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Sunday, November 16, 2008

No Free Lunch: Protecting Women and Children Costs Money

cross-posted at RealMadison.org!

"You cannot put a value on what she's done. We couldn't afford to pay her for all the time she's invested. She's one of a kind." —Craig Johannsen, discussing Teri McCracken's work as executive director of Madison's House of Hope domestic abuse shelter, in Elisa Sand, "House of Hope Closes After 23 Years," Madison Daily Leader, 2008.08.28.

Johannsen was half right: They evidently couldn't afford to pay McCracken any longer, although they did put a value on her work: $67,167.80.

According to the Madison House of Hope's 990 non-profit tax filing, that was the salary paid to the House of Hope's full-time executive director in 2006. Page 1, lines 10–17 of that 2006 990, offers a breakdown of how much it costs to run a domestic abuse shelter in Lake County:

Category Amount
Grants and similar amounts paid


Benefits paid to or for members --
Salaries, other compensation, and employee benefits 77,891
Professional fees and other payments to independent contractors 2,000
Occupancy, rent, utilities, and maintenance 3,577
Printing, publications, postage, and shipping 1,011
Other expenses 12,248

Total expenses


That's a lot of money, but a domestic abuse shelter is also an important service. The House of Hope made an abrupt and seemingly unhelpful departure, ceasing its pursuit of grant support two years ago, spending down its reserves, selling its house, and announcing its closure so suddenly that there was hardly time for organziers to mount an effort to save the program.

Let's hope the new Domestic Violence Network can pick up where House of Hope left off, reconnect with those grant funding sources, and restore these services for the families that need them.


  1. The closing looks as if it was a well thought plan of action rather than an abrupt shutting of the doors.

    Madison residents will have to suffer the consequences of the House of Hope's board inaction. We might look back in a few years as the closing being a good thing because a better solution to domestic violence arose. Of course that might be hard to explain right now to a victim needing services today.

  2. Maybe House of Hope could locate in the former Garfield School Building or former Lincoln School Building. There must still be rooms available in those facilities, and perhaps more affordable.

  3. Anybody who knows anything about dv services in this state - or the non-profit sector in general - can see that something isn't right here. MkCracken was overpaid by the most generous of standards, but even more so when you consider that she really hasn't been providing effective services for years.

    The closing of the House of Hope was the conclusion of a calculated, 2-year plan to essentially squander all of the agency's resources and fade away, all because McKracken was apparently uncomfortable with the questions she was being asked by their main grantors (a.k.a.: the State of South Dakota).

    Fortunately, McKracken and Craig Johansen, the Board Chairman, were so careless and arrogant in their activities that people started to see that something just wasn't right. We're now learning that there was a whole lot not right with this situation. Hopefully Rounds's and/or Long's offices are looking into this.

    As for Johansen...well, one cannot help but think his careless and ridiculous statements about this situation caused some voters to think twice about re-electing him. Enjoy life as a private citizen, Craig. You'll have plenty of time now to ponder on where you went wrong.

  4. Also consider:

    - The tax office still shows the shelter as the owner although Johanssen said it was sold with proceeds used as operating expenses (and payments to new landlord?). Hmmm.

    - What about those obligations of the other board members? In 2005-06 only 3 are listed on the 990. In 2004: Craig Johannsen, Joan Krantz, Gary Comes, Chris Giles, Alexander Davidson, Cheryle Eichmann. Did they bail? Did they fail to speak up about known problems?

    - Personally I think the 990s should hang on the wall at the court house, although the stuff can be had for free off the internet or you can ask for a copy.

    John Hess

  5. Oh, I forgot Wanda Paul who was the Fiscal Officer in 03.

    We should ask these board members their take on what was going there. jh

  6. There is a new group in Madison that is working on getting another safe house opened in Madison!

  7. There's a wonderful list of names working on the new shelter. If our community has this need, how can we not be supportive, but is Craig Johanssen still involved? The Leader article made it seem that way from his statement it was not recommended to transfer the old 501c3 to the new organization. If he remains as a board member, from what we have learned, it does not give confidence.

  8. Craig Johansen is NOT involved in the new organization. NOBODY connected with the HOH is connected with the new Family Violence Network. They are comprised of a group of concerned individuals who are doing all of this on their own time. They are to be commended.

    Unfortunately, Johansen saw to it that they have to re-invent the wheel: instead of stepping aside and simply transferring the 501(c)3status to them, Johansen felt the need to consult an attorney (which in itself is curious) who advised him not to hand over the non-profit status. Also curiously enough, Johansen and McKracken have not been willing to turn over any financial records to the new group.

    For anyone who doesn't know, founding a non-profit and establishing a 501(c)3 can be a long, expensive, and arduous process. It's much, MUCH easier to just transfer it, which simply takes a few signatures and a filing with the State of SD.

    So why the secrecy? In my experience, people who have nothing to hide don't hide anything.

  9. And let's not forget...Craig's wife was also on the payroll...and isn't he related somehow to Wanda?

  10. They actually can't hide the information from you. It's the law, and you can find and print out the regs on the IRS site that the 990 is Open for Public Inspection. They must on demand give you a copy and are only able to charge you $1.00 for the first page and 15 cents for each remaining page. You can get quite a bit of it on the Guidestar or FoundationCenter web sites, but not the 2007 year yet, so you would have to ask the organization for that directly. They can't turn you down. jh

  11. Anon 3:00 pm: You're certainly right about the 990 being public knowledge. Obtaining that has never been the problem. But the 990 is essentially just a summary of expense categories. The REAL story of how their money was spent would be in their detailed books (bank statements, cancelled checks, expense vouchers, purchase orders, etc.). Those documents are not available for public inspection, unless you know something I don't. And if you do, please share, because there are a number of people who would love to see the details.

  12. Hey, Anons -- when you start talking about people's wives, it's time to put your name to what you're saying. (Actually, good neighbors and conscientious citizens use their names from the start.) If you've got facts, you have nothing to fear from stating those facts. John and I are willing to put our names to what we're saying; the rest of you, feel free to join us in putting your names to your words.

  13. Peej: I can't tell you more than you know. I did look back at the salaries on the 990 starting in 02 and although they look high, there may have been another employee. My major concern since I first became aware of this was the appearance that after all these years of support, the shelter house itself is not being given to the next organization. It never came on the public market and the tax transfer is not on record. Who is the "new" owner. That seems like a legal issue the new group should pursue. No?

  14. Can't somebody request or force an audit of their books so you can get the details? Ken Meyers must know. The house is worth about $55,000 to $65,000 is my guess. The new organization shouldn't too easily give up on resources that should be theirs, if they are entitled. Probably we all know sometimes it's just not worth it. Could they get a governor house? Seriously. Nice, new and efficient: low maintenance for years. Or work with Habit for Humanity on a new house. Put the word out on what's needed and somebody might donate a building lot. jh

  15. caheidelberger: while your point about anonymity is well-taken, I don't think it's out of line to bring up a wife if that wife is an employee of the agency we're discussing.

  16. Whenever you have two competing victim rights advocates they usually can't stand one another. Wait til the new group is up and running and then see how agreeable you find their operations. You critics of Johannsen and McCracken sound like an angry mob, and you're admittedly uninformed. They did a lot of good for a long time. Most 501(c)3's when winding down are required to donate remaining assets to charity, after paying debts and obligations. Doesn't mean they have to give the new group the property. Could have been their obligations prevented them from doing that. Nothing wrong with that, but it won't stop you from gathering up your pitchforks and torches.

  17. JH-Call the governor's office. If funding comes from them, they might be interested in all of this.

  18. ANON 4:22
    Give me a break. Any non-profit agency that recieves government funding should be willing to let anybody examine their bookkeeping. This entire thing has been fishy for at least a few years. This isn't about a witch hunt. This is about the HOH squandering funding that was meant to go to victims. If Johansen and McKracken were putting victims first, they would have jumped at the chance to pass the agency on to someone else, and been happy to do so. This keeping everything so close to the vest is about C-Y-A, pure and simple.

  19. 4:32 - again, you're uninformed. For it not being a witchhunt you sure jump to alot of conclusions.

    When did the new group form? It's possible the handwriting was on the wall long before then. Why are so many personally vested in this anger with HOH? Again it is because competing advocacy groups hate each other, even if what should be their unifying cause is a noble one.

  20. Anon 4:32:
    "competing advocacy groups hate each other, even if what should be their unifying cause is a noble one."

    2 questions:

    1. What are you basing this theory on?
    2. Do you work in the non-profit arena?

  21. This group formed only after the story about HOH closing ran in the paper. There's not hate here. People just want answers.

    Let me amend that: TAXPAYERS just want answers.

  22. Anon 4:32

    Why do you assume anybody who is asking questions is motivated by hate? I don't belong to an advocacy group, or work in non-profits. I don't know McKracken, Johanson, or anybody from this new group. I don't even live in Madison. But I do pay taxes in this state, and I think that alone entitles me to expect some accountability for how this money was spent by these people. Why is that hateful?

  23. I wonder how many people were served by the HOH w/in the last couple of years. I'm guessing not enough to justify at $65,000+ salary for McCracken.

    What about the house itself? What is the Madison Area Helpline doing with that?


  25. MDL reported this week that the building has been sold; Insurance and Real Estate Market now has it, if I recall correctly (but doublecheck, as I don't have the paper in front of me).

  26. Okay. Wait a minute. An August 28, 2008 article in the Madison Daily Leader stated (and this is a copy-and-paste quote):

    "Johannsen said the shelter has already been sold, and the new owner agreed to allow House of Hope to continue using the building until funds were depleted. Proceeds from the sale of the building were reinvested in the operation of the shelter and funds run out at the end of the August."


    How could the shelter have been sold earlier this year and the proceeds spent, as Johansen reported, then sold again to the Insurance and Real Estate Market just this week?

    I want to live in Johansen's world, where phantom transactions take place and those involved can squander funds, conceal their activities, and in the process run a much-needed agency into the ground apparently without fear of consequences.

    You would have to be HEADLESS not to see there's something wrong with this entire situation, going back 2-3 years!

    Craig? Teri? Deb Bowman? Larry Long? ANYBODY???

  27. So where does the money from the sale go??????


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