In wake of mass layoff notices, LGBT Community Center volunteers question handling of massive donation

Three years ago, long before the San Diego LGBT Community Center warned its 100-plus employees that they could be laid off within weeks, the venerable Hillcrest nonprofit received an astonishing and unexpected gift of almost $19 million.

The sudden windfall — more than double its total expenses in 2022 — was donated by Maurice Thimot and M. Rust Rawnsley, a couple from Fallbrook who wanted their money to help other gay seniors less fortunate than themselves.

The contribution was paid in two installments, $10 million awarded that first year and $8.9 million last fall.

But the cash infusion did not keep The Center’s leaders from telling employees they could all lose their jobs as soon as next month. The organization filed a notice with state officials alerting them to the potential mass layoff early last month.

It’s not clear what specific restrictions the gift came with, or whether they might bar spending the money on payroll.

The Center said the gift’s purpose “is to help seniors who need us today while also allowing us to plan for the future expansion of programs and services for LGBTQ+ older adults in need of safe and stable housing.”

Center officials insisted the layoff notices were strictly precautionary. But longtime volunteers and clients are nonetheless raising questions about how the donation is being used — or not.

“That $19 million could make a huge difference in the lives of LGBT seniors, but it’s being spent in drips and drabs,” said Elaine Lewis, who served as chair of The Center’s senior advisory committee before the panel was disbanded in April.

“The Center has an amazing opportunity to leave an incredible legacy, but what they are doing won’t have any lasting impact,” she said.

Lewis, who spent nine years on the senior advisory committee before it was dissolved, said she and other volunteers began asking about how the gift might be invested — and suggesting new projects — as soon as they learned about the contribution.

“The more questions we asked about how The Center planned to use the money, the more obvious it became that we were not getting accurate information,” she said.

Officials from The Center concede they have not developed new capital projects for the major donation. They said restrictions on the gift preclude anything like senior housing, so they are expanding other services.

“We understand that some community members have asked for a dedicated senior center,” spokesperson Gus Hernandez said. “While we deeply value that vision, the restricted nature of the bequest means we cannot use these funds for capital construction related to a senior center.”

Hernandez said the nonprofit has made investments to upgrade some facilities — improvements he said benefit everyone.

“The reorganization of our lobby and shared spaces was designed to improve accessibility and increase capacity for our entire LGBTQ+ community, including those who are seniors,” he said. “At The Center, Senior Services and programming is woven into everything we do.”

The Center has no chief financial officer currently managing its $32 million in assets, according to its website. Lewis said two CFOs left within the past year.

“Now they have a vice president of accounting,” she said.

Hernandez said the senior advisory committee has not gone away but is in the process of being restructured.

“The new structure includes clear expectations: committee members must be active volunteers, participants in our programs and services, and able to commit to a term of service,” he said.

In an April newsletter, two co-chairs of The Center’s board of directors said they had directed $350,000 annually over 10 years from the Thimot and Rawnsley Fund to be used to pay for senior services.

They also said interest from the donation would support the general fund because more than 35% of all clients are seniors.

“Over the last three years, The Center has been able to use this extraordinary gift to increase services and social opportunities for seniors, resulting in doubling the number of seniors served,” board directors Ben Mendoza and Shaun Randall Travers wrote.

“We now have an adult housing program and offer our congregate meal program daily,” they said. “We brought back the Red Hot Dance and the Ageless Artists art show and introduced new exercise and social programs.”

No one from The Center board of directors commented on the organization’s handling of the nearly $19 million gift. Mendoza said he is no longer serving as co-chair.

Longtime donor and client Charles Kaminski said the new programming for seniors, including art classes and dances, is welcome, but he said The Center has cut back on drop-in hours and a lunch program dedicated to seniors.

“No explanation, as far as I can tell, was given,” he said.

The retired architect from Talmadge said he and a core group of others have struggled for three years to get even basic information out of center officials.

Kaminski said it took months to get a copy of the bylaws even though state law requires they be made available to anyone who asks. He said the group has been unable to see a copy of the rules governing the $18.9 million gift.

“Let’s get that out of the way, so then we can start talking about how best to utilize $19 million for senior services and programs, whether it’s housing, food resources (or) a senior center, which we are pitching,” he said.

Hernandez said in written responses to questions that The Center is actively planning for the long-term use of the donation from Thimot and Rawnsley so it aligns with the donors’ wishes to aid the local LGBTQ+ senior community.

“This plan will prioritize senior housing and related services, and we are exploring sustainable models that maximize impact while preserving the fund’s longevity,” he said.

Thimot and Rawnsley lived for decades on 40 acres they owned in the Rainbow community just outside Fallbrook. Thimot, born in Nova Scotia, worked as a property manager before he died about 20 years ago; Rawnsley, or Rusty to his friends, was a retired electrician and died four years ago.

The Center, which dates back to 1973, provides a host of services to the LGBTQ+ community across greater San Diego.

Among other things, it conducts HIV prevention and screenings and offers mental health resources and counseling for women, transgender people and other underserved groups. It also offers sexual health and other wellness programming.

The controversy over how to invest the massive contribution was exacerbated by the layoff notices The Center issued last month — notices it says were precautionary measures taken in case federal grants are withdrawn.

But federal revenue accounts for only a fraction of The Center’s total income. Hernandez said less than one-third of the nonprofit’s $15.5 million in annual spending, or about $4.4 million, comes from U.S. government grants.

Days after the Union-Tribune reported that The Center filed its WARN Act notice — a move one legal expert said was taken only when job eliminations are “certain” — CEO Cara Dessert issued a statement saying no downsizing was imminent.

“As of today, there are no plans to lay off any staff members,” she wrote last week. “However, because federal grants can be terminated at any time, The Center recently issued the WARN Act notice to all staff as a precautionary measure.”

The so-called WARN Act notice, short for the Worker Adjustment and Retraining Notification law, is required to be publicly noticed with regulators anytime an employer is considering mass layoffs.