City of Palm Springs investigating alleged ‘misappropriation of funds’ for Universal Basic Income Pilot Program

Hundreds of thousands of dollars allocated for the Palm Springs Universal Basic Income Pilot Program are allegedly unaccounted for. Now, residents who relied on this program are looking for answers.

One of the program's recipients is Wren Grey. Grey, who previously experienced homelessness, says this funding saved his life.

"Without assistance, if I go back out on those streets I would die," said Grey. They discovered the program after getting referred to Queerworks by the LGBT Center. Queerworks is a non-profit that claims to offer free mental health services to transgender and gender diverse individuals. There, Grey met Queerworks CEO Jacob Rostovsky, who told Grey about the UBI Pilot Program.

The pilot program promised to provide $800 a month to fourteen low-income residents between March of 2023, and April of 2025. The $200,000 funding was approved by the Palm Springs City Council, and was paid for by using part of a $35,000,000 state grant.

“I thought 'wow, I'm very lucky, I would love to be a part of this program,'” said Grey. Grey says Queerworks helped him find temporary housing in hotels for about a month, until he was eventually transitioned into permanent housing in April. Queerworks helped pay for the security deposit before move-in. But in May, Grey says the check never came.

"I didn’t see anything, so I asked my case manager saying 'hey, I dont want to be nosy here but what's happening with the program,'" said Grey. "At the time we didn’t know anything shady was going on.”

Grey says he continued sending emails to Rostovsky and Queerworks, but only received an automated response that Rostovsky was out of the office.

"When time came and it was late June, I couldn't get a hold of him or my case manager," said Grey. "It was complete radio silence for a while.”

The missing payment prompted the city of Palm Springs to open an investigation.

Queerworks and DAP Health were the two organizations appointed to co-run the program, but according to the City of Palm Springs, Rostovsky is the only involved party being looked into.

In a full statement sent to News Channel Three, the city said:

“When the City of Palm Springs learned that Mr. Rostovsky allegedly misappropriated funds allocated for the Queerworks program, the City Manager directed the City Attorney and senior staff to aggressively investigate the funding and perform a full audit of how it was distributed and if the funds were fulfilling the intent of the program as promised. When preliminary reports revealed that the CEO of Queerworks could not provide sufficient evidence of where the funding went, the City Manager immediately directed the City Attorney to reach out and demand that any remaining funding be returned to the City. The City of Palm Springs recognizes that as stewards of taxpayer funds, it is of critical importance that steps are taken to ensure these dollars are spent responsibly and in alignment with the expectations of our community.

Review of this program has underscored the necessity for strengthened measures to enhance financial oversight and protocols related to these kinds of collaborations with nonprofit programs that provide much needed community assistance. The City has implemented updated measures to ensure something like this does not happen again.

The City of Palm Springs is pleased that DAP Health will continue to administer this program at no additional cost to the taxpayers. As it relates to any criminal investigation regarding this matter, please reach out to the Riverside County District Attorney’s Office.”

City of Palm Springs

News Channel Three also reached out to the Riverside County DA's Office about the possible investigation, and they sent back a statement saying:

“We cannot confirm or deny whether our office has received a complaint to investigate this matter. At this time, we do not have any information or details to share.”

District Attorney's Office, County of Riverside

For now, DAP Health has been appointed to take over the entire program going forward. A press release sent out on July 19th confirmed the transition:

In a joint decision by the city of Palm Springs, Queerworks, and DAP Health, the latter has proudly stepped forward to take over the administration of the Universal Basic Income (UBI) pilot program, effective July 12, 2024. The program has been part of a larger effort by Queer Works, DAP Health, and the city of Palm Springs to address the economic and social challenges facing low-income individuals and families in Palm Springs. The UBI program began in March 2023, and currently provides a monthly assistance payment of $800 to 14 low-income individuals and/or families. The program will conclude on April 15, 2025. DAP Health Chief Transformation Officer C.J. Tobe will lead the effort going forward. His focus will include:

• Communicating directly with the UBI participants, ensuring program access and
  compliance.
• Ensuring each program participant receives case management and other support
  services, as needed.
• Partnering with researchers to report on outcomes.
  “Consistent with DAP Health’s 40-year history of protecting and expanding access to
  care not only for members of the LGBTQ+ community but for all people,” says CEO
  David Brinkman, “DAP Health is proud to assume this role so that there is no disruption
  to the participants of this Universal Basic Income pilot program.”

DAP Health

Now, Grey says he's been transferred to the County's Income Assistance Program, but he still feels like he is stuck in limbo looking for answers.

"I’m hoping I can get some compassion from the County and that I'll be able to continue trucking on, because really I don't need that much money, just enough to live," said Grey.

When asked if he had any message for Rostovsky, Grey said he did.

"I will always be grateful for your help, but I'm disappointed in you man," said Grey. "I mean I really hate that all this happened, because it's a really bad look on the transgender community to have someone who is this big face of charity to be effectively stealing. It's not great.”