Formal Complaint against Pride St. Louis, Inc.
Financial mismanagement & malfeasance by the board
In Summer 2019 I conducted research into the operations of Pride St. Louis, Inc., the organization that mounts the city’s annual Pride Festival and runs an LGBTQIA+ community center. I published two preliminary stories on Medium (here and here). At the urging of many local LGBTQIA+ community members, I submitted the findings of my work in a formal complaint to the Missouri Attorney General, the state office that regulates non-profit corporations registered in Missouri. I also shared it on social media and sent a copy to the Pride St. Louis, Inc. board of directors. Fortunately I have tenure (and a union), which protected me when the board filed a complaint with my university.
Since then, I have closed the social media accounts through which I shared the complaint document but I’m publishing the text here so it’s accessible to the general public. By law, the report is in the public domain. The formatting has been changed slightly for this publication. The original document can be downloaded here. All documents supporting my claims in the complaint can be accessed here. My personal contact info has been redacted from both versions (for obvious reasons). — MM (6Feb2020)
Missouri Attorney General’s Office
Consumer Protection Unit
P.O. Box 899
Jefferson City MO 65102
RE: Complaint No. CC-2019–07–007152
9 August 2019
To whom it may concern,
As a longtime St. Louis resident and member of the LGBTQIA+ community, I’m writing to share concerns about the activities of the Board of Directors of Pride St. Louis, Inc. (EIN: 43–1331630; MO corp. #00027604)), a 501(c)(3) non-profit organization incorporated in the State of Missouri. These concerns regard mission fulfillment, financial management and oversight, responsiveness to records request, mandatory reporting, conflicts of interest, and transparency and general conduct of the Board. As described below, the Board’s activities have violated Missouri Sunshine Law, IRS regulations, the organization’s own by-laws, and several sections of Missouri Revised Statutes Title XXIII, ch. 355 — Nonprofit corporation law. In several places, the Board’s actions reflect negligence and willful ignorance that rises to the level of malfeasance.
I am requesting your office initiate a fact-finding investigation of the organization’s activities with the goal of bringing Pride St. Louis, Inc. into compliance with state and federal law, its organizational by-laws, and best practices for non-profit (“public benefit”) organizations. For the sake of brevity, I am not including documents that substantiate the following claims but am happy to provide them upon request.
Background
Pride St. Louis, Inc. is a 41-year old non-profit originally created for the purpose of organizing the area’s gay and lesbian Pride Parade. The organization has no paid staff and is entirely run by volunteers. Today, the organization has three main programs: an annual Pride Parade and Pride Festival, and PrideCenter, a community center opened in late 2016 that operates out of Pride St. Louis, Inc.’s principal office.
For the past five years, Pride St. Louis, Inc. has been embroiled in a series of controversies that have harmed and divided the community the organization was created to serve and represent. In 2015, a member of the St. Louis Metro Transgender Umbrella Group (MTUG) published an open letter to the Board of Pride St. Louis, Inc. describing harassment, mistreatment, and discrimination of the group when it attempted to participate in the 2015 St. Louis Pride Parade. In response, Pride St. Louis, Inc. offered an award to the Executive Director of MTUG in 2017, but he refused the award until the Board and volunteers of Pride St. Louis, Inc. underwent diversity training and made other changes to become more inclusive of the entire LGBTQIA+ community (including limiting the role of police in the Pride Parade).
In 2017, experiencing several years of accumulating debt and the loss of a major corporate sponsor, the organization’s Board voted to charge an entrance fee to that year’s PrideFest. The full reasons for this action were not communicated to the community and there was immediate pushback, with charges that the Board was being insensitive to the financial condition of its community. Some of the most vocal criticism came from people of color and transgender people, who constitute some of the most marginalized members of the LGBTQIA+ community. Under growing pressure, the Board reversed itself and instead raised additional money at PrideFest by increasing alcohol prices.
In late 2018, the Director of the Pride Parade (a Board seat at Pride St. Louis, Inc.) met with three members of the Board’s Executive Committee to discuss the possibility of asking armed and uniformed St. Louis Police Department (SLPD) officers not participate in the 2019 Pride Parade. That request was framed as an opportunity for SLPD to offer a symbolic gesture on the 50th anniversary of the Stonewall Uprising. (Pride parades worldwide commemorate an uprising in late June 1969 against a police raid of the Stonewall Inn, a gay bar in Greenwich Village, New York City). By mid-May 2019, the President of the Board of Pride St. Louis, Inc. received word that there was an agreement in principle with SLPD: armed/uniformed officers would not walk in the parade but were still welcome in other attire.
During the organization’s Pride Kickoff event on 1 June 2019, the Board’s Director of Compliance convened an unannounced meeting of the Board, informed the entire Board of the agreement with SLPD, and asked the Board to vote on making a public statement. (The Board voted not to do so.) This was the first time the entire Board was made aware that armed/uniformed SLPD officers had been asked to not walk in the Pride Parade. (No minutes of that meeting were taken, and none have been provided after several records requests.) On 3 June 2019, during a Festival Committee meeting that included most of the Board, those present agreed that the 1 June vote had been inappropriate on procedural grounds and would be disregarded. (Minutes of this meeting have been requested but not provided.)
Unfortunately, word leaked to the media and Pride St. Louis, Inc. was forced to issue a press release but not before local print, digital, radio, and TV media had (erroneously) reported, “Pride Bans Police from Parade!” Even the New York Times reported the story. The blowback from both the LGBTQIA+ (and wider) community, particularly among law enforcement supporters, was immediate and massive. Board members received death threats, corporate sponsors withdrew or threatened to withdraw sponsorship, and St. Louis City Mayor Lyda Krewson asked the Board to reconsider the matter. On 17 June 2019, the Board convened an unannounced Special Meeting that was closed to the public, discussed the pushback and voted first, to ban the police then, to reverse that decision (since no formal vote had previously been taken on the matter by the full Board). That vote was reported to the media in a televised press conference with Board members, City officials, and SLPD representatives. Then, in its private Facebook group, the entire Board agreed to go silent on the topic, despite increasingly-loud community calls for explanation about the motives and justifications for the 17 June vote.
Because police harassment and discrimination against transgender people is an ongoing issue, in the wake of the Board’s decision MTUG withdrew from the 2019 Pride Parade and PrideFest, refused to accept the honor of parade Grand Marshal, and has severed all formal ties and cooperation with Pride St. Louis, Inc. Longtime Pride Parade and PrideFest participants, the Ethical Society of St. Louis and the Metropolitan Community Church of Greater St. Louis, criticized the reversal and downsized their participation at those two events. In early August, the Board of another longtime Pride Parade participant, BandTogether St. Louis, met to reconsider future involvement with Pride St. Louis, Inc. and the Pride Parade.
On 8 July and 30 July 2019, the Board was loudly and angrily confronted by stakeholders during its regular Board meeting and an open Town Hall. At those meetings, Board members explained their decision to reverse was based on (unfounded) fears that parade/festival permits would be withdrawn by the City of St. Louis, forcing cancellation of the 2019 PrideFest and Pride Parade. Unable to honor corporate sponsorship and other contracts, Board members feared bankrupting Pride St. Louis, Inc. and/or personal liability for the organization’s contractual obligations.
Despite the incredibly bad timing of first presenting the issue of police in the parade in June (when Pride month activities give LGBTQIA+ organizations less capacity to respond), misjudging the gravity of the issue, not accurately predicting community opposition and support, and poor internal communication and lack of transparency, some Board members responded to calls for explanation with anger, personal attacks, and community blaming. Others presented themselves as ‘martyrs’ to the demands of the organization’s largest programs rather than Board members charged with determining the size and form of its events. The Board offered no formal acceptance of responsibility for its actions, acknowledgement of wrongdoing, apology for harm caused, or commitment to a plan to ensure prior mistakes are not repeated.
In response to several years of controversies that have damaged my community, I informed the Board at its 8 July Board meeting that, if I did not see immediate efforts to reform the organization, I would pursue all available avenues to compel it to comply with state and federal law, and non-profit best practices. I will not sit idly by while a poorly-run Pride St. Louis, Inc. continues to harm my community. This complaint is part of that effort.
In July, I submitted several detailed requests to inspect records Pride St. Louis, Inc. is legally mandated to keep and make available to the public (under Missouri law and its own by-laws). I suspected the causes of the problems described above were organizational mismanagement, poor communication, lack of transparency, lack of paid staff, and governance issues rooted in lack of Board development and absence of specific competencies among Board members. However, I did not expect to find evidence of Board negligence and malfeasance, financial mismanagement, willful ignorance of legal and fiduciary obligations, conflicts of interest, and failure to maintain and provide legally-mandated records. In multiple instances, over a several year period, the Board of Directors of Pride St. Louis, Inc. has violated its duties of care, loyalty, honesty, obedience, and oversight.
Specifics of the complaint
Non-compliance with mission
According to its website, the mission of Pride St. Louis, Inc. is, “To foster an understanding of and equality for the LGBT community in the general population by raising awareness through educational programs and events ultimately leading up to the annual PrideFest in St. Louis.” Elsewhere on that site the organization claims, “We exist because of the investment and inclusion of all members of our community. We are committed to listening to, serving, and representing your interests. We will continue our work: building bridges, encouraging inclusion and diversity, advancing equality, and promoting unity.”
It is clear from the background described above that Pride St. Louis, Inc. has not been fulfilling its mission, specifically “advancing equality” or “listening to, serving, and representing [the LGBTQIA+ community’s] interests.” The events of June 2019 did not “foster an understanding of and equality for the LGBT community in the general population.” Rather, the broader public has been left ill-informed about the organization’s work and motives for requesting armed/uniformed police not participate in the 2019 Pride Parade. Large segments of the St. Louis area population and parts of the LGBTQIA+ community have been alienated. Weeks of negative local and national media coverage will likely make it more difficult to advance LGBTQIA+ civil rights in Missouri. Rather than “promoting unity,” the organization’s actions of the past five years have sown division and distrust. “Bridges” within the community have been burnt, not “built.”
Regarding “inclusion and diversity,” the organization’s Board currently includes NO lesbians or bisexual women (and never more than two out of as many as 18 Board members in the last several years) — despite these two groups comprising more than half the LGBTQIA+ population. Only recently has there been more than token representation by African-Americans on the Board, despite the City of St. Louis being 50% Black and the wider area being 30% Black. The organization did not work to include “all members of [its] community” when its Board President and Director of Compliance spread a false rumor that federal law enforcement (“Homeland Security”) would be “handling security” at the 2019 Pride Parade, in an attempt to dissuade protesters from disrupting the parade. Nor was community “inclusion” advanced when the Board incorrectly informed 30 July 2019 Town Hall attendees that it was not possible to change the Board from “self-perpetuating” to “membership elected” without amending its Articles of Incorporation.
Many Board members do not respond to emails and efforts to contact the Board by other means (i.e. text messaging, social media) are ignored or rebuffed. There is evidence that the Board collectively agrees to not respond to community efforts to become involved with the organization, verify the occurrence of organizational meetings, or understand the activities of the Board. Despite the alienation of one of its core constituencies — the transgender community — several Board members have publicly described the 2019 Pride Parade as “wonderful” and the “best ever.” Refusing to respond to records requests, censoring social media comments/posts, and “embargoing” Board meeting minutes are not acts of “inclusion.”
As recent years’ budgets clearly show, the organization does not fund or produce much of any “educational programs.” More than 90% of the organization’s income and expenses are associated with two (of its three major) programs: PrideFest and the Pride Parade. Almost none of its $550K — $650K annual budget is devoted to organizational development (including board development), community education or programming, or providing community services not associated with PrideFest or the Pride Parade. Though the organization opened a community center in late 2016, that program has been woefully underfunded compared to other programs.
Financial mismanagement
Directors of non-profit organizations have a duty to manage the organization’s financial resources with honesty, integrity, transparency and accountability, and according to relevant law and generally accepted accounting principles. However, my records requests and discussions with former Board members have revealed serious financial mismanagement by the Board of Pride St. Louis, Inc., some of which rises to the level of malfeasance. Over the past several years, that mismanagement has wasted tens of thousands of dollars that could have been better spent fulfilling the organization’s mission.
•Financial controls
Despite hosting a major street festival involving a large number of small cash purchases and donations — $140K in food and alcohol sales; $17K in donations at 2018 PrideFest — Pride St. Louis, Inc. does not appear to have adequate (or any) internal or external financial controls to detect or prevent theft or embezzlement of money or other assets, such as alcohol. For years, rumors have circulated in the community that individuals are personally profiting from being involved in food and beverage sales at PrideFest. There is no evidence that (internal or external) financial audits of any kind are being performed or reported to the Board for its oversight, reflecting a kind of negligence that rises to malfeasance. Donors to non-profit organizations deserve to know that their donations are appropriately safe-guarded, accounted for, and used to further its mission. That’s not currently happening at Pride St. Louis, Inc.
•Scholarship funds
Every year, Pride St. Louis, Inc. claims to offer an unspecified number of academic scholarships in unspecified amounts. In FY2017 the organization expensed $24K in scholarships; in FY2018 the amount was $1800.00 (on $583K total income). The organization struggled to honor scholarship awards in FY2016, eventually borrowing money to honor awards, and there do not appear to be any scholarships awarded in FY2017. Board meeting minutes are silent on this matter, but it is rumored in the community that Pride St. Louis, Inc. did not fully honor its commitment to scholarship awardees in FY2018. Awardees reportedly had to confront the organization in person to receive their awards. Donors to non-profit organizations deserve to know their donations are being used to provide the promised services, with a full accounting of that use and explanations for any deviations from promises. That’s not currently happening at Pride St. Louis, Inc.
•Consolidated financial statements/annual reports
Despite numerous records requests, Pride St. Louis, Inc. failed to provide consolidated annual financial reports compiled according to generally accepted accounting principles (“appropriate accounting records” and “financial statements”), as required under Missouri law and its own by-laws. Moreover, the organization does not produce annual reports in which such financial information is typically found. What was provided were bi-annual “management statements” that were out-of-date, incomplete, and unaccompanied by statements of analysis and discussion or indications they had been produced and audited by a CPA or accounting firm. (They were all dated 30 July 2019, indicating they were produced in response to my requests, not during the financial periods they cover. There is also no indication in Board minutes that these “management reports” are being presented to the Board.) The failure to regularly produce consolidated annual financial reports and provide them to the entire Board makes it impossible for Board members to prudently manage the finances and direct the activities of the organization (and helps explain many of the problems described in this complaint). The lack of awareness demonstrated by several Board Officers and Directors in response to my requests for these records indicates a kind of “willful ignorance” about the organization’s financial condition that rises to the level of malfeasance.
•IRS reporting
Beginning 10 July 2019, I made several requests to inspect Pride St. Louis, Inc.’s IRS 990s forms filed after FY2015 (FY2010 — FY2015 990s are available on the organization’s website). Those requests were ignored until I threatened legal action. On 18 July, I was informed the Board could not find the forms. On 21 July the Board President informed me that filing extensions had been requested for FY2017 and FY2018 but that FY2016 would be sent by the Board Treasurer on 22 July (it was never received). On 1 August I received an email stating the Board believed a filing extension had been requested for FY2016, but it was unable to locate the paperwork. Guidestar, Charity Navigator, Nonprofit Explorer, and the Foundation Center, which all draw data directly from IRS databases, show Pride St. Louis, Inc. has not filed a FY2016 IRS 990 form.
The IRS allows a one-time, automatic 6-month extension for filing 990 forms. If filing extensions were requested, Pride St. Louis, Inc.’s FY2016 990 was due NO LATER than 15 November 2017. After that date, the organization incurred a penalty of $20 per day late. Similarly, its FY2017 990 was due NO LATER than 15 November 2018 (assuming an extension was filed) with similar penalties accruing. Moreover, the organization’s FY2015 990 Schedule B (“Schedule of Contributors”) did not provide the names of the organization’s top ten donors, making the filing incomplete, which also incurs daily penalties after 15 November 2016. By my calculation, Pride St. Louis, Inc. has exceeded the maximum penalty of $10,000 per unfiled report for FY2015 and FY2016, and will approach that fine if FY2017 90s is filed on 15 November 2019 (as the Board has claimed it will be).
In its defense, the Board points to changes in accounting software and turnover on the Board. In an email of 1 August, the Board informed me they were “pricing out” accounting firms to complete FY2016–2018 IRS 990 forms, but the forensic accounting required to complete two- and three-year old tax returns will dramatically increase the cost of these professional services. Untimely filing of its tax returns will cost Pride St. Louis, Inc. roughly $30K. These costs are the result of gross mismanagement of the organization’s financial resources and failure to comply with reporting obligations, which both represent malfeasance.
Moreover, in response to my several records requests, the Board President, Board Treasurer, and another (non-officer) Board member indicated they were ignorant of the organization’s current standing with the IRS — a clear violation of Board members’ obligations to understand the financial condition of the organization they direct. Finally, I do not believe most of the Board understands that if Pride St. Louis, Inc. does not file its three-years back tax returns by 15 November 2019, the IRS will automatically revoke the organization’s 501(c)(3) non-profit status.
•Annual deficits/carried debt
From annual budgets and available IRS 990s, it appears Pride St. Louis Inc. has been operating with an annual deficit for several years and carrying large amounts of debt over several years, yet not reducing major program costs. In fact, the size and costs of those programs increased over time even as debts mounted to alarming levels. In FY2016, that debt made it difficult to honor profit-sharing agreements with sister non-profits and for-profit vendors who sold food, beverages and other goods at 2016 PrideFest. It appears it also made it difficult to honor commits to scholarship awardees in FY 2016 and FY2018. In FY2016, the Board had to borrow money in order to meet its scholarship commitments.
Accounting irregularities make it difficult to accurately gauge the organization’s carried debt — sometimes debt is categorized as a PrideFest program expense, other times as a general expense, but not as part of total liabilities distinct from annual or program expenses. This is likely caused by the Board ceasing to use a CPA starting January 2017. In FY2011, the organization recorded $80K in debt; in FY2013, $43K in debt; in FY2014, $22K in debt; in FY2015, $34K in debt. I don’t have the organization’s budget for FY2016, but its FY2018 Approved Budget projected FY2014 — FY2016 carried debt of $161K. The FY2019 Approved Budget indicates actual carried debt from FY2014 — FY2018 of $247K. In other words, by the end of FY2018 the organization’s carried debt amounted to 45% of that year’s $550K income.
In response to this situation, in Spring 2017 the Board proposed a $5.00 entry fee for the event, then reversed itself. On 7 July 2017, the organization posted a “financial update” to its website stating that income from 2017 PrideFest had retired $160K in carried debt. However, its FY2018 Approved Budget indicates the organization paid $200K in debt in FY2017. (In other words, the organization entered FY2017 with significant accumulated debt, increased its program budget, attempted to raise funds to retire that debt, reported to the community that the debt had been retired, but exited the fiscal year with an additional $40K in debt.) Similarly, per the FY2019 Approved Budget, the organization projected FY2018 debt of $121K but actually incurred $133K in debt. Board minutes indicate the organization entered FY2019 with $30K in debt so the actual FY2019 debt is likely to be more, especially given the accounting/filing fees described above.
Bear in mind, the organization owns no real estate or other substantial assets with loans that would explain carrying long term debt. The annual deficits and carried debt are the result of resistance to reducing program expenses, specifically the costs of the annual PrideFest and Pride Parade. During some of these years, the actual expenses of producing the organization’s largest program — PrideFest and the Pride Parade — increased even as the organization accrued more debt. In FY2016, PrideFest/Parade expenses were $309K but in FY2017, they increased to $541K — the same year the Board attempted to charge an entrance fee, appealed to the community for a bailout, and incurred further debt. (The projected cost of 2017 PrideFest was $474K.) In FY2016, the Board voted to initiate a new program — PrideCenter — despite carrying over significant debt and having no plans to fund the program. In FY2017, it voted to increase the “entertainment” budget of PrideFest despite just having imposed an entry fee to address carried debt of $161K. The actions are simply irresponsible.
The amount of interest and late fees associated with nearly $300K in debt accrued over the last decade is unknown, but surely that money would be better spent on the organization’s mission. This failure to reduce program expenses in response to years of deficits and increasing carried debt reflects mismanagement of the organization’s programs and finances by the Board.
•Ratio of program to administrative expenses
Symptomatic of financial mismanagement at Pride St Louis, Inc. is the amount the Board spends on (some) of its programs compared to administrative/fundraising costs. A common measure of non-profit organization effectiveness is the ratio of program to administrative/fundraising expenses. A non-profit is considered inefficient if it spends too much income on administration/fundraising and not enough on service delivery. Pride St. Louis, Inc. has the opposite problem: too much of its income is spent on (some) programs and not enough on the kinds of administrative expenses typical of a well-run non-profit. Embedded in this imbalance of priorities is evidence of misappropriation of funds amounting to malfeasance by the Board.
The organization has three main programs: PrideFest, the Pride Parade, and PrideCenter, a small community center opened in late 2016. In both FY2017 and FY2018, 84% — 87% of total organizational income was spent on PrideFest and the Pride Parade, while less than 1% of income was spent on PrideCenter. In fact, donations earmarked for PrideCenter appear to be used to fund other organizational activities and fixed expenses. In FY2016, the Board only spent $79.42 on PrideCenter expenses. In FY2017, PrideCenter received $16,000 in donations but only $2782.89 was spent on its activities. (The Board budgeted $3100.00). In FY2018, the Center received donations of $8720.00 but only $661.34 was spent on activities. (The Board budgeted $13,000). There is mention (in records provided) of PrideCenter receiving grants but no evidence that grant money is spent on PrideCenter activities. From budgets provided, it appears the Board is using donations earmarked for PrideCenter to ‘plug’ other financial ‘holes’ in the organization’s budget, such as fixed expenses (i.e. rent, utilities, etc.), annual deficits, and carried debt. That makes the organization vulnerable to donor lawsuits for misappropriation of restricted funds.
Further, because the Board has allowed PrideFest and the Pride Parade to become outsized foci of income and expenses, when community conflicts arise regarding these two events — as in 2015, 2017, and 2019 — the Board has been forced to choose between mollifying corporate sponsors/local politicians/police or keeping faith with its community. If it chooses the latter, the Board risks bankrupting the organization because, without the income derived from an outsized PrideFest and the Pride Parade, there would not be any Pride St. Louis, Inc. When this vulnerability has been pointed out, the Board represents itself as hostage to the demands of its two major programs rather than possessing the power to reign in the size and expense of these programs or pursue alternative forms of funding. And by not commissioning studies of the total economic impact of PrideFest and the Pride Parade, the Board is less well-armed to resist external pressures.
By not controlling the relative size of, and limiting its dependence on, its two largest programs, the Board has allowed PrideFest and the Pride Parade to jeopardize the very existence of Pride St. Louis, Inc. That mismanagement has left few resources for its third program, PrideCenter, much less other, legitimate administrative expenses, such as Board development, paid staff, professional services, and improved physical infrastructure (i.e. furniture, equipment and facilities). Those resources would have been invaluable to help prevent or aid the navigation of the controversies of the past five years.
Records requests
Between July 10 and July 27, 2019, I made several requests to inspect specific organizational records that Pride St. Louis, Inc. is required by Missouri law to maintain and make available for inspection (see attachment). The final request was framed in terms of Missouri Sunshine Law (on the advice of your office). None of the records were provided within the mandatory inspection period and some have never been provided, most importantly some minutes of meetings of the Board of Directors (complete with reports and attachments discussed at meetings) and some Committees of the Board, some annual budgets, and complete consolidated annual financial statements. Although provided records claim that “notes” are taken at Board Committee meetings, the Board refused to provide these “notes” because they do not call them “minutes.” However, in some records provided, Board committee minutes are referred to as just that: “minutes.”
As described elsewhere in this complaint, records of discussions/votes by the Board on official organizational business that occur outside Board meetings were requested but not provided (even though the Board acknowledges such discussions/votes are occurring). Although the Board maintains that any discussions/votes that occur in this group are recorded at the following meeting’s minutes, the provided minutes do not substantiate this claim. This is a direct violation of the organization’s by-laws. The Board cannot provide a consistent explanation for why its FY2016 IRS 990 form was not provided in response to several requests. Emailed responses indicate the mandatory records are not being kept at the organization’s principal offices and not in a form that is easily retrievable by the Board members delegated with responding to requests (no Custodian of Records is indicated on the organization’s website).
Conduct of the board
In several areas, the conduct of the Board violates state law and its own by-laws. These issues are all the more concerning in light of the organization’s delivery and hosting of a range of new direct social services through PrideCenter, which does not have a staff or director, and is not properly funded by the Board. Its existence raises a host of new governance, policy, financial, and liability issues that were not addressed before it was opened in September 2016.
•Board transparency
Although the organization’s Event calendar states, and several current and former board members argue, that Board meetings are “open to the public,” only some Board meetings are announced on the organization’s internet event calendar and not all meetings are open to the public (even when the Board is not in closed/executive session). Unannounced Board meetings occurred on 1 June 2019 and 8 July 2019, and the meeting of 1 June was not open to the public.
Meeting agendas are never provided to the public in advance of Board meetings and, at some meetings, no minutes are being taken. Despite there being no provision for such meetings in the by-laws, official business of the Board, including voting on Board business (“polls”), is being conducted via a private Facebook group, of which only the Board are members. Minutes of discussions/actions occurring in this group are not being kept, nor are they recorded in minutes of subsequent Board meetings, as specifically required under the by-laws.
Senior Board members, often on its Executive Committee, repeatedly instruct other members to “stay in their lanes” rather than encouraging oversight responsibility for the entire organization, including its finances. One Board member indicated (in response to a records request) that he needed “permission” of other Board members to access and share records the organization is legally mandated to keep and make available for public inspection.
Perhaps the most egregious violation of legally-mandated Board transparency occurred in Spring 2017 when the Board voted to “embargo” March and April 2017 Board meeting minutes and minutes of the April meeting of the Festival Committee of the Board until 1 May 2017. Seemingly, this action was taken to hide the fact that the organization was deeply in debt and planned to charge an entry fee for 2017 PrideFest. The action was initiated by the Director of Compliance, the Board member charged with ensuring the Board complied with relevant laws and its own by-laws (which do not allow for “embargoing” minutes of open Board meetings). At the 10 April 2017 Board meeting, one Board member justified the “embargo” by complaining about “leaked” minutes despite the fact that Board minutes are public by Missouri law. At the 24 April 2017 Board meeting, draft March and April Board meeting minutes were distributed on paper, approved by the Board, then collected and destroyed by the Board Secretary. The Board members were so unaware of their legal and fiduciary obligations to conduct business transparently that they recorded their collective malfeasance in the very minutes they “embargoed.” A non-profit Board is not being transparent or accountable to stakeholders when it attempts to improperly hide public records that reveal the poor state of its finances and controversial plans to address it.
•Conflicts of interest
There are several current and former Board members who own co-own, or are employed by businesses — event/convention planning, entertainment, hospitality, corporate diversity training — having direct conflicts of interest with the programs of Pride St. Louis, Inc.
In September 2017, the Board voted to appoint two of its members to compensated positions with the organization to coordinate a U.S. State Department grant those Board members had obtained for Pride St. Louis, Inc. as part of their service on the Board. The two Board members, along with a third selected later, became partial beneficiaries of a $90K grant, which included travel expenses for a cultural exchange program with Russia. No open application process, interviews, or competitions were held to select grant beneficiaries from the population served by the organization.
•Other board conduct concerns
Board members are known to engage on social media in contentious debate with, and personal attacks on, community members calling for transparency and accountability. Alcohol use by Board members at organization functions appears to be a constant issue, and some Board members are reported as being inebriated during Board meetings and organization programs/activities. Former Board members report that organizational funds are used to purchase alcohol for Board members when meetings or activities are held in local bars. The organization’s by-laws do not contain a Code of Ethics that might guide Board members in navigating these issues.
The major programs of Pride St. Louis, Inc. are central to LGBTQIA+ visibility and public life in St. Louis and the surrounding area. They have a large economic impact on the City of St. Louis and draw attendance from an hour or more away. For many young LGBTQIA+ people, a pride event may be their first or only opportunity to experience a large number of peers living open, authentic lives. Similarly, our community desperately needs a space where groups can meet, and individuals can find community, education, and enrichment. PrideFest and the annual Pride Parade have long served these purposes for St. Louis, and PrideCenter has the potential to fill a gap in local social services. But these programs need to be delivered in a way that does not further harm an already marginalized and stigmatized community.
That can only happen if the Board of Directors of Pride St. Louis, Inc. begins to take its responsibilities seriously, and comply with state and federal law, its own by-laws, and non-profit best practices. I’m hopeful this complaint will be the beginning of that process.
Sincerely,
[signature redacted]
Michael J. Murphy, MA, PhD
Associate Professor of Gender and Sexuality Studies
Local contact information:
[redacted for privacy]
cc: Board of Directors, Pride St. Louis, Inc.
Michael J. Murphy, PhD, is Associate Professor of Gender & Sexuality Studies at the University of Illinois Springfield. He is the author of many book chapters, and encyclopedia and journal articles. Most recently, he edited Living Out Loud: An Introduction to LGBTQ History, Society, and Culture (New York: Routledge, 2019). He tweets @emjaymurphee.
