The St. Louis-based Regional Education Advocacy Coalition on HIV/AIDS (REACH), a group focusing on AIDS education and outreach, is at risk of going under according to a city comptroller's audit of financial records of the six months preceding March 1, 2003. The city review listed a series of accounting problems including failure to file tax forms; completing an internal audit late; having one person receiving and depositing funds; carrying inadequate workers' compensation and auto insurance; and late filing of seven of nine monthly financial statements.

Many of the problems predate REACH's present leadership, when the group, then known as Blacks Assisting Blacks Against AIDS, ran into legal and financial problems after using federal money to hire a porn star to appear at a safe-sex event 20 months ago. While city officials said most of the problems disclosed in an audit last year appear resolved, there are ongoing funding problems.

The $500 in federal syphilis elimination money used to hire the porn star was later reimbursed to CDC, and the unused portion of the grant -- about $20,000 of $80,000 -- was frozen by the city Health Department. Two of REACH's three five-year CDC grants expire within a year. REACH recently had $129,000 Title I money cut by the regional planning council, which struggled to trim its case management budget. REACH has asked for $215,000 in Title I funds.

REACH's $1.1 million budget -- funded solely by grants -- could drop significantly this year. "We noted negative trends which indicate the agency may have difficulties in sustaining its current operations," reads the audit.

To make up for the shortfall, REACH will start charging a fee for some of the workshops and classes it offers. REACH Director George R. Cotton Sr., hired in April, said the group is aggressively seeking new funding sources to make it less reliant on grants.

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