuse of taxpayer funds, Jennifer Ruffcorn, a fee spokesperson, mentioned the company “performs oversight by numerous strategies, which can embrace fiscal, programmatic, and administrative monitoring, enhanced monitoring, desk opinions, monetary reconciliations, on-site visits, and coaching and technical help.”

By a spokesperson, Rob Ries, the deputy government commissioner who oversees this system at Well being and Human Providers, declined to be interviewed.

The company has by no means totally evaluated the effectiveness of this system’s providers in its almost 20 years of existence.

It’s supposed to verify its contractors are assembly just a few benchmarks: what number of purchasers each serves and what number of they’ve referred to Medicaid and the Nurse-Household Partnership, a program that sends nurses to the houses of low-income first-time moms and has been confirmed to cut back maternal deaths. The Nurse-Household Partnership doesn’t obtain Options to Abortion funding.

In 2022, the Texas Being pregnant Care Community failed to satisfy two of three key benchmarks in its contract with the state: It didn’t serve sufficient purchasers and it didn’t refer sufficient of them to the nursing program. The state didn’t withhold or scale back its funding. McNamara disputed the primary declare, saying the state modified its methodology for counting purchasers, and mentioned the opposite benchmark was troublesome to hit as a result of too few purchasers certified for the nursing program.

In Might 2023, when lawmakers handed the invoice rebranding this system, the state additionally ordered the company to “establish indicators to measure the efficiency outcomes,” “require periodic reporting” and rent an out of doors social gathering to conduct impression evaluations.

The company declined to share particulars about its progress on these necessities besides to say that it’s asking for impression analysis providers. Data present the company has requested bids.

Lawmakers determined final 12 months towards enacting necessities that might guarantee sure providers have been evidence-based — confirmed by analysis to satisfy their targets — as an alternative siding with an argument that they might be too onerous for smaller nonprofits.

Texas’ six-week abortion ban took impact in 2021, and greater than 16,000 extra infants have been born within the state the next 12 months. Lecturers anticipate that development to proceed.

However the security internet for fogeys and infants is paper skinny.

Texas has the lowest price of insured ladies of reproductive age within the nation and ranks above the nationwide common for maternal deaths. It’s final in giving money help to households residing beneath the poverty line.

Moms instructed reporters they’re struggling to scrape collectively sufficient diapers and wipes to maintain their infants clear. A San Antonio diaper financial institution has tons of of households on its waitlist. Outdoors an Austin meals pantry, strains snake across the block.

Howard, the Austin state consultant, mentioned ProPublica and CBS Information’ findings present that this system wants extra oversight. “It’s unconscionable {that a} [Thriving Texas Families] supplier can be allowed to maintain thousands and thousands in reserve when there’s a super want for extra funding in entry to well being care providers,” she mentioned.