Attorney For Ex-ACAP Director Charges DA With Giving Cover To Elected Officials

Mar. 1, 2012 | An attorney for the former executive director of an Alameda County anti-poverty agency, since disbanded, says a criminal complaint filed by the county district attorney is a political tit-for-tat for elected officials on the agency’s board to deflect blame. He also contends she was fired only after blowing the whistle on the board to officials in Sacramento.

The attorney for Nanette Dillard, the former executive director of the Associated Community Action Program (ACAP), and her husband, Paul Daniels, a grant writer for the same program, called the complaint “completely baseless and false.”

“The complaint was brought by the District Attorney as a political favor to the elected officials on ACAP’s board who were tasked with managing the organization, but instead destroyed it through their gross negligence and complete abrogation of managerial responsibilities,” their attorney, John Runfalo, said Wednesday.

“This case is nothing but a smear campaign pushed on the District Attorney’s office by the politicians serving on ACAP’s board whose gross mismanagement caused the organization to collapse,” said Runfola. “Those same politicians–who appointed District Attorney O’Malley to office and control her budget every year–are looking for someone else to blame for their mistakes. It’s how politicians operate.”

The charge against the ACAP Governing Board appears to single out Alameda County Supervisor Nate Miley among the 13-member body, which includes elected leaders from the city councils of every county city, excluding Oakland and Berkeley. While alleged misdeeds at ACAP may have been occurring, critics have also heaped scorn on the board which had not attained a quorum of seven members to meet after nearly a year. ACAP’s finances became public in February 2011 after employees complained of bounced paychecks. Dillard and Daniels were fired over two weeks later.

The couple, however, filed a lawsuit against the governing board in April 2011 alleging it violated the Brown Act by meeting in closed session Feb. 2, 2011 to place her on administrative leave. The agenda from that day did not mention such an action beforehand, the suit argues. They also contend the governing board failed to hand over public records involving a letter from ACAP employees to the board that led to their dismissal Feb. 2, 2011. An organizational assessment of ACAP written by Dillard herself was also denied in the records request. An Alameda County judge last month ordered the ACAP Governing Board to honor the the records request.

The attorney for Dillard and Daniels says the documents prove their innocence. “Ms. Dillard later made public records requests to obtain information that would clear her of wrongdoing,” said Runfalo. “In an apparent cover-up attempt, County officials refused to turn them over in what the Alameda Superior Court has ruled was a violation of the Public Records Act.”

District Attorney O’Malley’s office last week charged with Dillard and Daniels with felony grand theft, a crime by a public official and conspiracy. The complaint alleges the couple misappropriated state and federal grants. Included in the complaint are allegations they used ACAP staff to perform home improvement services at their residence. But, Runfalo says the complaint alleges they used the funds on payroll and other expenses and “not on personal enrichment.”

“The $1.5 million figure released by the D.A.’s office to the press, like the complaint itself, was a fabrication to achieve favorable media spin,” said Runfalo.

Brendan Hickey, the attorney for Daniels said, “Paul Daniels did not steal one cent of the taxpayers’ money and he did not break the law,” and added,  “Mr. Daniels is being prosecuted by the District Attorney–-despite an obvious conflict of interest–not because he did anything wrong, but because he happened to be married to ACAP’s Executive Director, Nanette Dillard. And because it is politically convenient to blame Ms. Dillard for ACAP’s collapse in an election year.”

Brad Yamauchi, an attorney for Dillard representing her in a whistleblower lawsuit against ACAP said, “When Ms. Dillard alerted ACAP’s governing board of significant accounting discrepancies in ACAP’s budget, they did nothing. When she sent a whistleblower letter to state officials in Sacramento informing them of the same discrepancies, they fired her.”

While all 12 cities in the ACAP joint powers agreement agreed to wind-down operation of the agency last year and pay equal shares of its dissolution, there continues to be questions over what occurred at ACAP and who was aware of the troubles ultimately leading to its demise.

In court documents filed last year by Dillard against the ACAP Governing Board and comments made by during their meetings in February 2011, it is likely Miley’s association with the Dillards, the county and his daughters employment at ACAP allowed him unique window into its alleged mismanagement. The issue of a 26-page document authored by Dillard in January 2011–a month before the agency’s collapse, may also illuminate the nature of some the problems at ACAP and who know about them before its problems became publicly known.

An attorney for the ACAP Governing Board, who read Dillard’s “organizational assessment” of ACAP, filed an affidavit last fall saying the document made pointed remarks about ACAP staff, governing board members, other county social services agencies and third-party vendors. The attorney also testified to a passage in the document stating it was specifically written for Miley and Albany Councilman Robert Lieber, the then-chair of the governing board.

ACAP’s counsel dismissed the contents of Dillard’s assessment in court filing as a venue for her to boast over her accomplishments and “deflect blame.” It also characterized the document’s value as “largely false and unreliable.”

Categories: ACAP, Alameda County Board, Nancy O'Malley, Nanette Dillard, Nate Miley, Paul Daniels

20 replies

  1. Funny Nanette took all the credit and glory for expanding ACAP from a small organization to a million dollar organization. Yet she never planned for its long-term sustainability. Now she claims she's the victim? The victims of HER gross mismanagement were the clients of ACAP, the workers of ACAP, and Alameda County taxpayers.


  2. Damn, now I want to know what she's wrote in that document! The way things have been going on lately in this county, it's probably a love letter or a recipe for meth.


  3. Steve
    Thank you for some real reporting. I've been trying to follow this case since last year. If the board had governing authority over ACAP, and the board did not meet for almost a year, what is the DA doing about the failure of these public officers?


  4. Yes, but note that as long as Dillard was at ACAP the organization continued to function. The moment she was terminated, everything collasped. Now why is that?


  5. Thank you for this article. There are still so many questions here, but we are definitely starting to see that there is more to this than meets the eye.

    I've been involved with community action for 15 years. I am familiar with ACAP and its construct. I visited a couple of its programs, which were well-run and effective. The story as reported by the board just doesn't make any sense. If that much money was missing then Nanette would have to be in cahoots with the County Auditor/Controller, no one else would have that access. ACAP was a joint powers authority, a public agency. Their finances were controlled (badly it would seem) by the County of Alameda.

    If the Governing Board was violating the Brown Act…well, that's a big deal. Brown Act violations happen when a board is trying to cover something up or push something through without the public finding out about it. And what's up with the public records act violation? The fact that the board was trying to conceal public documents is a telling issue as well. It will be interesting to see the outcome of the whistleblower's complaint.

    It is so important to get to the real facts in this case because the outcome will effect ALL community action agencies, not just ACAP.


  6. Hey Steve,

    Your article reminded me of the several reports Chris Metinko at the Tribune wrote on this matter throughout 2011.I wanted to go back and read what he said about the county's audit of ACAP. But I couldn't access any of his archived articles on ACAP. I believe he indicated that the federal grant money for programs like ACAP transferred from the federal level, to the state level, down to the county. Alameda County was then responsible for the grant money allocation to the ACAP.


  7. Talking about joint powers agreement, how is it that the City Council of Dublin is now incharge of ACAP? Do they get the federal grant money now.


  8. It is so encouraging to see a reporter attempting to get to the truth of the matter. Normally all that is printed is misrepresentations of the truth to sell a story. I have 37 years of community action experience and over a decade of working with ACAP, as another CSD funded agency. I know Nanette Dillard as an exemplary administrator who knows the rules and follows them. The attention must be focused on the disfunctional Board and its members to determine if they should be charged with criminal intent. It was their responsibility to oversee all aspects of ACAP, especially the fiscal operations. It is time to focus the attention on Alameda County as they had the fiduciary responsibility for the agency.


  9. Paul Daniels reported to Lenita Ellis, the ACAP Deputy Director. Why is no one talking about her role? Also, there were other people working with the ACAP finances. At least 10 people at Alameda County between Social Services and the Auditor/Controller's Office. Are they being charged as well?


  10. Nanette was responsible for the day-to-day operations of the organization. She should have seen the sustainability issues along time before she wrote her letter to the board. Too little too late. At best, she's an incompetent administration. At worst, all the charges are correct and she's a bigtime crook.


  11. I've been involved with community action since its inception…that's almost 50 years. Over the decades I have seen many situations such as this one. They come up every few years across the country. I am often called in to consult. This one is text book.

    I have spent the last week reading the court documents regarding Nanette's case against ACAP and reviewing documents from the timeframe in question. During this time, ACAP had an influx of almost a million dollars in federal stimulus monies. All community action agencies received them and were under the gun to make sure that all of the monies were spent by the final deadline. In looking at reports from the State Community Services and Development Department (CSD) showing the expenditure rate of all community action agencies in the state, ACAP had not fully expended its stimulus funding by the time the board is saying illegal activities occured. In other words, ACAP was not short on funds.

    ACAP was a public entity with its finances overseen by the County of Alameda. Nanette could not have controlled the finances because it is prohibited by California Government Code 6505.5. In cases such as this one, what has usually happened is that someone inside the public entity managing the funds has made the poor decision to help itself to the funds of the community action agency whose funds it manages. The Director finds it, points it out, and then gets chucked out of their job as a result. If the County of Alameda has taken any of ACAP's stimulus funding, this is a huge issue with its own special set of whistleblowing regulations attached to it and its own federal unit to investigate. You could request these same reports from CSD showing stimulus fund expenditure over the course of the funding.

    Something to note with this situation at ACAP is that there is no mention at all of the administrative board, the Community Action Board (CAB), which is the federally required board that is to oversee the day to day administration of the agency. This is also usually a sign that the Governing Board has not properly empowered the CAB, which in turn destabilizes the organization. The CAB members are the ones with the know how it takes to keep the entity intact. Non-governmental community action agencies only have a CAB, no Governing Board at all. The large number of Brown Act violations by the Governing Board would uphold this probability. If you get a hold of the CAB minutes from 2009 through 2011 you should see what they were dealing with in regard to the organizational management.

    One thing that I found alarming in the court documents was the fact that the Governing Board had altered a public record. The first set of minutes from Feb 2 states that Supervisor Miley stated he had received a letter from ACAP staff. In the second set they changed it to reflect that several letters were received. If you get a copy of the recording of the meeting, that should tell you exactly what Supervisor Miley said and note whether it was a true correction or a political manuever. Maybe there was no letter at all.

    Finally, ACAP had a very strong reputation as far as its programs went, but it had had late financial audits for years…since the 90's I believe. During the stimulus period, CSD came down on any agency that had an issue such as this. You can request copies of ACAP's monitoring reports from CSD for 2007, 2009 and 2010. This should tell you what was going on. You could also ask for all correspondence to and from ACAP for 2009 and 2010. This will give you a large amount of information and will also tell you what the Governing Board knew and when they knew it.

    I agree with what one of the other community action people mentioned above. This situation affects every community action agency in the state. Important services to those living in poverty are at risk if all facts regarding this situation are not investigated and truthfully brought to light. Thank you for taking the time to answer the many questions that are out there.


  12. Above comments very insightful…sheds some light on the prospect that Nate Miley may also be the in cross-hairs on this matter.

    May explain why Nate is walking so lightly with regards to Nadia Lockyer.

    God forbid Nate through rocks in glass houses?


  13. By MW:

    I have not followed this particular issue closely. so for all I know concerning the allegations against Dillard and Daniels they might be the very most honest and ethical people in all of California or they could even be the most dishonest and unethical people in all of California.

    However regardless of the facts concerning Dillard and Daniels, I do know I would not trust anything stated by the Alameda County DA's office, an agency that is unusually sleazy and an extreme bunch of pathological liars even based on the “standards” of the legal profession.

    For instance, I used to have a co worker who told me that he had previously been self employed as a store owner in Alameda County. He said that while he had been a store owner, occasionally someone would walk in with a gun and hold him up. In regard to those holdups, occasionally law enforcement would catch a suspect, a suspect that sometimes the AC DA's office would prepare to take to trial.

    He said each time one or another of the attorneys for the AC DA's office would meet with him shortly before the scheduled trial to illegally script and rehearse testimony, and would always conclude the illegal scripting and rehearsing session by warning my co worker to never admit that such a session had ever taken place.

    And in the time that I myself spent as an employee of AC govt, I found that two of the major functions of the AC DA's office were: one, to protect the big boys and the politically connected, and no matter how corrupt they were and no matter hwo much they received in under the table bribes; and two, to help harass and intimidate whistleblowers.


  14. MV,

    Based on what appears to be your first hand knowledge of political corruption, I strongly suggest you contact the FBI's Political Corruption Div. promptly.

    Considering all the BS currently transpiring in Alameda County, I'm confident they would love to hear from you.


  15. As a former employee of ACAP, I witnessed Paul and Nannette's mismanagement of funds for our youth employment program. I worked with the clients on a daily basis. Nannette and Paul exploited the integrity of the program. They acted as money hungry vultures that left our program to be denied resources that were set aside for the program. They blatantly stole from our young people. Not to mention they, mistreated their employees. Nannette managed(if that's what you want to call it) with an iron fist while her hen pecked husband falsified documents and acted as a snitch when employees complained about needing more support. If you spoke out, you were fired. I hope they get what they deserve. “How could you two do this to our young people.?Your selfish acts caused a great program to be cut. SHAME ON YOU!!!!!!!
    Let justice prevail.


  16. You think this is bad someone please take a look at the monies flowing from 2nd chance and AB109. These are also extreme cases of mismanagement by Alameda County Supervisors and different boards of directors. The county needs a cleansing real bad.


  17. You think this is bad someone please take a look at the monies flowing from 2nd chance and AB109. These are also extreme cases of mismanagement by Alameda County Supervisors and different boards of directors. The county needs a cleansing real bad.


  18. Whoa! Thanks for your comment Everett! This is totally deep! The money that the Sheriffs applied for is the same money that ACAP had applied for and received from BJA. Now this all makes sense. ACAP had to be destroyed in order for lame county departments without an inch of originality or ability to take over the work that the ACAP was doing, albeit the Sheriffs would do it with much less competence.

    Here's what their application for Second Chance Act funding says and it is touting exactly the work that ACAP was handling at Santa Rita until Nate Miley decided to destroy ACAP for his own purposes including getting a hold of CSBG funding to pay for his beloved youth center in Ashland. What a loser. Miley's behind a lot of the problems in Alameda County and needs to go. He stole $308,000 from ACAP without the knowledge of the board or the staff. He just had the Alameda County finance department take it.

    And the guy mentioned at the end. Marty Neideffer, he works with that creepy little chick who was always going around saying really incendiary things about ACAP, trying to get people to believe that it was dysfunctional. It was really clear that she was the one who was dysfunctional. Seriously, she always came across as being mentally disturbed.


  19. Does anyone know who the judge in this trial is?



  1. Judge dismisses all charges against couple once blamed for fall of ACAP

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