Star Tribune | Board members breached their duty to properly manage the nonprofit’s community center, the Attorney General’s Office said.
A St. Paul nonprofit violated state law by allowing its community center — its main asset — to fall into disrepair, according to the Minnesota Attorney General’s Office.
Attorney General Keith Ellison, whose office regulates nonprofits, announced this week that the Minnesota Cameroon Community had agreed to improve its policies and oversight. Michael Fondungallah, the organization’s attorney, said the small all-volunteer nonprofit has since hired an accountant and is working with reputable nonprofit experts.
“They have not done things by the book, but there was no fraudulent activity,” Fondungallah said of the Cameroon Community, which started in 2008 as a resource for immigrants. “The community wants to move on. They will correct those things.”
In a settlement filed in Ramsey County District Court, regulators say the nonprofit’s board members breached their fiduciary duty to properly manage and insure the Cameroon Community Center in St. Paul’s Energy Park district. The board didn’t pay property taxes, register the nonprofit with the state or keep proper records.
Under the settlement, the Cameroon Community agreed to establish proper board governance and policies, register with the state and provide quarterly updates.
The organization raised funds in 2014 to buy the community center for $200,000 and then raised more than $60,000 from donors in 2020 for the center and to pay off its tax debt. But the nonprofit returned only about $45,000 to Ramsey County on its debt, and it couldn’t account for how the rest of the donations were used, according to state officials.
It also failed to make necessary repairs to a boiler system, leaving the community center building unheated during the winter and causing it to flood last year when water mains burst.
Fondungallah said the organization used the donations to pay utility bills and operate out of its aging building. Because the nonprofit only uses a small part of the building and can’t afford an estimated $500,000 renovation, he said, officials hope to sell it.
The lesson to other nonprofits, he said, is to avoid getting “involved in real estate without having the experts and paid staff that can run the real estate. Managing it is a whole different ball game.”