U. S. Rep. Frank Ballance, using a nonprofit foundation he chairs, funneled public money to a child care center owned by his mother. The business is located in a building owned by the congressman and his wife.
The payments were reported last week when the John A. Hyman Memorial Youth Foundation filed IRS forms for 1994 through 1997 several years after they were due. Since it was formed in 1985, the Hyman Foundation had never filed an IRS form 990, Return of Organization Exempt From Income Tax. Nonprofit charitable organizations that receive more than $25,000 per year are required to file the forms and make them available to the public on demand.
Carolina Journal reported earlier this year that starting in 1993, Ballance, as a state senator before being elected to Congress in 2002, was instrumental in securing about $2 million in state funds for the Hyman Foundation. Records obtained by CJ show that all the organization’s funds came from the state and that most of the money passed through the Department of Correction. The stated purpose of the funding was for substance-abuse programs.
Public records show that since 1989 Ballance’s mother, Alice Ballance, has owned Kiddie World Child Development Center in Windsor. Bertie County tax records show that Frank Ballance and his wife, Bernadine, have owned the land and building occupied by Kiddie World since 1986.
According to the reports filed with the IRS, Kiddie World received $3,000 in 1995 and $4,250 in 1997 from the Hyman Foundation, chaired by Frank Ballance since 1985. CJ‘s research indicates Ballance was solely responsible for distributing funds. A conflict of interest policy adopted by the Hyman Foundation, and on file with the Department of Correction, prohibits board members and their families from personally benefiting from the foundation’s activities.
The IRS forms also show that in 1995 Nebo Baptist Church in Murfreesboro received $8,500. In 1996 the Hyman Foundation gave $53,000 of the $175,000 it received from the state to Nebo Baptist. Nebo’s pastor, Robert Holloman, succeeded Ballance in the state Senate in 2003. His wife, Velma Holloman, is on the board of directors of the Hyman Foundation, although the foundation’s conflict of interest policy prohibits such an association.
Other organizations that received money were: Concerned Women for Justice in Louisburg, $5,000; Tri-County Unity Center in Weldon, $5,000; and Walnut Grove Baptist Church in Warrenton, $3,500.
The state auditor is investigating the finances of the Hyman Foundation. The auditor is expected to release a report soon.
Carolina Journal Exclusive Series: Frank Ballance’s Foundation
Carrington is associate publisher of Carolina Journal.