A $900,000 grant by the Baltimore Children and Youth Fund (BCYF) to a nonprofit organization known as Thrive Arts Inc. in 2022 is the latest evidence that Baltimore’s version of the “nonprofit industrial complex” wields too much power. As reported by The Baltimore Sun, Thrive Arts was incorporated in 2021 but lost its corporate charter last year after failing to file tax returns for three straight years, and is now defunct.

It was an extraordinarily large grant for a small organization with no proven track record. Yet to be confirmed is how much of the $900,000 was disbursed to the grantee and spent on the purposes for which it was intended or returned to the city.

The term nonprofit industrial complex (NPIC) is a takeoff on references to the military industrial complex. It describes a codependent relationship between government agencies and nonprofit service providers funded by those agencies, a relationship that sometimes enriches and empowers nonprofit service providers at the expense of the best interests of the public.

Although the cast of characters has changed over the past decade or so, the NPIC is thriving in Baltimore. That has not necessarily been good news for transparency and accountability. The Baltimore Children and Youth Fund, which the city has empowered to dole out taxpayer funds to local organizations, is a prime example.

Proponents of the BCYF stated it was their intent to protect Black grassroots organizations from being elbowed aside by large, established charities and other nonprofit service providers when it came to the distribution of BCYF funds. As worthy as that goal may be, it is increasingly apparent that it is being pursued with little regard as to whether BCYF grants end up being used for their approved purposes.

The city charter amendment approved by the voters in 2016 allowed the City Council to outsource administration of the BCYF to a nonprofit organization free from the checks and balances applicable to city agencies, including the requirement for biennial performance audits. The council named a newly formed nonprofit corporation, Baltimore Children and Youth Fund Inc., as the permanent “fiscal agent” of the fund in 2020.

Unfortunately, the council didn’t enact measures to hold this newest member of the city’s NPIC to the same standards of transparency and accountability as city agencies, even though it receives about $14 million per year in city funds. The results have been predictable, with the BCYF used for things other than programs and services benefiting children and youth as required by law.

A spokesperson for City Comptroller Bill Henry admitted that the city doesn’t “have detailed insight into BCYF’s spending and programming” and stated that his office was “actively cultivating a stronger relationship with BCYF to understand their strategies and be a resource for fiscal prudence.” Nonsense. What is needed are ordinances enforcing fiscal prudence that don’t depend on “cultivating relationships.”

The growing extent to which Baltimore’s NPIC is able to influence city policy was on display during the City Council’s consideration of the Port Covington project in 2016. A coalition of nonprofit faith-based and community groups led by Baltimoreans United in Leadership Development (BUILD) helped persuade the council to approve a $660 million public financing package for the controversial project after the coalition negotiated a massive $135.9 million community benefits agreement (CBA) with the developer.

In effect, a large chunk of money made available by the public financing will make its way into the coffers of community organizations participating in the CBA. Lines between private interest and the public’s interest get blurred in the NPIC.

More evidence of BUILD’s political muscle came in 2023 when Mayor Brandon Scott announced that the city was partnering with BUILD and the Greater Baltimore Committee (GBC) to carry out a $3 billion plan to rehabilitate vacant properties. Scott chose to partner with BUILD rather than use a state-authorized land bank authority to manage the complex task of returning vacant properties to productive use, the means employed by almost all other cities with a vacancy problem as large as Baltimore’s.

Scott hasn’t explained how the partnership will work. The agreement with BUILD and GBC states that the parties “remain open-minded about how these relationships will be structured and implemented.” That sounds a lot like “we’ll make up the rules as we go along” and even more like BUILD is calling the shots. The evolution of Baltimore’s version of the NPIC toward more non-traditional service providers brought its own set of challenges. To date, the city has not been up to those challenges. Indeed, it has allowed the situation to drift further and further out of control.

David Plymyer (X: @dplymyer; dplymyer@comcast.net) retired as county attorney for Anne Arundel County in 2014. He lives in Catonsville.