By Erica C. Barnett
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.
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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.
