Federal tax filings show a Peninsula charity that runs food and housing programs in East Palo Alto reported more than $1 million in payments labeled as personal expenses on its most recent IRS return. The disclosure has rattled donors and local partners who rely on the agency’s services and has drawn scrutiny from nonprofit experts.
Tax filings raise red flags
As reported by CBS News Bay Area, Ecumenical Hunger Program’s federal Form 990 lists more than $1,000,000 described as payments for mortgages, car loans and rent. Experts who reviewed the filings told the outlet those entries look like potential inurement or misuse of charitable funds and said the disclosures are the kind of items that typically trigger closer review by auditors and regulators.
What the filings show
According to ProPublica, the charity reported $7,924,589 in revenue and $8,567,322 in expenses for the fiscal year ending June 2024, posting a net loss of $642,733 and flagging “excess benefit” and “conflict of interest” transactions on its filing. The organization’s own site says Ecumenical Hunger Program served nearly 20,000 people through emergency food programs in 2023, underscoring the scale of services at stake; EHP lists its programs and hours.
Payments to family and employees, and the board's response
Documents reviewed by reporters show line items labeled as personal expenses that include thousands paid to relatives and staff: more than $47,000 for the executive director’s sister and husband, over $35,000 for her daughter‑in‑law’s debts and mortgage, roughly $4,000 to her son for DMV fees, nearly $47,000 for an employee’s personal expenses including a year of rent, and more than $9,000 to a past employee, according to CBS News Bay Area. Board chairman Jim Anderson told the outlet the payments were made under a Family Sustainability Program started during COVID that ended in June 2024, and said the board is researching whether grants under that program were properly administered. Executive Director Lesia Preston declined an on‑camera interview and emailed the outlet that the issues “are still being researched and final determinations have not been made at this time.”
Possible enforcement and oversight
The California Attorney General’s Charitable Trusts section has authority to investigate charities and pursue remedies, including audits, civil penalties or receivership, when charitable assets appear to have been diverted, as laid out in state guidance for nonprofits. Attorneys and nonprofit compliance specialists note that transactions that benefit insiders (so‑called inurement or excess benefit transactions) can carry federal and state tax consequences as well as civil exposure if regulators determine they were improper; legal commentary from law firms and nonprofit advisors describes the types of corrective actions regulators may seek. Venable LLP has published guidance on how charities and boards should respond when questioned about possible diversion or misuse of funds.
Why this matters locally
Ecumenical Hunger Program is a major Peninsula safety‑net provider; donors, partner agencies and clients depend on its food, clothing and case‑management services, which is why community stakeholders are watching how the board and any regulators follow up. For now the board says it is reviewing the filings, and the clearest next steps for restoring donor confidence would be an independent audit or a public account of corrective actions if regulators or auditors identify problems.
