The King County Regional Homelessness Authority’s governing board, made up of elected officials from around the region, will meet today for a briefing and discussion on a damning forensic evaluation into the agency’s finances. The audit found potential misuse and commingling of restricted funds, spending that could not be accounted for, casual accounting practices, and lack of oversight and internal controls to protect against waste, abuse, and fraud.
The report covered a period ending in July 2025, when the agency’s cash balance was negative by $44.7 million. A few months after the audit began, agency CEO Kelly Kinnison laid off 13 staff, including the general counsel and chief financial officer. Neither position has been filled. At the same time, Kinnison hired five new staff, including three top executives, offsetting some of the savings from axing the agency’s attorney and the executive overseeing its finances.
Elected officials issued a flurry of statements ranging from alarm to calls for the KCRHA’s dissolution on Wednesday. Four Seattle-area leaders who expressed grave concerns—King County Executive Girmay Zahilay, Seattle Mayor Katie Wilson, and Seattle City Councilmembers Alexis Mercedes Rinck and Dionne Foster—are on the governing board.
PubliCola is supported entirely by readers like you. CLICK BELOW to become a one-time or monthly contributor.
In advance of today’s meeting, KCRHA’s Associate Director of Strategy, William Towey—who was among the new executives Kinnison hired last October—sent an email to KCRHA staff assuring them that the agency has “made meaningful progress [to] bring transparency to where we needed to improve and to help guide the work ahead.”
“Core operations are stronger, invoicing is now completed on time with significantly improved accuracy, we have implemented regular monthly financial close processes, and we have strengthened oversight of spending, including purchase cards”—spending by individual staffers that was done with little accountability or oversight, the audit found. “At the same time, the audit makes clear that more work is required, and we are already taking action to address those areas.”
Towey’s letter to staff emphasized that, “[i]mportantly, the audit did not find evidence of fraud or misuse of funds.” However, the audit explicitly says that the failure to find “large-scale fraud in the samples reviewed” does not mean a clear bill of health; “due to limitations in internal controls, the risk of fraud, waste, and abuse remains,” the audit notes.
Towey told KCRHA staff Kinnison herself requested the audit, a claim that sources inside the city as well as former KCRHA staff have disputed, saying that Kinnison’s former deputy, Simon Foster, requested it after discussions with the Seattle Human Services Department. (Foster was among the 13 laid-off staff.)
In a formal complaint last August, then-CFO James Rouse (one of the 13 staff let go last October) said Kinnison had not initiated the review and seemed unaccountably dismissive about the implications of a forensic audit, which is typically done when there’s a suspicion of wrongdoing, such as fraud.
Ordinarily, an agency under audit would have the opportunity to respond in writing to the audit and have the response released as part of the audit itself, but that didn’t happen in this case. Kinnison is expected to respond to the audit findings verbally at the KCRHA’s board meeting this afternoon.
One question that’s unlikely to come up at the meeting is what responsibility the elected officials on the board, as well as the KCRHA’s two main funders, the city and King County, had for ensuring its spending was in order and its accounting practices met basic standards. In 2024, the city and county gave the governing board more authority, but the officials on the board never took a particularly active role in questioning or overseeing the agency or its budget. Instead, the board generally rubber-stamped the budget after viewing a PowerPoint presentation, effectively ceding authority to the CEO and staff to hold themselves accountable.
On this week’s 🚨emergency episode🚨 of Seattle Nice, we discussed a damning new forensic report into the King County Regional Homelessness Authority’s finances, which revealed that the agency could not account for millions of dollars in public funds.
As I reported earlier today, the audit revealed that the KCRHA couldn’t account for $8 million; it also revealed an “administrative overspend” of more than $4 million, on top of a previously reported programmatic overspend of more than $6 million. Beyond the missing money, the repord raises serious concerns about the KCRHA’s accounting practices and use of restricted funds, some of which may have been used for unauthorized purposes.
We discussed what Sandeep described as the “overlapping failures” early in the agency’s history, when the founding CEO, Marc Dones, established a culture in which lived experience of homelessness took primacy over traditional government qualifications, a practice that pushed many of the people who had been managing homelessness contracts at the city of Seattle out and set the agency on a path of lackadaisical record-keeping, few formal financial controls, and accounting practices that included reconciling funds over chat, email, and constant revisions to Excel spreadsheets, rather than traditional government accounting practices.
PubliCola is supported entirely by readers like you. CLICK BELOW to become a one-time or monthly contributor.
A number of elected officials at the city and county have already called for the dissolution of the KCRHA, expressing outrage at the audit findings. That process, if it happens, will be long and arduous, and could spell the end of the much-touted “regional approach to homelessness,” which was the ostensible reason the KCRHA was created in the first place.
But as we also discussed, the city and county—the KCRHA’s two primary funders—also bear some responsibility for letting the agency’s finances and accounting get so out of hand and allowing their bank accounts to fall so far into the red. The KCRHA has long served as a bit of a punching bag for its primary funders, but it was it set up to struggle from the very start, when the city and county signed an agreement creating the agency that did not give KCRHA its own funding source, making it basically a pass-through agency that was occasionally allowed to do side missions—like the ill-fated “Partnership for Zero,” which was supposedly going to end unsheltered homelessness downtown.
The KCRHA’s board will meet at 3:00 on Friday, when it will hear from both agency CEO Kelly Kinnison and Clark Nuber, the agency hired by the city and county to do the forensic report. The public can tune in to the meeting on Zoom.
Advocates and city and Metro staff surround Mayor Katie Wilson at Wednesday’s Denny Way bus lane announcement.
By Erica C. Barnett
It took electing a mayor who knows what it’s like to be on a bus that’s crawling through gridlock traffic to finally address a choke point on Metro’s Route 8 between downtown and Capitol Hill. The bus, which runs from Seattle Center to Mount Baker via Capitol Hill and Judkins Park, gets stuck in traffic as it heads east from Seattle Center toward I-5, where cars stack up for blocks waiting to enter the freeway.
On Wednesday, Mayor Katie Wilson announced a two-phase plan to add a dedicated bus lane along the most congested part of Denny Way and create a new pathway to the South I-5 on-ramp that will divert cars off Denny at Boren, closing down the perpetually clogged pathway at Yale. The first phase, which will conclude later this month, will include a new south- and eastbound bus lane starting on Queen Anne Ave. and ending at 2nd Avenue, where the Seattle Department of Transportation will also add a bus “queue jump” lane to give buses priority.
Work will shut down for the World Cup in June and July and resume in August, when crews will paint nine new blocks of eastbound bus lanes on Dennybetween 5th Ave. downtown and Fairview Ave. N just before the freeway, where they’ll join up with an existing bus lane that will be shifted from its current location in the middle of the street over to the south curb. Yale Street, a notorious choke point, will no longer provide access to I-5; instead, southbound I-5 traffic will be funneled along Boren Ave.
The new bus lanes will be funded with $4 million from the Seattle Transportation Levy. The Seattle Transit Measure, which funds additional Metro service (and will be up for renewal this year), will fund additional service hours on the 8.
Source: SDOT
About 8,000 people ride the 8 every day, and about 26,000 ride the routes that travel along Queen Anne Ave. and Denny way just north of downtown, which include the 1, 2, 8, 13, 24, 33, and the RapidRide D Line.
On Wednesday, Wilson was surrounded by members of the Transit Riders Union, which she co-founded and directed before becoming mayor, and the Fix the L8coalition, which held a “race the L8” event last year in which people—including then-candidate Wilson— easily outpaced the snail-like bus while walking, dancing, unicycling, and hopscotching along the route.
Speaking at Wednesday’s announcement, Fix the L8 organizer Jason Li said he grew tired of hearing people say that Seattle can’t convert general-purpose lanes to bus lanes because we aren’t a big city with a thriving transit network like New York. “The thing is, the city has done this before, and it was a wild success,” Li Said. Just a couple of miles away, Madison Street used to be just like Denny—an arterial with two lanes in each direction that was chronically clogged with both local and I-5 traffic, and it had a slow and unreliable bus, just like route eight.” Think about what happens when you replace 5,000 cars with a fleet of 13 buses.”
PubliCola is supported entirely by readers like you. CLICK BELOW to become a one-time or monthly contributor.
Wilson, the first mayor in recent memory who does not own a car, recalled joining up with other transit advocacy groups to form the Move All Seattle Sustainably (MASS) Coalition to advocate for better mass transit in 2018. “I have to say, being stood up by your bus is honestly one of the most dispiriting experiences that you can have,” Wilson said.
“And I know every transit rider out there, here today and around the city, knows exactly what I mean. There’s just nothing that makes you feel [more] like you’re not valuable, like your time is not valuable. And it’s serious, right? You can lose a job because you’re half an hour late because your bus didn’t come. … This is our opportunity to start fixing this problem.”
As part of the Denny Way improvement exercise, SDOT came up with a list of nine additional congested corridors “where transit investment can deliver high impact benefits for riders and the city overall.” These routes, detailed in an SDOT memo, could be priorities for future investments in transit.
A forensic evaluation into the King County Regional Homelessness Authority’s finances found that the agency could not account for $13 million in public funding, according to a statement from Mayor Katie Wilson that also said “all options are on the table” when it comes to the embattled agency’s future. The city “will be pursuing immediate corrective action,” Wilson said. (The report is not a formal audit, but we’ll be using that term colloquially, with the recognition that it was officially an evaluation.)
In addition to the money that went missing—which includes $8 million the agency couldn’t account for, an administrative overspend of more than $4 million, and a previously reported programmatic overspend of more than $6 million—the report raises serious concerns about the KCRHA’s accounting practices and use of restricted funds, some of which may have been used for unauthorized purposes.
The report found, for example, that KCRHA used a single fund as a repository for earmarked money from various sources, then spent money from that fund to temporarily pay for other things, reimbursing the fund once the money came in for the contractor that received the original loan. A hypothetical example of this would be receiving federal dollars to pay for emergency shelter, using that money to pay for a homelessness diversion program while waiting for money to come in for that contract from the city, then putting the “loaned” federal money back in the pot so it goes to its original purpose.
“We were unable to determine to what extent restricted funds, intended for specific purposes, were used to temporarily cover unrelated costs,” the auditors wrote, “because the accounting records… obscured end-to-end traceability.” In general, they wrote, “we were unable to clearly determine if funds had been commingled or used for purposes other than intended due to traceability issues and use of large, complex reallocations.”
“Without clear tracking of funds, the organization could not easily demonstrate that cash was consistently used for its intended purpose. This increased the risk of potential noncompliance with Funder and contract requirements.”
PubliCola reported on the audit, by the accounting firm Clark Nuber, last week. The investigation, for which Seattle spent more than $600,000, started last August and was extended at the end of the year for additional work.
One issue the audit looked into was KCRHA’s routine negative budget balance, which requires the agency to borrow money, at interest, to pay its contractors every year. This balance, Clark Nuber found, went up and down throughout the year, including at times when the city had just loaned the KCRHA money to pay its bills. At times, the difference between what the agency owed and its cash on hand was close to $80 million.
The problem was caused, in part, by the fact that KCRHA often spent money it didn’t have yet, reconciling its accounts after the fact. The agency’s accounting staff also frequently submitted invoices that had significant errors; correcting those errors meant the agency went longer without getting paid, and relied heavily on borrowed money to pay providers.
“We would have expected that advance funds would have supported ongoing positive cash flow,” the auditors wrote. “However, we also noted that expenditures often occurred well before receipt of advances and were retroactively applied, meaning that expenditures were made before actual advance cash was available.”
“Erroneous invoices were rejected by [the city and county] and sent back to KCRHA for correction. Depending on the issue, the correction process was lengthy and administratively burdensome,” the auditors found. Twenty-five of the 29 sample invoices Clark Nuber inspected included errors, and all failed to include a mandatory authorization form.
According to the audit, had no consistent accounting system and routinely made errors that prevented payments from going out. In a departure from best practices, the agency didn’t reconcile its accounts at the end of each month, and did not use a single accounting system to track corrections, changes, and amendments to accounts.
Instead, the $200 million agency relied on “institutional knowledge,” “manual workarounds,” and “informal processes,” such as emails and “thousands” of edits to widely accessible Excel spreadsheet, to “complete core cash-related processes, including bank reconciliations.” In many cases, the same person was able to enter, revise, and delete individual transactions with no clear oversight.
“Cash position awareness appeared to rely primarily on informal reporting, manual tracking, and point‑in‑time statements provided after the fact by the County, rather than on forward-looking, system‑driven reporting,” the audit found.
“Issues and reconciling items were frequently resolved through informal channels such as chat messages rather than through retained workpapers or system documentation,” the audit found. “Nor did there appear to be standard internal controls to ensure there was no fraud, waste, or abuse.” In one example the audit found, the same person was responsible for entering information about cash flows and certifying that the information was correct.
The audit also found potential issues with prepaid gift cards given out to participants in the agency’s biannual Point In Time count, which relies on volunteer recruitment rather than a physical count of homeless individuals, and the use of purchase (credit) cards by staff. Typically, the report notes, these cards are only used for small, “incidental” spending, but KCRHA staff charged more than $1 million over the approximately four-year audit period, including for office furniture and clothing, raising questions about whether the cards were used properly. The $1.1 million included about $360,000 in expenditures for an ill-fated hotel program run by the Lived Experience Coalition, which PubliCola covered extensively in 2023.
In a sample of 14 “high-dollar” purchases, Clark Nuber found that every purchase raised concerns, including purchases by someone other than the cardholder, missing receipts, and approvals by people who were not authorized to approve such expenses.
King County Executive Girmay Zahilay and Wilson sent a joint letter to Kinnison spelling out steps to establish “clear fiscal controls and accountability for taxpayer funds, and directing KCRHA to “act swiftly to address identified challenges” from the report.” The letter says the KCRHA needs to take specific steps such as separating accounting duties so that the same person isn’t overseeing expenditures and compliance checks; setting strict rules for employee reimbursements and gift cards; and provide a written correction plan for the issues raised in the report.
Late Wednesday afternoon, Kinnison sent a letter to the agency’s governing board late this afternoon, which said that Kinnison had requested the audit “to ensure transparency and establish a clear, independent understanding” of what she called “concerns related to our financial systems and reporting during the agency’s early formation.” (Multiple sources familiar with how the audit came about disputed this characterization).
The audit covers the period through July 2025.
PubliCola is supported entirely by readers like you. CLICK BELOW to become a one-time or monthly contributor.
Shortly after this post originally ran, King County Executive Girmay Zahilay’s office released the audit along with a joint letter from Zahilay and Wilson saying the two executives “expect KCRHA to act swiftly to address identified challenges” from the report, with a response
In her letter, Kinnison said the audit’s negative findings “are concentrated in KCRHA’s early formation period and reflect structural challenges associated with startup conditions, the pandemic response, an initially fragmented governance framework, and a highly complex funding model. Since that time, we have made meaningful progress. Governance has been restructured, and core operations — including contracts, data systems, and provider coordination — are functioning more effectively. Our financial systems have also improved, though additional strengthening is still needed.”
The report noted that although many of the issues arose under earlier CEOs, including controversial founding CEO Marc Dones, many of the problems have not been corrected since current CEO Kelly Kinnison was hired in August 2024. “Weaknesses remain in the current state, including issues related to process workflows, accounting methodology and reporting transparency, invoicing and receivables management, budgeting management, reliable supporting documentation, governance and oversight, and effectiveness of internal controls,” the report found.
The auditors also noted that Kinnison “was absent from most ongoing bi-weekly project update meetings” about the audit, forcing the auditors to work with lower-level managers to answer questions and address issues.
Two Seattle City Councilmembers, Maritza Rivera and Bob Kettle, condemned the agency’s financial, and both Rivera and King County Councilmember Rod Dembowski called for the KCRHA’s dissolution.
“The results of the recent King County Regional Homelessness Authority audit are damning,” Kettle said in a statement. “It shows an epic, and consistent, failure of leadership at the top of the agency —especially at its start. It also reveals the failure of leadership of the county and city. The audit reveals troubling systemic issues that can no longer be ignored if we are to address the homelessness and public safety crisis in Seattle effectively.”
Rivera went further. “I am shocked and outraged after seeing the results of the forensic evaluation of the King County Regional Homelessness Authority, which I just received today,” she said in a statement. “It shows an egregious mismanagement of funds and an unacceptable lack of financial accountability.
“KCRHA has a history of dysfunction and inefficiency, and it is time to acknowledge that it has failed in its mission. I am calling for Mayor Wilson to provide a plan for the dismantling of KCRHA as soon as possible, and a commitment to work with City Council to determine how Seattle will move forward in meeting its shelter and housing needs.”
Later on Wednesday evening, City Councilmembers Alexis Mercedes Rinck and Dionne Foster sent a more measured joint statement, saying the audit findings are “serious, unacceptable and demand immediate action and accountability.”
Asked about the possible dissolution of the KCRHA on Wednesday night, Rinck said, “I think we can do regionalism without having a whole separate agency” overseeing homelessness contracts. The process of setting up a regional entity has shown that Seattle, King County, and other cities can coordinate and talk to each other about their differing needs without having what amounts to a separate pass-through agency handling all the region’s spending, she said.
Under the interlocal agreement that established the authority, the city and county must take at least one year to dissolve the agency if they decide to dismantle it rather than try to reform and save it. The KCRHA, city, and county would spend much of that time transferring the contracts KCRHA manages back to the city’s Human Services Department and the county’s Department of Community and Human Services.
Kinnison’s letter to the board says most of the money that is unaccounted for is made up of “unreconciled receivables”—services that were delivered but “require further reconciliation within the accounting system.” In general, Kinnison told the board, the agency did not lose or misuse funds.
The KCRHA’s governing board will take up the audit findings at its meeting on Friday.
The Seattle Times failed to credit PubliCola’s original reporting on King County Assessor John Arthur Wilson yesterday in a story titled “King County Assessor In Hot Water After Social Media Post.”
The King County Council discussed our reporting yesterday before voting to send a letter to Wilson demanding his resignation in light of new charges against him for allegedly stalking his ex-fiancée, Lee Keller, and violating a restraining order.
On Monday, April 20, PubliCola broke a story about two Instagram and Facebook posts in which Wilson appeared to flippantly celebrate a judge’s decision that he would not have to wear an ankle monitor, overturning an earlier order after Wilson claimed he had to to fully submerge both his legs every day due to a medical condition called lymphedema. The monitor was supposed to ensure Keller knew right away if Wilson came within 1,000 feet of her.
As we reported, both posts showed Wilson, shirtless and smiling at the camera, in a hot tub. The first, posted on Wednesday, April 15—the day the judge lifted the ankle monitor requirement— read, “What a great night to just soak in the tub and let your cares float away.” The second, posted two days later, said, “Great to soak my legs after a productive and successful week.”
Our story circulated widely on social media and was one among the reasons county council members said it was time for Wilson to step down. Prior to voting on the letter Tuesday afternoon, County Councilmembers Sarah Perry and Teresa Mosqueda both cited PubliCola’s coverage directly. “I want to appreciate the reporting from Erica C. Barnett,” Mosqueda said, “in terms of the journalism that was done after that court hearing.”
The Seattle Times reported on that meeting and the social media posts, presenting the news as their own original coverage, last night, and included a screen shot identical to one of the two PubliCola posted on Monday. They did not link PubliCola’s coverage or credit our work, despite the fact that it had been widely circulated and even cited directly in the meeting the Times was covering.
This was not the first, or even the twentieth, time the Seattle Times has failed to credit PubliCola’s original reporting when writing their own followups on stories we broke.
Editorially, the Seattle Times often complains about the demise of local news reporting in areas outside Seattle, focusing exclusively on the closure of small print newspapers. In their own city, however, they seem more than happy to lift smaller outlets’ work—not just from PubliCola but the Urbanist, Capitol Hill Seattle, and many smaller outlets. Editors at the Times, who are ultimately responsible for deciding whether to credit outlets where stories originated, have ignored every request for a link and credit that I’ve ever sent them, demonstrating that they think it’s fine to run roughshod over local reporters in their own backyard.
While it might sound like a small thing—a series of rude social media posts by a local politician is hardly Watergate—the cumulative impact of the Times’ routine failure to credit small outlets like ours is significant. Compared to PubliCola, the Seattle Times is a behemoth, with revenue from ads, sponsorships, foundation grants, and paid subscriptions to both their print paper and their paywalled online content. When the local paper uses PubliCola’s work without credit, our original reporting becomes invisible—Google results promote the bigger outlet, other outlets link to the Times, and before you know it, it’s their story, even when it was our reporting.
This, of course, is the part where I encourage you to support PubliCola, and also all the other scrappy local outlets that are out here busting our asses to report news the big daily paper is more than happy to ignore—or scoop up a day after we publish and present as their own. With rare exceptions, we all see each other as part of an ecosystem, covering stories and neighborhoods that the big daily paper and TV stations ignore. The Seattle Times’ management has shown over and over again that they don’t see itself as part of this same ecosystem, which is a shame. If they’re the only one left standing, think of all the stories that won’t get covered.
Members of the PROTEC17 union, including King County employees, held a demonstration in the lobby of King County’s Chinook building on Tuesday to protest King County Executive Girmay Zahilay’s three-day-a-week return to office (RTO) mandate, which county employees have called punitive, expensive, and counterproductive.
Carrying signs with slogans such as “Communities not cubicles,” “King County is Bigger than Seattle,” and—memorably—”I don’t have a desk,” the staffers showed up with a giant “blank check representing the expense King County will incur to rent private office space so that employees, including many who were hired as fully remote workers, will have a place to sit downtown.
A staffer for Zahilay showed up in the lobby to accept the check and said she would make sure he gets it.
The county gave up much of its office space during the pandemic and agreed to allow many employees to work from home indefinitely under an agreement called “Green Where You Work.” Now, many county employees don’t have desks to “return” to as part of the “return to office” plan—a misnomer for county employees who were hired over the past six years and have never had a physical office downtown.
David Dahl, a capital projects manager for the Department of Natural Resources and Parks, was hired as a remote worker for a job that takes him to sites across King County. Living in Seattle, he said, might make it relatively easy for him to come downtown to meet the three-day mandate, but for many of his coworkers, the extra trip would add hours of unnecessary commute time to jobs they could previously do from the part of the county where they lived.
“We have a lot of people who have projects in the south end and live in Auburn or Kent or Tacoma, and they can easily get to those projects in a very short amount of time,” Dahl said, “whereas if they have to come into an office and then go back to a park site, that’s a ton of driving to do something that should be pretty simple.”
King County is much larger than the city of Seattle, where many workers also chafed at return-to-office mandates. The county covers more than 2,100 square miles, and many staffers live far away from Seattle, in areas where housing is more affordable.
Moving more than 1,000 employees into “a space with maybe 80 desks” would be impossible, Dahl said, and the new spaces the county has come up with at the King Street Center aren’t up to ergonomic standards. “It frankly should be the bare minimum that if you’re asking someone to work in an office, you should provide them an ergonomic place to sit and to do their work,” Dahl said.
Another DNRP employee, Brad Moore, said requiring county employees to travel to downtown Seattle for work would lead an “extremely high and unknown cost” for office space “that we feel could go towards much better things—for example, the public service that we’re all supposed to be providing.”
Moore, who lives in Shoreline with his extended family and was hired as a fully remote staffer, said the mandate will add a one-way transit commute of between 45 minutes and an hour to every work day. That will make it harder for Moore to help take care of kids in the family and help his wife, who has mobility issues, get to work.
But Moore added that the situation is much worse for some of his coworkers, who live in places like Everett and “are being told that they have to come into the office two or three days a week. I mean, in the morning, it could take two hours,” Moore said.
Donate to The C Is for Crank's Laptop Retirement Fund
My computer is the single most important piece of equipment I own, and for much of the last five years, I’ve relied on my trusty 2015 MacBook Pro to write and edit posts, tweet up a storm from public meetings, file public records requests, edit transcripts and photos, and generally keep The C Is for Crank in operation. Now it’s time to retire my old machine and trade it in for a newer model.
I’d really appreciate any help my readers are willing to provide to help me defray the cost of this critical piece of office equipment. A new, faster machine (not to mention one without—ahem—an ever-so-slightly cracked screen) will make it easier to bring The C Is for Crank to you every day. My back will also be grateful as I rush from candidate debate to city council meeting to coffee shop back to City Hall. I accept contributions via Venmo (Erica-Barnett-7), Paypal, and by check at the address on my Support page. Thank you so much for your support!
