Faulty financial reporting practices by the Seneca Babcock Community Association (SBCA) have led to the Buffalo institution losing its tax-exempt status, and the resignation of its executive director. It has also led to a call by an Erie County Legislator for the New York State Attorney General to investigate further.
Brian Pilarski, who served as executive director of SBCA for the past two decades, confirmed in a message to BTPM NPR Wednesday that he has resigned as the result of his failure to properly submit the IRS forms that ensure the association’s non-profit tax-exempt status.
His letter to SBCA’s board of directors, written March 5, reads in part: “I am writing to you with a heavy heart to offer my deepest and most sincere apology for the situation that my failure to file the agency’s required annual Form 990 has placed the Seneca-Babcock Community Association, and each of you as its governing body, in today. I take full responsibility for this failure and for the stress, uncertainty, and reputational risk it has created for the organization and for the Board.
“No matter what the final outcome of this situation may be, I want to be absolutely clear about one thing: there has been no theft, no misuse of funds, and no personal gain involved. I understand that trust must be supported by transparency and verification, and I fully welcome the audits and financial reviews that will take place for the missing years. I am confident those audits will show that the agency’s finances were handled appropriately and that this issue stems from my failure in compliance, not any wrongdoing.
“However, I know that distinction does not undo the position I have placed the organization in. For that, I am profoundly sorry.”
The SBCA last submitted a Form 990 filing in 2020 for the tax year 2017. An auditing firm looking into SBCA's statement, Bonadio & Co., would not submit an opinion on the filing because it stated detailed records had not been maintained, and there was insufficient information to compete an audit.
Meanwhile, Erie County Legislator Frank Todaro is asking the New York State Attorney General to investigate SBCA’s financial reporting. In a letter to Letitia James’ office, Todaro raises concerns about the loss of their non-profit status, and whether that means they’ve since been improperly soliciting donations and accepting government grants from the county, state and federal governments.
SBCA operates a community center and provides various human and social services including education, economic, social and health related programs.
Todaro says many people whose lives were changed by the Seneca Babcock Community Center donate to the association, and he’s concerned for how the lack of non-profit status could affect private donors.
“If those funds were not appropriated correctly, the people that have been investing their donations into the Seneca Babcock Community Association are going to be liable for taxes on that money,” Todaro said. “We're talking hundreds of thousands of dollars. So that's concerning to me. I had to immediately respond, and put this letter out.”
Pilarski says the association is currently working to correct the situation, completing and filing the missing Form 990 returns, and will also submit IRS Form 1023 to request retroactive reinstatement of their tax-exempt status. The process, he told BTPM, could take six to eight months.
"The Seneca-Babcock Community Association has long served an important role in the City of Buffalo, and I sincerely hope that the corrective steps now underway will allow the organization to restore its status and continue its work in the community," Pilarski wrote.
