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Kentucky At-Risk Youth Agency's President Resigns Following Inquiry


The president of the state’s largest non-profit agency for at-risk and foster children resigned late last week in the aftermath of an internal investigation of her performance. Neither she nor the organization’s board of directors would say why.Mary-Kate O’Leary, who took leadership of Louisville-based Uspiritus in 2012 following the merger of Brooklawn Child & Family Services and Bellewood Home for Children,is “stepping down” as president and CEO, board Chairman Neil Stamp wrote in a note to the organization's 320 employees last Friday. He wrote that the board will name an interim leader soon and begin a search for a permanent replacement.Uspiritus served more than 1,400 children in 2013 with mental-health services, family crisis intervention, foster parent training and residential treatment. Stamp said O’Leary’s departure will not affect that mission.In response to questions from the Kentucky Center for Investigative Reporting, Stamp said O’Leary’s departure was “voluntary.” But he did not address, either in that response or in his note to employees, the fact that O’Leary’s management style and some of her actions had been under investigation by the Uspiritus board the last two months.Nine current and former employees described a strained work atmosphere marked by high turnover, including at the executive level. They agreed to talk to KyCIR on the condition of anonymity, for fear of workplace retaliation.One source close to the investigation said that allegations were brought to the board’s attention by a group of Uspiritus managers, and that a team led by board members Janet Sims and Karen Long began an investigation.According to a March 28 letter from the board to O’Leary, the 45-year-old president was cleared of any misconduct.“We have concluded our investigation and believe the accusations to be unfounded,” the letter states. “The board continues to believe in your ability to lead Uspiritus.”But the letter shows that the board did not hold O’Leary blameless for the staff morale problems and management shortcomings. The document, viewed by the Kentucky Center for Investigative Reporting, required her to accept responsibility for the current state of the organization and to address the staff about moving forward.It also required her to undergo executive coaching with a consultant who would report on a regular basis to the board. Moreover, all hiring, firing and reassigning of staff at and above the director level would have to be approved in advance by the board chairman or the executive committee.

It isn’t known whether or not the terms were acceptable to O’Leary. Neither she nor Stamp returned phone calls after employees were notified of O’Leary’s departure Friday, and her attorney, Ruby Fenton, wouldn’t talk about the matter.In an earlier conversation, Stamp would not discuss the investigation, except to say that there was no misappropriation of funds. Whatever allegations were made about O’Leary, he downplayed them. “You’re catching a lot of stuff from some employees,” Stamp said.Uspiritus’ attorney, Jeff McKenzie, also would not discuss the investigation.Sims, who reportedly led the investigation, did not return phone calls for comment. A senior human resources managers at YUM Brands, she recently resigned from the board. Long, who also participated in the investigation, could not be reached for comment.O’Leary earned $164,202 in the fiscal year that ended June 30.Her abrupt departure capped a wide range of problems nagging the organization.Several former employees said chief financial officer Thomas Seel, vice president of human resources Marcy Clark and vice president of advancement Paula Campbell all left in the past five months.According to a tax return posted on its website, Uspiritus ended its 2013 fiscal year last June 30 with a $591,582 operating deficit. And questions were raised about the care of children last May after a teenage boy who was supposed to have been under close supervision hanged himself. Uspiritus declined to provide information about the death.Uspiritus has five offices in the state, provides care for children and youth from birth to age 19 and has served families from most of Kentucky’s 120 counties during the past three years, according to its website.Because of its vital role in caring for “broken and shattered kids,” as Uspiritus calls them, the internal strife and its potential impact on already troubled children have alarmed others in the child welfare community.Bill Smithwick, former president of Sunrise Children’s Services, another child-care agency, said he was “saddened” to hear that O’Leary had resigned. He said he and others in the business had been aware of “upheaval” at Uspiritus. He expressed hope that its board “would move forward very soon to get some leadership to stabilize the organization.”This story was reported by the  Kentucky Center for Investigative Reporting, part of  Louisville Public Media. You can find out more and see more stories  at the KyCIR website.

R.G. Dunlop is an award-winning investigative reporter whose work has exposed government corruption and resulted in numerous reforms. Email R.G. at rdunlop@lpm.org.