By Erica C. Barnett
We Are In, a key player in Seattle’s effort to reduce homelessness, has imploded.
The public-private partnership— an umbrella group for philanthropic donors that funded the recently dismantled Partnership for Zero program—has fired or furloughed all its staff and appears to be on the brink of closing down.
On December 13, the group’s then-fiscal sponsor, Building Changes, unilaterally fired We Are In’s executive director, Felicia Salcedo, and communications director, Erik Houser. Then, last week, El Gaucho owner Chad McKay, representing businesses on We Are In’s board, told the group’s three remaining staffers were told they were being “furloughed” without pay, starting immediately.
The We Are In staffers—who were assured by We Are In board member (and Chief Seattle Club director) Derrick Belgarde in a mid-December email that “your jobs are secure”—did not receive severance.
Partnership for Zero was the King County Regional Homelessness Authority’s effort to end unsheltered homelessness downtown by moving people directly from the street into mostly market-rate housing; the program collapsed last year after housing just 230 people, and the KCRHA laid off most of the formerly homeless people hired to implement it.
We Are In’s apparent implosion, which has not been previously reported, leaves the future of We Are In—as well as the role philanthropic donors, like the Raikes and Gates Foundations, will play in addressing homelessness—in doubt.
If We Are In collapses, it will have ramifications beyond the organization itself. Seattle Mayor Bruce Harrell, who has been less than enthusiastic about KCRHA’s past requests for large budget increases, has said solving homelessness must include successful public-private partnerships between private donors and local governments. If those private donors are throwing up their hands on homelessness, it could bode poorly for the future of the KCRHA.
We Are In’s previous fiscal sponsor, Building Changes, said the problem was a simple “cash flow issue.” But others familiar with the situation say there are other factors that contributed to the firings and furloughs.
Despite Partnership for Zero’s demise, We Are In was supposed to continue, and receive new funding from its philanthropic backers, under a new fiscal sponsor, Panorama Global. (A fiscal sponsor is a nonprofit that handles finances and has some control over operations for an organization that does not have nonprofit status.) By January, Building Changes was supposed to begin transferring a total of $1.2 million to Panorama for We Are In to continue operating, and business and philanthropic donors were expected to kick in more funds this year. The initial transfers would have including funding from Amazon, Microsoft, the Ballmer Group, the Campion Foundation, the Gates Foundation, and the Raikes Foundation.
Building Changes director Daniel Zavala did not return a call for comment. In mid-December, after Salcedo and Houser were fired, Zavala told PubliCola that Building Changes’ contract to sponsor We Are In “was always slated to be up for renewal” on December 31, “and in conversations around renewal the [We Are In] advisory board decided to move to another fiscal sponsor as of next year.” Others involved with We Are In said the decision seemed abrupt, and the transition to Panorama expedited.
Accounts vary widely about what led to the firings and furloughs.
According to a January 11 email from Zavala to We Are In staff, the problem was a simple “cash flow issue.” We Are In, Zavala wrote, spent “far more than was budgeted from its unrestricted general operating fund”: More than $1 million, including more than $700,000 in excess funds on consultants and other “professional services.” A subsequent email from Panorama Global reiterated this claim, referring to an operational “deficit” and a lack of commitments from We Are In’s funders. However, multiple sources familiar with We Are In’s finances said there was no operational deficit when Zavala fired Houser and Salcedo in mid-December.
Among the consultants We Are In hired were Kelly Evans, a longtime Democratic political consultant, Blue Wave Partners, a Democratic fundraising firm, and Rally, a communications firm, which reportedly received $15,000 for a film promoting Partnership for Zero that never ran because the program was terminated. The organization was reportedly considering a homelessness-related ballot measure in the fall.
For context, the total of all private donations for the initial Partnership for Zero plan was $10 million, which would mean We Are In had overspent by an amount equal to 10 percent of its initial budget.
But others familiar with the situation say there are other factors that contributed to the firings and furloughs.
For instance: On December 19, six days after Building Changes fired Salcedo and Houser, the four remaining staff members sent a memo to the entire We Are In board alleging discriminatory hiring and pay practices. The board includes representatives from philanthropy, business, advocacy groups, and people with lived experience of homelessness.
In the memo, the staffers alleged that Salcedo expanded one staffer’s job duties substantially but would not give them a raise or promotion; that We Are In engaged in “discriminatory hiring practices favoring white staff and applicants”‘; that “senior staff and consultant[s]” met and made financial without including or telling key staff; and that We Are In failed to pay the Lived Experience Coalition and other groups for their work despite agreeing in writing to do so. Additionally, We Are In did not have a written anti-discrimination policy, and there was no HR department inside the agency; HR complaints were supposed to go to Building Changes, the fiscal sponsor.
In their memo, the We Are In staffers requested a full investigation of the discrimination claims, payment to unpaid contractors, and a financial audit of the organization, among other actions. Instead, on January 11, they were all put on indefinite furlough.
The memo also accuses Salcedo and Houser of providing media outlets an initial draft of an audit into an ill-fated hotel shelter program run by the LEC in order to “to shape the narrative of the hoteling program” in a way that made it look like the LEC was solely to blame for its failure.
The audit was critical of the LEC, but also of the United Way of King County, the KCRHA, and Building Changes, which was also the LEC’s fiscal sponsor at the time. The LEC accused Building Changes of withholding financial information, something We Are In officials also reportedly complained about. Although the LEC hotels were supposed to be separate from Partnership for Zero, KCRHA outreach workers used these hotel rooms to shelter more than 120 Partnership for Zero clients, effectively shoring up the We Are In-backed program with Lived Experience Coalition funding.
A final version of the audit—never released—focused more on the systemic issues behind the hotel program’s collapse and included input from the LEC.
Houser and Salcedo did not respond to requests for comment.
In their memo, the We Are In staffers requested a full investigation of the discrimination claims, payment to unpaid contractors, and a financial audit of the organization, among other actions aimed at “reconciliation, rectifying the harm caused, and steering us back toward our foundational mission and core values.”
Instead, on January 11, they were all put on indefinite furlough.
That same day, Melissa Espinoza, We Are In’s managing director for strategic investments, sent an email to We Are In’s board calling the furloughs “a retaliatory response” and asking for a “prompt third-party neutral investigation” of the allegations.
It’s unclear whether We Are In’s board will consider undertaking (or funding) such an investigation. Only one of the board members PubliCola contacted last week, Paula Carvalho from the Raikes Foundation, responded, through a spokesperson for Raikes who provided this statement: “The Raikes Foundation is disappointed by the challenges facing our partner We Are In. We remain committed to ensuring housing stability for youth and the regional approach to prevent and end homelessness in King County.”
A draft of the agreement transferring fiscal sponsorship of We Are In from Building Changes to Panorama Global says that in addition to the initial $1.2 million transfer, We Are In was expecting to receive new funding from the Campion Foundation and the Gates Foundation in 2024.
Anne Martens, a spokeswoman for the KCRHA, said Friday that she was “not in the loop” on what was going on at We Are In, but that KCRHA is still talking with them about future grant funding. “It’s a philanthropic project, and if any decisions were to be made it would be by their funders,” Martens said.