Troubled S.F. Parks Alliance will shut down amid city investigations into financial mismanagement

The San Francisco Parks Alliance, a prominent nonprofit that helps improve the city’s public spaces, is preparing to dissolve after misspending millions of dollars and falling out of favor with city officials, donors and community partners.

Board members of the nonprofit voted last week to wind the organization down, a person familiar with the matter said Monday. The Chronicle agreed not to identify the person because they were not authorized to publicly discuss the situation.

Robert Ogilvie, who the Parks Alliance hired as its CEO three months ago, confirmed the impending closure Tuesday. 

The Parks Alliance has long played an important role in San Francisco’s beloved park system by steering private dollars to open-space projects and functioning like a bank for about 80 neighborhood park groups. Those groups pay a fee for the nonprofit to collect money on their behalf so they don’t have to obtain nonprofit status themselves or hire their own bookkeeping staff.

But some of those community partners this year began publicly voicing concerns about the Parks Alliance’s financial condition after the organization took months to reimburse them for expenses as little as $100. In an email obtained by the Chronicle in May, the chair of the Parks Alliance acknowledged that the nonprofit had spent at least $3.8 million in restricted funds on its operating costs.

In an email to Parks Alliance partners, Ogilvie said he had tried to stabilize the nonprofit through fundraising, but did not succeed.

“This decision is extremely upsetting to me but is unavoidable given the state of the finances of the organization,” Ogilvie wrote. “To all those who believed in our mission—our community partners, funders, public agency collaborators, and above all, the residents we served — I want to say thank you. I think you all deserved much better.”

The nonprofit’s board, which was chaired by Louise Mozingo, also released a statement announcing the closure with “deep regret.”

“We are truly sorry we have arrived at this moment,” the statement read.

The Parks Alliance’s board has hired Jigsaw Advisors, a firm that specializes in restructuring companies and bankruptcies, to wind down its operations through a process for liquidating its assets known as an “assignment for the benefit of creditors,” according to Ogilvie and the board.

The process is an alternative to filing for bankruptcy.

The Parks Alliance has terminated all of its employees and all of its board members have resigned as part of the shutdown, Bill Brinkman, partner at Jigsaw Advisors, wrote in an email to a city supervisor Tuesday.

“We do not know what transpired at SFPA as our work just commenced,” Brinkman wrote. “It will take time for the assignee ABC team to work through its process and to understand SFPA’s books and records.”

Brinkman asked for patience as his firm works “cooperatively and responsively” with various investigative entities.

The Parks Alliance is the latest San Francisco nonprofit with ties to City Hall to collapse amid reports of mismanagement that attracted the attention of city prosecutors. Last year, the nonprofit SF SAFE ceased operations and its former executive director was arrested after allegedly misusing more than $700,000 in public funds and donations.

While the Parks Alliance had replaced its top executives and was looking to obtain new funding to steady its operations Mozingo, acknowledged in the May email that the nonprofit may be left with no choice but to close down. Mozingo likened the organization’s financial situation to “a dumpster fire.”

In that email, sent to a Parks Alliance donor, Mozingo said the board had prepared to possibly shut the nonprofit down by “contacting a highly recommended and experienced firm which specializes in non-profit liquidation,” noting that the firm had a $100,000 fee. 

Mozingo also said the board was “very conscious” that liquidating the nonprofit would “substantially hurt many small businesses and organizations that will realize a significant loss, causing real hardship in already uncertain times.” 

The disarray and misspending at the Parks Alliance prompted a criminal investigation from the district attorney and a separate probe from the city attorney that could lead to a lawsuit or the nonprofit being banned from getting city money. Mayor Daniel Lurie has already halted public funding from going to the nonprofit until its finances are audited by the city attorney and controller.

Additionally, Supervisor Shamann Walton has called for a hearing on the Parks Alliance’s financial mismanagement that is scheduled for Thursday. Supervisor Jackie Fielder has called for an audit of the San Francisco Recreation and Park Department and its connections to the Parks Alliance. 

About 20 of the community groups that rely on the Parks Alliance to manage their books came together in a last-ditch effort to save the nonprofit, but its financial challenges proved insurmountable. Now, those same groups are left wondering what will become of the money they raised and the parks they’re trying to beautify.

“The way this has happened is incredibly detrimental to our work,” said Ildiko Polony, co-chair of the Community Partner Network Advisory Committee that tried to save the Parks Alliance. “There was no transition plan. There was very little communication.”

Polony is the director of Sutro Stewards, which has relied on the Parks Alliance as a fiscal sponsor and had about $175,000 in fundraising banked with the nonprofit. She said she hopes the city sets up a successor organization to the Parks Alliance and finds a way to make groups like Sutro Stewards whole.

“The city has an opportunity to show real leadership and create a plan and a structure … to make sure that the crucial function that SFPA provided for us does not just evaporate,” Polony said. 

Rasheq Zarif, who co-chairs the community partner committee with Polony, said he hopes San Francisco “brings forth a more reliable organization for us to work with.” But he also stressed that the former executives and board members of the Parks Alliance should be “held accountable” to make community groups whole. Zarif leads the Buena Vista Neighborhood Association, which should have about $100,000 in fundraising held by the Parks Alliance. 

“The board of trustees and former executive officers had a fiduciary duty to ensure that our restricted funds were not used beyond the scope of our projects,” Zarif said. “The fact that it has been not only used, but depleted, shows gross negligence on their part. They should be held personally responsible for the losses that we’re all experiencing.”