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This story was reported in partnership with CBS Information.
12 months after yr, whereas Roe v. Wade was the regulation of the land, Texas legislators handed measures limiting entry to abortion — who might have one, how and the place. And with the identical cadence, they added tens of millions of {dollars} to a program designed to discourage individuals from terminating pregnancies.
Their finances infusions for the Options to Abortion program grew with virtually each legislative session — first regularly, 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 essentially unlawful in Texas, lawmakers say they’ve shifted the aim of this system, and its tens of millions of {dollars}, to supporting households affected by the state’s ban.
Within the phrases of Rep. Jeff Leach, a Republican from Plano, the purpose is to “provide the full support and resources of the state government … to come alongside of these thousands of women and their families who might find themselves with unexpected, 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 Texas Well being and Human Companies Fee, which oversees this system, don’t know the specifics of how tens of tens of millions of taxpayer {dollars} are being spent or whether or not that cash is addressing households’ wants.
In some circumstances, taxpayers are paying these teams to distribute items they obtained at no cost, permitting anti-abortion facilities — which are sometimes known as “crisis pregnancy centers” and could also be set as much as seem like clinics that carry out abortions — to invoice $14 handy out a few donated diapers.
Distributing a single pamphlet can web the identical $14 price. The state has paid the charities tens of millions to distribute such “educational materials” about matters together with parenting and adoption; it might’t say precisely what number of tens of millions as a result of it doesn’t acquire information on the products it’s paying for. State officers declined to supply examples of the supplies by publication time, and reporters who visited being pregnant facilities had been turned away.
As they restricted entry to abortion, lawmakers additionally poured cash right into a program that was first known as Options to Abortion and lately rebranded as Thriving Texas Households. This system funds counseling, child objects and brochures, however not medical care.
Roe v. Wade overturned in June 2022
Texas passes six-week abortion ban in Sept. 2021
Funding for Options to Abortion
Funding for Options
to Abortion
Texas passes six-week abortion ban in Sept. 2021
Roe v. Wade overturned in June 2022
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 affect of this system.
One yr later, Well being and Human Companies says it’s “working to implement the provisions of the law.” Company spokespeople answered some questions however declined interview requests. They mentioned their predominant contractor, Texas Being pregnant Care Community, was chargeable 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 govt 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 Heart of the Coastal Bend in Corpus Christi, as an example, constructed up a $1.6 million surplus from 2020 to 2022. Government 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 companies, Neeley mentioned, “what they do with the dollars in their bank accounts is not connected” to the Thriving Texas Households program. “It is no longer taxpayer money.”
The state mentioned these funds are, in reality, taxpayer cash. “HHSC takes stewardship of taxpayer dollars, appropriated by the Legislature, very seriously by ensuring they are used for their intended purpose,” a spokesperson mentioned.
None of that has precipitated lawmakers to cease the money from flowing. The truth is, final yr they blocked necessities to make sure sure companies had 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 preserve investing in it. The truth is, he mentioned, “We’re going to double down.”
What’s extra, lawmakers across the nation are contemplating applications modeled on Options to Abortion.
Final yr, Tennessee lawmakers directed $20 million to fund disaster being pregnant facilities and related nonprofits. And Florida enacted a 6-week abortion ban whereas together with in the identical invoice a $25 million allocation to help disaster being pregnant facilities. John McNamara, a longtime chief of Texas Being pregnant Care Community, has been working to start out related 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 resources from families who are in need,” 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 help 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 most important, 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 supply 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 Heart 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 tips.
Texas Being pregnant Care Community manages dozens of subcontractors that present counseling and parenting lessons and that distribute materials support equivalent to diapers and system. Mother and father should take a category or endure counseling earlier than they’ll get these items.
The state may be charged $14 every time considered one of these subcontractors distributes objects from considered one of a number of classes, together with meals, clothes and academic supplies. Which means the distribution of a few academic pamphlets might web the identical $14 price 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 Heart, close to the Texas-Mexico border, obtained 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 these things.
McAllen Being pregnant Heart and different Texas Being pregnant Care Community subcontractors had been paid greater than $54 million from 2021 to 2023 for distributing this stuff, in line with information.
How a lot of that was for handing out pamphlets? The state mentioned it didn’t know; it doesn’t acquire information on the portions or sorts of objects offered to purchasers or whether or not they’re important objects like diapers or simply pamphlets, making it inconceivable for the general public to know the way tax {dollars} had been spent.
Neeley mentioned in an electronic mail that academic supplies like pamphlets solely accounted for 12% of the cash reimbursed on this class final yr, 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 way in which 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 cost 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 marketing consultant over the previous three many years. It “can run fast and loose if you’re not careful,” he mentioned.
Even when nonprofits distribute objects they received at no cost or near it, the state will nonetheless reimburse them. Take Viola’s Home, a being pregnant middle and maternity residence in Dallas. Data present that it pays a close-by diaper financial institution an administrative price 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 value the middle simply over 1 / 4.
However earlier than they’ll get these diapers, dad and mom should take a category. The middle may 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 yr, she proposed diverting 2% of Thriving Texas Households’ funding on to diaper banks, however the proposal failed.
Data present that in fiscal yr 2023, Viola’s Home obtained greater than $1 million from the state in reimbursements for materials help and academic objects plus one other $1.7 million for lessons. Government 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 “could never cover everything that we do.”
In some circumstances, 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 observe Inner Income Service guidelines for nonprofits.
McAllen Being pregnant Heart obtained $3.5 million in taxpayer cash from Texas Being pregnant Care Community over three years, nevertheless it spent lower than $1 million on program companies, in line with annual returns it filed with the IRS. In the meantime, $2.1 million was added to the group’s belongings, principally in money. Its govt director, Angie Arviso, requested a reporter who visited in particular person to submit questions in writing, however she by no means responded.
The nonprofit McAllen Being pregnant Heart is a case examine displaying how anti-abortion facilities can amass a surplus from the Options to Abortion program, which is now known as Thriving Texas Households.
Income from the Texas
Being pregnant Care Community
Income from different sources
Income from different sources
Income from the Texas Being pregnant Care Community
“This is a policy choice Texas has made,” mentioned Samuel Brunson, affiliate dean for school analysis and growth on the Loyola College Chicago Faculty of Regulation, who researches and writes concerning the federal earnings tax and nonprofit organizations. “It has chosen to redistribute money from taxpayers to the reserve funds of private nonprofit organizations.”
Tax consultants say that’s problematic. “Why would you give money to a recipient that is not 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 still the government buying something,” 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 were in the auditor’s office, that’s where I would start 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 lower off funding to considered 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 offered 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 give parents two to three diapers at a time, then she would bill TPCN,” mentioned Campbell.
Reed declined to remark to a ProPublica reporter or to reply follow-up questions by way of electronic mail or textual content. Neeley, the Texas Being pregnant Care Community’s govt director, mentioned the being pregnant middle 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 chargeable for monitoring how A New Life for a New Technology spent its {dollars}: “The power to investigate these matters of how nonprofits manage their own funds is reserved statutorily to the Texas Attorney General and the IRS.”
The Texas lawyer basic’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 basic and that the Texas Being pregnant Care Community submitted a report detailing the way it monitored the subcontractor.
The state requires contractors to submit unbiased monetary audits in the event that they obtain a minimum of $750,000 in state cash; Texas Being pregnant Care Community meets this threshold. Nonetheless, its dozens of subcontractors don’t should submit these audits — one thing consultants in nonprofit practices mentioned ought to be required. Within the fiscal yr earlier than the alleged misspending got here to mild, A New Life for a New Technology obtained greater than $1 million in reimbursements from the state, information present.
When ProPublica and CBS Information requested how the Well being and Human Companies Fee detects fraud or misuse of taxpayer funds, Jennifer Ruffcorn, a fee spokesperson, mentioned the company “performs oversight through various methods, which may include fiscal, programmatic, and administrative monitoring, enhanced monitoring, desk reviews, financial reconciliations, on-site visits, and training and technical assistance.”
By means of a spokesperson, Rob Ries, the deputy govt commissioner who oversees this system at Well being and Human Companies, declined to be interviewed.
The company has by no means completely evaluated the effectiveness of this system’s companies in its practically 20 years of existence.
It’s supposed to verify its contractors are assembly just a few benchmarks: what number of purchasers every one serves and what number of they’ve referred to Medicaid and the Nurse-Household Partnership, a program that sends nurses to the properties of low-income first-time moms and has been confirmed to scale 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 “identify indicators to measure the performance outcomes,” “require periodic reporting” and rent an outdoor social gathering to conduct affect evaluations.
The company declined to share particulars about its progress on these necessities besides to say that it’s asking for affect analysis companies. Data present the company has requested bids.
Lawmakers determined final yr towards enacting necessities that might guarantee sure companies had been evidence-based — confirmed by analysis to satisfy their targets — as a substitute siding with an argument that they’d be too onerous for smaller nonprofits.
Texas’ six-week abortion ban took impact in 2021, and greater than 16,000 extra infants had been born within the state the next yr. Lecturers anticipate that pattern to proceed.
However the security web for folks and infants is paper skinny.
Texas has the lowest charge 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 informed 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. Exterior an Austin meals pantry, traces snake across the block.
Howard, the Austin state consultant, mentioned ProPublica and CBS Information’ findings present that this system wants extra oversight. “It is unconscionable that a [Thriving Texas Families] provider would be allowed to keep millions in reserve when there is a tremendous need for more investment in access to health care services,” she mentioned.
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