MARTINEZ -- Despite pleas for more time to repay the county more than $363,000 in misspent tax dollars, a longtime mental health services nonprofit lost its Contra Costa County contracts Tuesday.

The Board of Supervisors voted 4-1 to end the county's 35-year relationship with Concord-based Mental Health Consumer Concerns as of Dec. 31. The company has four contracts with the county worth $1.85 million for services including three mental health wellness centers in Antioch, Concord and Richmond.

Mary Hogden, the nonprofit's executive director, confirmed after the hearing that the organization would be forced to close its doors by the end of the year, file bankruptcy and put about 40 employees out of work.

"It's a very sad day," said a tearful and stunned Hogden.

Several members of the nonprofit's board of directors conceded they made mistakes but assured supervisors that they had replaced key managers and vowed to repay taxpayers through grants and donations.

The county is fast-tracking its search for new mental health service providers, but there likely will be some gaps, staff said.

County supervisors expressed regret for the fiasco -- after verbally lashing their own staff repeatedly for the lax contract oversight that allowed the debt to reach such a fearsome number -- but said the nonprofit's fiscal health appeared beyond rescue.


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"I'm not comfortable moving forward with (Mental Health Consumer Concerns) after hearing and seeing everything that has occurred this morning," Supervisor Mary Nejedly Piepho said following the staff account, along with conflicting and contentious testimony from the nonprofit's representatives and former employees. "I think we need to shake hands, draw the line and say goodbye."

Only board President Federal Glover of Pittsburg voted against ending the contracts, saying the county should take more responsibility for its role in the nonprofit's financial failure.

"This is an agency that has been around for more than 30 years and has provided, by all accounts, great services," Glover said.

In response to complaints filed earlier this year through the county's Mental Health Commission, a county investigation revealed that since 2007, the nonprofit was setting aside 15 percent of its contract payments into a reserve account rather than spending it on direct services that same year, as the terms of the contract required.

Just over half of the money was spent for legitimate purposes but in the wrong year, while the balance went to nonapproved expenses categorized as "restructuring," county staff told the board.

The county expects to recoup roughly $200,000 by applying to the debt the nonprofit's costs of providing services through the end of the year. "It is shocking that it has continued this long, and it makes me very nervous about what else is out there," said Supervisor Candace Andersen of Danville. "I hope we have better oversight on our other contracts."

Contact Lisa Vorderbrueggen at 925-945-4773, lvorderbrueggen@bayareanewsgroup.com or Twitter.com/lvorderbrueggen.