River Region Human Development Inc.

The River Region Human Development nonprofit is housed in this small office building in Gonzales, as seen Monday, Sept. 10, 2019. The state Legislative Auditor’s office halted grant funding for the nonprofit earlier this year because the agency was late in submitting its annual audit.

GONZALES — A 31-year-old nonprofit based in Ascension Parish that provides more than a $1 million annually to feed children in need had its state funding stopped for about four months this year due to a late annual audit, a state official has confirmed. 

River Region Human Development Inc., which is based in a small office in Gonzales, received more than $1.3 million last year in a federal grant through the state Department of Education for a nutritional program helping hundreds of children in Ascension, Assumption, St. James and St. John the Baptist parishes.

Edgar Irvin, director of the program, said the suspension between April and July did not interrupt services to the program's recipients and grant dollars resumed to the organization on Aug. 1. He said the program remains in good financial shape and isn't going anywhere.

"I can give you my word on that," he said in an interview Monday. 

Assistant Legislative Auditor Bradley Cryer, director of the Local Government Audit Services office, said the state Auditor's Office withheld the grant money because the nonprofit hadn't turned in its annual audit by the end of March. 

Cryer said the agency can withhold state dollars if an annual audit isn't submitted within six months of the end of the agency's fiscal year, which was Sept. 30. 

Once submitted at the end of July, the newly publicized annual audit for 2018 showed Irvin's nonprofit agency ended the fiscal year with a cash deficit of nearly $18,000.

The agency was also cited for not paying payroll taxes and had to pay back $2,662 in reimbursements given to one program participant because of a compliance error, auditors found.

River Region Human Development's auditors wrote that the suspended grant money and the negative financial position on Sept. 30 raised questions that the nonprofit could continue to be a "going concern."

But the auditors added this "substantial doubt" was alleviated once management had decided to cut administrative expenses by 10%, agreed to seek a $12,000 donation for administrative expenses, and would see the federal grant money become available again once the annual audit was submitted. 

As a nonprofit, Irvin said, the organization doesn't typically turn a profit but exhausts its funds annually so the audit's year-end statements aren't necessarily unusual. 

In 2018, the nonprofit spent $1.08 million on aid to program participants and another $261,660 on salaries for Irvin, who is paid about $83,000 a year, and other employees and on office and other administrative expenses, or about 20% of total revenues.

The nonprofit has a handful of employees, including Irvin, and runs a Family Day Care Home Program, which falls under the U.S. Department of Agriculture's Child and Adult Care Food Program.

Since 2010, the nonprofit has garnered about $10.3 million in revenues, almost entirely in federal grant money, according to annual audits and nonprofit IRS documents. 

Irvin said the program provides cash reimbursements to about 200 providers throughout the region for feeding needy children with a USDA-approved menu of foods.

Despite the name of the program, Irvin said, the program providers are not day care centers but grandmothers, aunts, neighbors and others who care in their homes for the children of adults who are working or seeking education. 

He said participants don't have to provide receipts for reimbursement but are subject to regular checkups to ensure they are providing food tied to the approved menu. The agency spent only $627  last year on travel for that monitoring, the audit says.

Irvin said the unpaid payroll taxes — $3,788 for the second quarter of 2018 — have since been paid.

He added that the another compliance finding involved the lack of a key form that one provider had not signed.

He blamed the late audit on a switch of auditing firms that set back the work. 

According to the 2018 audit, however, the nonprofit's audit from 2017 was also late.

Email David J. Mitchell at dmitchell@theadvocate.com

Follow David J. Mitchell on Twitter, @NewsieDave.