Caring for Denver spends public funds on alcohol, problematic grantees

Caring for Denver spends public funds on alcohol, problematic grantees

Published on February 19, 2026

En español(PDF, 170KB)

DENVER - The Caring for Denver Foundation, a nonprofit receiving city tax dollars, issued funds to grantees that submitted falsified, misleading, and incomplete applications, according to a new audit from Denver Auditor Timothy M. O'Brien, C.P.A. The audit also found some grantees spent funds on unallowable uses. Caring for Denver staff spent thousands on food and alcohol for meetings using taxpayer dollars. The foundation disagreed with seven out of 15 - or 47% - of our recommendations to improve accountability, transparency, and financial oversight.

"Voters approved millions of tax dollars to help Denver residents, but Caring for Denver doesn't ensure its spending is effective or even appropriate at times," Auditor O'Brien said.

In 2018, Denver voters passed an ordinance increasing sales and use tax by 0.25% to create the Caring for Denver fund. The city contracted with the Caring for Denver Foundation to manage the fund, and its mission is to address Denver's mental health and substance misuse needs. By the end of 2024, the foundation awarded more than $185 million in grants to 270 different organizations providing community support.

Problematic grantees receiving funds

We found Caring for Denver was not always ensuring submitted grant applications were accurate or complete. Three grantees falsely reported partnerships with other agencies. One of them received a grant of about $310,000.

Foundation staff said they do not verify all claims grantees make in applications and were not evaluating applications thoroughly. Some grant applicants received funding even though they were missing important documentation that the foundation required.

In a sample review, we found 14 out of 35 - or 40% - of grant application packets were missing at least one required financial document.

One grantee executive director applied for and received $568,000 to work with children and families but had a prior formal allegation of domestic violence with children present filed with the courts.

Leading practices say a thorough review of an applicant, including identifying financial and legal risks, assesses suitability.

Caring for Denver issued 10 grants that did not align with city ordinance. Two grants totaling $26,000 went to two grantees for self-care, wellness, quarterly full-day staff retreats, healing circles, hazard pay, and paid time off for their staff. City ordinance does not say that taxpayer dollars should be used for these purposes.

The foundation disagreed with recommendations to improve the grantee review, grant selection and grant issuance processes.

"It is troubling that Caring for Denver is not always verifying grantees are telling the truth nor confirming grantees are spending money as voters intended. The foundation's approach to trust grantees but not perform thorough due diligence is careless. It harms the city's and Caring for Denver's reputation as good stewards of taxpayer money," Auditor O'Brien said.

Inability to verify data

Caring for Denver does not require grantees to provide specific demographic and geographic data nor does it verify the accuracy of the data it does receive, so it cannot appropriately measure whether a program is effective. This means information the foundation reports out may be inaccurate and could mislead city decision-makers and the public.

The foundation disagreed with our two recommendations to establish data sharing agreements to outline data requirements and protections, and to validate grantee data.

Unallowed alcohol and meal expenses

A foundation executive and some staff regularly paid for meals and alcohol with taxpayer funds. We reviewed a sample of 734 administrative expenses and found 598 were related to meal reimbursements. More than 200 meals were reimbursed to the executive, and at least 75 included about $3,130 spent on alcohol. In more than 70 occurrences at one restaurant, the executive bought drinks costing over $20 each.

The same executive received an average reimbursement of four meals per week. Several times they claimed over eight meals a week, with one week where they claimed 10 meals.

City rules allow for food and beverage costs to be reimbursed only when they are necessary to carry out an agency's mission, not for alcohol or routine meals.

Executive staff justified these costs as integral to Caring for Denver's work because occasional face-to-face meetings are needed to build relationships. They also said these types of meetings and expenses aligned with "foundation best practices." They did not explain why meetings need to occur over a meal, with or without alcohol.

Caring for Denver and the Denver Department of Public Health & Environment disagreed with our recommendation to amend the contract to require the foundation to adhere to city Fiscal Accountability Rules involving food and beverage expenses.

"These expenses show a disregard for fiscal accountability. I question whether it is best practice for taxpayers to foot the bill for alcohol and meals in the amount and frequency we discovered," said Auditor O'Brien. "Caring for Denver's disagreements to our recommendations suggest the foundation does not want to be accountable for these expenses or its grantee oversight. It's disappointing that Caring for Denver is not delivering what voters approved."

We will follow up on the recommendations Caring for Denver agreed to at a later date and determine whether there are outstanding risks.

AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor

Denver Auditor's Office

201 W. Colfax Ave. #705 Denver, CO 80202
Email: [email protected]
Call: 720-913-5000
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