George Hinton ousted as SDC chief executive officer after misallocation of funds

George Hinton, the beleaguered chief executive officer of the Social Development Commission , resigned under pressure Thursday night.

"The board asked for and received the CEO’s resignation," said William Sulton, SDC's attorney, following a three-hour closed-door SDC board meeting. "The board is planning a strategy to address the consequences from those leadership failures."

The SDC board unanimously agreed to oust Hinton, effective immediately. The board came into the closed-door session knowing Hinton's employment with SDC was coming to an end.

"It wasn't so much of a debate as it was a discussion about how SDC is going to execute a succession plan," Sulton said.

The resignation comes after a series of missteps including the misallocation of more than $100,000 in taxpayer funds resulting in the closure of the weatherization program, layoffs of 28 employees and the termination of the finance director. As a result, the agency failed to pay 19 employees on April 15, said Sulton.

Sulton said the agency does not suspect foul play regarding the misallocation.

Pamela Johnson, director of human resources, will serve as the interim chief executive officer. Johnson has worked for SDC for more than a decade.

SDC is an anti-poverty agency that oversees about 30 programs and has about 90 employees, down from approximately 400 employees in 2010. It has a $30.5 million operating budget.

The struggling agency has a history of controversies going back more than a decade.

The latest financial snafu came to light last month when Hinton released a letter acknowledging the agency had "misallocated" taxpayer money from its weatherization program, which has a $6.7 million budget. The state Department of Administration is conducting a forensic audit that it hopes will uncover the total amount of money that was misallocated. Sulton estimated the misallocation amount exceeds $100,000.

Contractors and vendors have complained they were owed tens of thousands of dollars for work related to the weatherization program. One contractor told the Journal Sentinel SDC owes her $95,000.

Hinton, who was hired in 2013 , left the SDC headquarters on North Avenue shortly after learning that the board called for his resignation. Hinton was paid $218,532 in 2022, according to IRS records. He did not respond to the Journal Sentinel's phone calls and emails for comment.

Last week, Hinton terminated Patrick Kirsenlohr, SDC finance director, for misallocating the funds from the weatherization program, according to Sulton. Kirsenlohr didn't respond to the Journal Sentinel's call for comment.

Sulton explained that Kirsenlohr used money earmarked for the weatherization program in other SDC programs and services, which violates the conditions of the state grant.

"Contrary to common sense, there's no rule of financing or school of thought that believes that's appropriate," Sulton said.

As for the 19 employees who had a payless payday this week, Sulton said the agency wanted to ensure the lower paid workers are taken care of first. The agency hopes to pay all the employees by April 30.

"It is the number one priority for this organization is making sure that those folks get compensated," Sulton said.

Gina Lee Castro can be reached at gcastro@gannett.com . Cary Spivak can be reached at 414-550-0070 or cspivak@jrn.com .

This article originally appeared on Milwaukee Journal Sentinel: George Hinton ousted as SDC chief executive officer after misallocation of funds