The Baltimore Children and Youth Fund has spent about $75 million in taxpayer money since 2020 with few controls or supervision from the finance department, mayor’s office, City Council or auditor, Inspector General Isabel Mercedes Cumming said in a report issued yesterday.

Approved by voters in 2016 after the unrest following Freddie Gray’s fatal injury in police custody, BCYF automatically receives 3 cents on every $100 of assessed property value, with the mission of supporting city youth opportunities by providing support to grassroots leaders and community organizations.  

Those funds, according to Cumming, currently amount to $16 million a year, with few checks or balances on how it is spent.

The city Department of Audits hasn’t audited the fund since 2019 when it got caught up in the “Healthy Holly” children’s book scandal through Associated Black Charities, then its fiscal sponsor.

BCYF has since become an independent nonprofit able to identify its own projects and develop a grant-making and capacity-building process with its own staff and governing board.

No financial statements were turned in for fiscal years 2022, 2023 or 2024 – neither the comptroller’s office nor the City Council demanded them.

A July 1, 2020 Department of Finance memorandum set up rules and regulations governing the disposition of money, including the requirement of an independent audit of grantees awarded $750,000 or more.

Those rules have not been followed by the Scott administration, IG report found.

In the last two years, for example, the fund invoiced over $26 million without divulging the names of grantees, as required by the Finance Department memorandum. It distributed another $21 million with a minimalist summary of revenue and expense totals.

Nevertheless, “the city paid out the money,” Cumming said in an interview yesterday.

What’s more, auditors at the comptroller’s office did not get financial statements from the organization for three years – FY 2022, 2023 and 2024.

But neither the comptroller’s office nor the City Council, which is required by law to hold a yearly BCYF oversight hearing, demanded the information, Cumming noted.

Finally, when it receives quarterly invoices from BCYF, the city budget bureau simply uploads the  invoices into the Workday payment system, then draws down the money from the fund’s property tax reserves.

“If the budget analyst team were charged with an oversight role in reviewing those invoices in greater detail, they would require additional information to validate those items,” Cumming wrote. “However, this has not traditionally been the role of the budget analyst team with quasi [government] entities.”

High Staffing Costs

The net result is that little is really known about how BCYF spends the millions it receives.

As a 501(c)(3) nonprofit, BCYF files unaudited statements to the Internal Revenue Service. The latest disclosure, for fiscal 2024, shows that it received $14.6 million in property tax funds and spent $9 million (62%) on grants, $2.7 million on staff salaries (19%) and $2.5 million (17%) on other expenses, including travel and consultants.

Worried that staff overspending would reduce the funds going to youth programming, the 2020 Finance Department memorandum called on the fund’s “fiscal agent” (now BCYF itself) to allocate no more than 15% for staff and administrative costs.

BCYF’s latest 990 report says it spent 36% – or over double the 15% limit – on non-programming costs.

Cumming does not cite the IRS reports and instead concentrates on the organization’s lack of disclosure of the organizations, subcontractors and consultants it has been funding.

“Of the 10 BCYF invoices recorded in Workday between January 2023 and September 2025, only three included lists of grantees,” she wrote.

“The most recent five invoices included a Statement of Activity (SOA). The SOA is an unaudited one-page summary of revenue and expense totals for the year-to-date period. None of the invoices appeared to include lists of BCYF’s subcontractors, and none included any third-party supporting documents (receipts, invoices, etc.).”

Cumming says BCYF should be required to provide “detailed supporting documentation” when it requests taxpayer funds and should undergo the same performance audits required for city agencies.

“I would want an audit every two years, or even every year, because of the amount of money we’re talking about,” she said.

A bill introduced by Councilman Mark Parker and six other Council members would require BCYF to undergo a performance audit every three years, beginning in fiscal 2027.

“Committed to transparency”

In response to yesterday’s report, BCYF President Alysia Lee said that “BCYF remains steadfast in its commitment to transparency, accountability and collaboration with city oversight bodies.”

Acknowledging that the city had not received the fund’s FY 22, 23, 24 financial reports, she said those records – as well as a FY24 financial statement – would be submitted shortly. Most of the material, she said, is already posted on the BCYF website.

Lee did not address the central issue raised by Cumming – the listing of specific grantees and subcontractors awarded public money.

Instead, she wrote that “BCYF maintains a comprehensive Internal Compliance Calendar and detailed Standard Operating Procedures (SOPs) that assign responsibilities, establish timelines and define confirmation requirements for all city submissions.” She said SB & Company, an Owings Mills public audit firm, reviews internal controls and conducts periodic SOP reviews.

The mayor’s office, which recently got a $7 million grant from the fund, is backing BCYF’s leadership.

In a separate statement, City Administrator Faith Leach praised current management, saying that “under Director Lee’s leadership, BCYF has made significant strides to improve transparency.”

This year BCYF sent $7 million to the Mayor’s Office of Employment Development, a transfer that has drawn criticism because the fund is meant to help community-based organizations, not government programs.

According to Leach, the “Department of Finance (DOF) actively works with BCYF to review their quarterly invoice submissions and the summary list of expenditures submitted with their quarterly invoice submissions. Additionally, DOF and the Comptroller’s Office have been working with BCYF since February 2025 to update the rules and regulations that govern BCYF’s financial submissions to the city.

“As a next step,” Leach continued, “the MO [Mayor’s Office] will work with DOF, the Comptroller’s Office and BCYF to finalize an updated set of rules and regulations on or before March 13, 2026.”