The state has dropped its efforts to shut down a trailblazing gay youth agency after reaching a settlement in which the organization admits to some "inappropriate sexual conduct" involving teenagers in its care and agrees to strip its founder of day-to-day oversight duties.
The settlement was reached as the state began to present its evidence against Gay and Lesbian Adolescent Social Services at a Los Angeles hearing last week, and was finalized Friday.
"This is consistent with the way we approach many of our administrative action cases," said Dave Dodds, spokesman for the California Department of Social Services. "First of all, we are satisfied that . . . in the document we signed we have a recognition that there was inappropriate sexual contact between children and staff and/or volunteers."
Additionally, Dodds said, "It sets up the framework we believe ensures the health and safety of the children. It does not exonerate [the agency] from what happened in the past."
Agency officials, who have vigorously fought the allegations, put the settlement in a much different light.
"This is a settlement the state offered us to save face," said Dr. Richard L. Wulfsberg, president of the agency's board. "My view is we would have liked to go to trial. But the state knows it would cost $3,000 a day and the proposed length of the trial is three months. So it doesn't take a rocket scientist to realize you would have a victory but no agency left."
The agency and Teresa DeCrescenzo, the agency's founder and executive director, do not admit any of the specific allegations made by the social services department in an accusation filed earlier this year.
But the agency does acknowledge in the 16-page settlement order that agency youth and/or adults associated with the agency engaged in inappropriate sexual conduct with youth under the agency's care, and that on more than one occasion the agency had information about such conduct and failed to take appropriate action to protect the children.
DeCrescenzo, who had been barred from any involvement with the agency under the original state accusation, will be allowed to continue with the agency in a limited role. She can serve on the board and as planning chief, engaging in fund-raising, advocacy and development.
But the settlement stipulates that she cannot be involved in the day-to-day operation of the agency, supervise staff or even go to the agency's group homes, except to attend social functions or conduct tours for donors. And general oversight of the agency is put in the hands of the board's executive committee, from which DeCrescenzo's close allies are excluded.
Agency attorneys and DeCrescenzo could not be reached for comment Monday.
Although the agreement brings to a close the case against the agency, the settlement does not include several staff members accused of sexual misconduct. Among them is Bernard La Fianza Jr., the agency's finance director, whom the state has barred from working for the agency or any other state licensed care facility. He has adamantly denied the allegations and his case is being reviewed by a state administrative law judge.
The state moved against the agency in March, when it capped a long investigation by filing a broad range of allegations against the agency, which runs five group homes for troubled or neglected gay youth, as well as three foster family agencies.
Seeking to revoke the agency's license, the social services department contended that staff and volunteers had engaged in sex with teenagers living in the group homes, that the agency had failed to report some suspected abuse and had failed to adequately supervise the youngsters in its care.
Described as the only agency of its kind in the nation, it fiercely contested the accusation, branding it a state witch hunt built on lies.
Under the settlement, the agency will remain on five years' probation. If the agency successfully completes probation, the conditions imposed on agency and DeCrescenzo will be lifted.
Michael Ludin, a former donor who set in motion the state's investigation of the agency two years ago, said he was pleased the organization has survived.
"I am glad the agency is going to continue to do the good things it set out to do," Ludin said. "And I hope they're able to steer clear of any impropriety that has been part of their history."