Caring for Denver Foundation

By voting for the Caring for Denver Fund, Denver voters entrusted the foundation to spend millions of taxpayer dollars to help Denver residents. If the foundation is not being a good steward of this money, it risks eroding voter trust, wasting city funds, and not helping the residents who need it most.

FINDING 1 – Staff regularly claim taxpayer-funded meal and alcohol expenses

• A foundation executive and staff regularly paid for meals and alcohol with taxpayer funds. Of the 734 administrative expenses we reviewed, 598 — or 81% — were related to meal reimbursements totaling about $28,200.

FINDING 2 – The foundation’s inadequate grant management processes must be improved

• Foundation staff were not always ensuring grant applications were complete and were not consistently evaluating them. Of the 35 grant applications we reviewed, 14 were missing required documentation and seven were reviewed improperly.

• The foundation awarded funding for grants that did not align with the ordinance. Ten out of the 35 grant applications we reviewed were awarded to fund grantee resources like self-care and quarterly retreats for grantee staff as well as data collection training for grantees.

• The foundation relied on self-reported data from grantees and did not verify the data was accurate.

FINDING 3 – The foundation is not ensuring conflict-of-interest forms are submitted on time

• Foundation leaders were not ensuring board members and staff submitted conflict-of-interest and outside employment forms on time. Of the 152 forms we reviewed, 42 — or 28% — were late.

1.1 Amend the contract – The Denver Department of Public Health & Environment should work with the Caring for Denver Foundation and the City Council to amend the contract between the city and foundation to require the foundation to adhere to the relevant city Fiscal Accountability Rules. The contract should require, at a minimum, that the foundation comply with rules for supporting documentation, propriety of expenditures, and food and beverage.

Denver Department of Public Health & Environment – Disgree

1.2 Revise expense reimbursement policies and procedures – The Caring for Denver Foundation should revise its employee reimbursement policies and procedures to require, at a minimum, the submission of key documentation:

• Itemized receipts for all expenses.
• Names and affiliation of attendees present at events, meals, etc.
• A detailed description of the business purpose.

Policies and procedures should also clarify additional expense requirements such as when U.S. General Service Administration per diem rates should be used, what documentation is required to support the business travel purpose, when preapproval is required, and how preapproval will be documented.

Caring for Denver Foundation –  Agree, Implementation Date – April 30, 2026

1.3 Develop and document expense review policies and procedures – The Caring for Denver Foundation should develop, document, and implement policies and procedures for reviewing and approving expense reimbursements. These policies should include, at a minimum:

• Who is responsible, e.g., employees, board members, etc.
• How documentation is reviewed.
• What processes are required when supporting documentation is insufficient.

Caring for Denver Foundation –  Agree, Implementation Date – April 30, 2026

2.1 Expand the due diligence process – The Caring for Denver Foundation should expand its due diligence process and procedures to include, at a minimum, the following:

• Verifying the financial and legal histories of applicant leaders and key staff does not increase risk to the foundation.
• Confirming applicants’ standings with the Colorado Secretary of State’s Office, if applicable.
• Verifying partnerships exist between applicants and other organizations.
• Verifying all required documents are included with each grant packet. Documentation from any previous applications or grant packets should not replace current requirements, and documentation should not be in draft form.

Caring for Denver Foundation – Disagree

2.2 Develop, document, and consistently implement due diligence policies and procedures – The Caring for Denver Foundation should develop, document, and consistently implement policies and procedures for conducting due diligence of all grantees. Policies and procedures should include, at a minimum:

• Who is responsible for conducting each due diligence step.
• How and where due diligence reviews and findings will be documented.
• A checklist or similar outlining steps to be completed as part of due diligence reviews.
• A process for handling due diligence findings, such as falsified partnerships or missing documentation the foundation requires.
• Who is responsible for reviewing completed due diligence reviews and how this will be documented.

Caring for Denver Foundation –  Agree, Implementation Date – Aug. 31, 2026

2.3 Develop and provide training – The Caring for Denver Foundation should develop and provide training to staff responsible for conducting due diligence reviews. The training should include how due diligence will be conducted and documentation supporting attendance should be retained.

Caring for Denver Foundation –  Agree, Implementation Date – Aug. 31, 2026

2.4 Revise the Caring for Denver ordinance – The Caring for Denver Foundation and the Denver Department of Public Health & Environment should work with the City Council to propose an amendment to the ordinance to include and define allowable purposes for innovative and responsive grants, including but not limited to capacity building and staff wellness.

Caring for Denver Foundation and Denver Department of Public Health & Environment – Disagree

2.5 Develop and implement a standardized scoring and review process – The Caring for Denver Foundation should create a standardized process aligned with leading practices, like PEAK Grantmaking and AmeriCorps, and based on objective criteria to rank and compare grant applications. The foundation should implement a multistage review process for scoring that includes quantitative scoring against set criteria, a qualitative review of the applicant organization and application, and a ranking stage.

Final decisions and selection rationale should be documented for each review. Areas to be assessed should include, at a minimum:

• Alignment with the foundation’s mission and the ordinance.
• Financial stewardship.
• Resource allocation.
• Organizational capacity.
• Quality of the proposed work.
• Results of due diligence findings.

Caring for Denver Foundation – Disagree

2.6 Develop, document, and implement policies and procedures for the grant selection process – The Caring for Denver Foundation should develop, document, and implement policies and procedures for grant selection that mandate using the process identified in Recommendation 2.5, multistage reviews, and ranking methods for all funding decisions. It should also define, at a minimum:

• Who is responsible for final decisions.
• The criteria and thresholds needed for moving applications between review stages.
• The procedures for resolving score discrepancies or conflicts of interest.

Caring for Denver Foundation – Disagree

2.7 Enforce compliance with grant requirements – The Caring for Denver Foundation should enforce all grant requirements as part of end-ofproject monitoring. The foundation should develop and communicate the consequences of noncompliance, like repaying the foundation for the grant or being ineligible for future funding.

Caring for Denver Foundation –  Agree, Implementation Date – Aug. 31, 2026

2.8 Establish and implement data sharing agreements – The Caring for Denver Foundation should incorporate data sharing agreements into their grantmaking processes for future grantees and work with current grantees to establish data sharing agreements for allocated future grants.

These agreements should outline, at a minimum, what data that supports programeffectiveness must be gathered, when unique identifiers will be used to protect clientconfidentiality, and how the foundation will protect sensitive data.

Caring for Denver Foundation – Disagree

2.9 Strengthen oversight through source data validation – The Caring for Denver Foundation should revise its data monitoring policies and procedures to add a formal step to validate grantee data against source documents to improve data accuracy and reliability, as well as transparency to the public.

Caring for Denver Foundation – Disagree

3.1 Formally document submission due date – The Caring for Denver Foundation and its board should formalize its Jan. 31 due date for conflict-of-interest and outside employment form submission in its policies and procedures and document the consequences of noncompliance.

Caring for Denver Foundation –  Agree, Implementation Date – April 30, 2026

3.2 Communicate submission due date – The Caring for Denver Foundation and its board should communicate the Jan. 31 due date to staff and board members.  

Caring for Denver Foundation –  Agree, Implementation Date – April 30, 2026

3.3 Enforce compliance – The Caring for Denver Foundation and its board should establish a tracking method for form submission and enforce compliance with its conflict-of-interest and outside employment form policies, including established due dates.  

Caring for Denver Foundation –  Agree, Implementation Date – April 30, 2026

Auditor’s addendum to agency response for Recommendation 1.1

As discussed in this audit report, the city’s Fiscal Accountability Rules are not inherently applicable to the Caring for Denver Foundation. However, the Denver Department of Public Health & Environment already requires the foundation to follow fiscal rules related to grantmaking in the contract, thereby recognizing the value of holding taxpayer funded organizations accountable to the same rules city agencies and employees must follow.

Fiscal Accountability Rules promote accountability for spending, ensure legal use of public funds, promote strong internal controls, and most importantly maintain public trust.

In 2018 Denver voters approved funding for mental health services and treatments for children and adults with accountability and transparency from the city’s nonprofit partner. It remains unlikely that Denver residents intended their tax funds to be spent on routine meals and alcoholic beverages, especially because these items are prohibited uses of city funds. Additionally, the foundation’s own board members responsible for approving reimbursements did not believe alcohol or regular meals should be paid for by the foundation.

This recommendation to comply with certain fiscal rules such as those around supporting documentation, propriety of expenditures, and food and beverage, ensures that all parties are held to the same standards of accountability, transparency, and responsible stewardship of taxpayer funds.

Finally, if the foundation and its board agree that paying for regular meals and alcohol is a necessary business expense, the ordinance permits the foundation to seek additional funding for these expenses outside of city tax dollars.

We reaffirm our finding and recommendation.

Auditor’s addendum to agency response for Recommendation 2.1

As discussed in this audit report, we found many instances in which the Caring for Denver Foundation’s due diligence process failed to identify risks before funding grant applications. The foundation did not verify partnerships were real, did not research whether grantees complied with mandatory state regulations, and did not conduct financial and legal investigations to identify risks. These all point to shortcomings in the foundation’s existing processes.

Furthermore, as discussed in the background section of this report, investigative reporting by the Colorado Public Radio highlighted similar risks in December 2022. Specifically, the foundation was found to have funded programs run by people with questionable tax records, felony convictions, or who were charged with violent crimes. Similar to our analysis, the report also identified instances where the foundation funded organizations with falsified partnerships and experience.

Leading practices from Good Grants and Grantmakers for Effective Organizations recommend grant makers confirm applicants are representing themselves accurately and that they do not carry serious legal or financial problems. The recommendation does not explicitly require the foundation to conduct background checks. Rather, the foundation could have identified an alternate method to identify legal and financial risks.

One of the foundation’s aims is to ensure it is a trusted and effective steward of taxpayer dollars. This recommendation ultimately strengthens the foundation’s due diligence process and better aligns it with its own goals. We reaffirm our finding and recommendation.

Auditor’s addendum to agency response for Recommendation 2.4

The ordinance says that the Caring for Denver tax revenue should be used for the explicit purposes outlined in Figure 4, with 10% of the funding being granted to the city for things like funding a facility and staff to create alternatives to jail or training for first responders. Additionally, the foundation is allowed to use no more than 5% of the revenue in any year for administrative purposes. However, the ordinance does not define “innovative” nor “responsive” grants.

While the foundation mentioned upcoming sales tax initiatives, ordinance revisions, and contract negotiations in its response, the foundation’s disagreement with this recommendation signals leaders are not prioritizing clarity or increased transparency around the use of tax dollars.

We reaffirm the importance and need to clarify what “innovative” and “responsive” grants include when using taxpayer funds to pay for them.

Auditor’s addendum to agency response for Recommendation 2.5

As discussed, the foundation lacks a formal, quantitative method to objectively compare grant applicants. Instead, the foundation uses a qualitative assessment process, which relies on the subjective judgment of those reviewing applications.

Establishing additional criteria to incorporate both quantitative and qualitative assessment methods, as recommended by leading practices the foundation says it follows, would allow for a more fair and objective comparison of each application and increase transparency of the selection process.

Without objective criteria, the foundation also increases the likelihood of granting funding to organizations it has a relationship with over other qualified applicants and increases the possibility of funding organizations that may have met the qualitative criteria but are missing required documents.

In its response, the foundation said it had a criteria-based process. During interviews with multiple staff, we were told the foundation did not have any sort of rubric or scorecard with which to rank and compare applicants. In September 2025 at the end of fieldwork, the foundation provided a draft document that used the terms “insufficient,” “satisfactory,” and “strong” to describe certain aspects of each applicant. It also had a section for identifying risk factors, including financial risks. While it’s possible we did not find evidence of the document’s use in our analyses because it was implemented after our audit period, no program staff mentioned this document in any interview.

It appears the foundation does agree with the notion of objectively comparing applicants through a standardized process if this document is to be used when it is finalized. It is therefore disappointing that the foundation disagreed with the recommendation.

We reaffirm our finding and the recommendation.

Auditor’s addendum to agency response for Recommendation 2.6

In addition to recommending implementing a quantitative assessment method, which would allow for a fairer comparison of each application and increase transparency of the selection process, this recommendation also aims to standardize and clarify the foundation’s selection process. As discussed in the audit report, we found instances where due diligence issues were not documented, corrected, or considered in the selection process. Also, organizations were granted funding despite submitting incorrect or incomplete required documents.

We reaffirm our finding and recommendation.

Auditor’s addendum to agency response for Recommendation 2.8

Leading practices, including those from PEAK Grantmaking — an organization the foundation recognizes as an industry leader, say that collecting and analyzing actual geographic and demographic data improves transparency on how money is allocated across the city and offers valuable insights into how funds are being used.

The foundation cannot accurately collect and analyze this data using current practices that are based on trust in funded organizations. Also, foundation leaders claimed grantees expressed concern over sharing sensitive data. As a result, we recommended the foundation establish agreements with the organizations to help alleviate these concerns.

Data sharing agreements are intended for any entity, whether public or private, where the exchange of data is required. The purpose of the agreement is to outline the types of data to be collected — such as personal, geographic, or demographic — and how the data will be protected, among other things. There may also be agreements regarding costs associated with data collection. By implementing such an agreement with grantees, the foundation could ensure data from each organization is consistent and in support of foundation goals, strategies, and objectives.

Furthermore, data sharing agreements do exist between city agencies and private nonprofits for the purpose of sharing similar, sensitive data. For example, in our 2024 Co-Responder Expansion Grant and Contract Compliance follow-up report, we found the Denver Police Department and WellPower, a nonprofit organization, finalized a data-sharing agreement where the nonprofit would provide both aggregate data and certain limited protected data, such as name and date of birth, to the department. The purpose of this agreement was to allow the police department access to the data it needed to support the effectiveness of the Co-Responder Program — which also received funding from the Caring for Denver Foundation.

The foundation has demonstrated its desire to help grantees improve data collection by employing third party assistance for select organizations. This recommendation is essential to realize a return on this investment, increase transparency, and ensure taxpayer funds are being used in compliance with the Caring for Denver ordinance and other foundation funding goals.

We reaffirm our finding and recommendation.

Auditor’s addendum to agency response for Recommendation 2.9

Source data validation is one method for ensuring data is accurate and reliable in addition to interviews and document reviews. The foundation already conducts interviews with grantees; however, the data still had errors. Furthermore, the zip code information used in the annual report comes from the application and estimated reach and impact area rather than where services were provided. This paints a false picture to the public of where grantees are using city taxpayer funds.

It is appropriate for the foundation to use a sample to validate some data as opposed to all, which would reduce the burden and cost for validating all grantee data. Further, we are not asking the foundation to report individual-level data to the public with this recommendation. We are asking it to use grantee source-data to validate that the data provided by grantees is truthful and accurate before it is aggregated and reported out.

Finally, the foundation’s concerns with confidentiality and privacy risks would have been mitigated by implementing Recommendation 2.8.

Without verifying the accuracy of data provided by grantees, the foundation is not only unable to ensure it is compliant with the ordinance in providing funding for only Denver residents, but it also cannot prove that the organizations are effective at helping people in the ways voters intended.

Further, organizations that received funding may inflate numbers showing program success to obtain future grants from the foundation.

We reaffirm our finding and recommendation.