CLEVELAND, Ohio - The nonprofit organization responsible for revitalizing some of the city's most storied and impoverished neighborhoods has been failing for years.

Yet, the Buckeye Shaker Square Development Corporation has received hundreds of thousands of dollars each year in federal funds passed through the City of Cleveland, money that might be better spent by organizations with a stronger track record of community engagement and redevelopment.

The signs of trouble at BSSDC have been evident for years but have been discounted by Ward 4 Cleveland Councilman Ken Johnson, a 37-year veteran of City Hall politics and the organization's biggest benefactor. Each year, Johnson earmarks federal money - community development block grants - to go to the organization and insists the money be poured into a grass-cutting and lot-cleaning program that consumes much of the organization's time and resources. The program also employs one of Johnson's sons, and his City Council assistant, Garnell Jamison.

Once supported by additional tax dollars and foundation grants, BSSDC now struggles to pay its bills, including loan payments on commercial properties and property taxes. Johnson contends the financial troubles and other failings are no different than that of many similar organizations hurt by the recession and by the inherent challenges of investing in neighborhoods that are of little interest to developers.

Today, the organization's only visible service is its lot cutting and cleaning -- carried out by workers who drive a fleet of trucks branded with the words, "Compliments of Councilman Ken Johnson."

'Conflicts of Interest' and a second review

I recently reviewed a public paper trail leading back to BSSDC that should have city and federal officials questioning the organization's viability, leadership and the influence of Johnson over its affairs.

And it should leave taxpayers asking who's really paying attention.

To understand BSSDC's problems, I looked back to June 2015, when a small accounting company ended its relationship with BSSDC. In a letter explaining its decision, Your Bean Counters, which has worked with other community development groups and non-profits, said BSSDC was not fully cooperating. The accounting company also warned that BSSDC could not stay afloat if it continued to keep "people on the payroll who have direct conflicts of interests." The letter, which did not detail the conflicts, said the cost of these employees, which couldn't be covered by federal funds, created a yearly "unfunded deficit" of $180,000.

"That places an extraordinary burden on the organization and is the root cause of borrowing from vendors and lenders to keep the operation pretending as those [SIC] it is in status quo mode," the letter states.

The letter, a copy of which was sent to the City of Cleveland and others, triggered a second review of BSSDC's books, this time by Cleveland Neighborhood Progress, which supports community development groups and monitors grant money for some foundations. At the time, Cleveland Neighborhood Progress was managing grant money from the St. Luke's Foundation, which invests heavily in the Buckeye area and had directed $225,000 to BSSDC. Cleveland Neighborhood Progress and St. Luke's wanted to know if BSSDC was spending its grant money as promised.

So, they hired the Chicago-based audit and accounting firm RSM to perform of three-year forensic review of BSSDC and its handling of the grant money. RSM's findings, released in February 2016, included concerns that BSSDC's bookkeeping practices were inconsistent and its "general ledger reports" were missing groups of transactions. RSM said BSSDC didn't provide full documentation for some transactions related to its Multi-Media Youth Program, including $7,000 worth of cash withdrawals and more than $4,000 worth of charges from Amazon.com. RSM noted BSSDC was nearly $96,000 behind on property taxes and that the organization owed $110,000 in delinquent loan payments. RSM also found that the BSSDC failed to buy a new phone system with money specifically given to the organization for that purpose.

Councilman calls non-profit leader a racist

Following the report, St. Luke's Foundation cut off support for BSSDC, as did others.

The decision enraged Johnson, typically a low-key council member who often skips committee meetings and sits silently during council meetings. At a council meeting in July 2016, Johnson stood and delivered an extraordinary personal attack against Joel Ratner, the head of Cleveland Neighborhood Progress, accusing him of leading a conspiracy against BSSDC.

Johnson said that, in his opinion, Ratner, is a "bigot and a racist and shouldn't be doing what he's doing."

"We have this man going around talking to folks that represent Buckeye, and what he really wants to do is dissolve Buckeye or reform Buckeye with a board that is less black," Johnson continued. "That denies the black community the opportunity to decide which direction their community should go."

Johnson also criticized St. Luke's Foundation, but made no mention of the financial reviews that raised concerns about BSSDC's bookkeeping practices.

At the time, Ratner told cleveland.com's Leila Atassi that Johnson's comments did not deserve a response.

"We deeply value our relationships with council and respect the work that the vast majority of them are doing," he told her.

Ratner said recently he has nothing to add.

Johnson stands by accusations

Johnson told me in a recent interview that he stands by his comments and said his critics have been pushing negative stories about him and the BSSDC.

"You are the only one to pick up the story," he said about my inquiries.

Johnson said he believes Cleveland Neighborhood Progress and other groups want to control the neighborhoods in his ward and are pushing BSSDC to focus investment in areas near their favored Shaker Square.

As for the financial reviews, such as the one completed by RSM, Johnson said the reports can't be trusted because they were paid for by Cleveland Neighborhood Progress.

Johnson also defended BSSDC's lots program, which cut and cleaned more than 2,500 properties in Ward 4 and Ward 6 last year, according to BSSDC. He said that the lots program, which also includes snow-plowing services in the winter months, is vital to keeping seniors and other residents safe and living in the ward. BSSDC provides services the city can't, he said. More importantly, Johnson said, the program has employed hundreds of residents and taught them skills.

About his son being on BSSDC's payroll, Johnson said that for years he gave money from his own pocket to cover the salary, but didn't tell his son. He said his son was later paid by BSSDC but not with federal block grant money.

Johnson said no other family members are on the BSSDC payroll. The payroll does include Ozell Dobbins, a former City of Cleveland park's commissioner and friend of Johnson's.

Johnson surprised me when I asked him why several pick-up trucks, box trailers and a dump trunk used exclusively by BSSDC bear his name.

"I paid for those out of my pocket," Johnson said, though he acknowledged that the dump truck is owned by the city.

'We call our own the shots'

I also interviewed Hopkins, who has led BSSDC since 1994. He is more circumspect than Johnson, but he shares the view that the financial reviews are misleading. He said BSSDC can explain most issues flagged by auditors. For instance, he said, the RSM audit didn't recognize that the BSSDC is already working with Cuyahoga County to repay back taxes and that what auditors had claimed were undocumented withdrawals were actually purchases made on a debit card and backed by receipts. (You can read BSSDC's full response to the RSM audit, as well as other documents, in the box below.)

Hopkins said several of its developments failed in part because of the recession, and that if critics judge the organization solely by its real estate portfolio, BSSDC indeed looks like it's failing. But he said the organization has success with programs such as the lots program.

"We're creating jobs," he said. "You know people are hoping to feed their families. Keeping the community clean. You know some people would argue that has more value than just adding some houses."

Cutting lots is only a small part of the organization's stated mission, which includes acting as the key catalyst for commercial and housing development in the old Buckeye, Larchmere, Woodland Hills and Shaker Square neighborhoods.

In 2015, BSSDC received $900,000 in grants, according to its 2015 tax return, the latest available online. But other public records suggest that BSSDC is receiving much less today and BSSDC's income is largely just federal money earmarked by council members.

While Johnson and Hopkins downplay criticisms raised by outside groups, BSSDC's own board expressed concerns about the organization last fall. During a December board meeting, some board members demanded more transparency and one board member said the board should consider asking for Hopkins' resignation, according to two people familiar with the meeting.

"It was a heated discussion about, you know, what was going on with the finances," Hopkins told me. "So we did have a healthy discussion, but at no time did anyone ask for anyone's resignation."

Two board members, Appeals Court Judge Anita Laster Mays and Kim Thomas, who owns a business on Buckeye Road, quit the board shortly after the December meeting. Both confirmed to cleveland.com that they resigned but declined to discuss their reasons for leaving.

I also asked Hopkins whether Johnson wields too much influence over the organization, as some critics charge.

"We call our own shots," he said firmly.

More scrutiny on the way

Cleveland's Community Development Department is responsible for monitoring the financial health of community development organizations in the city and ensuring that they spend the federal money according to guidelines set by the U.S. Department of Housing and Urban Development.

BSSCD classifies the money it spends on the lots program - more than $200,000 in 2017 - as "Interim Assistance: Land Utilization."

Tania Menesse, the city's new director of community development, said that HUD allows money designated as interim assistance to be used for cutting grass and cleaning lots -- but only on a short-term basis and only on properties that are going to be put into "productive use" as part of a redevelopment plan within 24 months.

Menesse, who is a member of the St. Luke's Foundation board of trustees, said the scale of the BSSDC's program is also a potential problem.

"[BSSDC] has not shown many accomplishments in the past because most of the funds from the councilman are used for maintenance and grass cutting," she said. "We will have to look very closely at that this year."

The city gives federal block grant money to BSSDC, but reduced its allocation to $10,000 since the Community Development Department put the organization on "financial watch" in 2014 in recognition of the organization's financial trouble.

For the latest funding cycle, which began July 1, Johnson has earmarked $225,000 for BSSDC's lot program. Ward 6 Councilman Blaine Griffin set aside $135,000 for the organization, according to public records.

Griffin told me that many senior citizens rely on the lots program for help so he believes in supporting the program. But Griffin said he is also pushing BSDC to refocus on development plans that complement the city's renewed investment in the neighborhoods served by BSSDC.

"I'd like to see a model that more clearly defines the community and economic development goals associated with lot maintenance," he said.

At the moment, BSSDC is not going to get a penny because -- as of late Friday -- it has yet to provide an independent audit to the city, which is necessary to receive funding. Menesse said in a recent letter to BSSDC that the organization will be cut off completely if it doesn't send one by July 9.

And Menesse warned that going forward only 25 percent of the federal funds BSSDC receives will be eligible to be used for lot cutting and cleaning.

I told Johnson about city's concerns and forthcoming scrutiny. He said he's ready.

"The system worked fine for 37 years," he said. "Now, all of a sudden, there is a problem. But things change, and HUD has given their opinions about it and we will have to change some things. That's for sure."