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Two Dead, Canceled Contracts and Abrupt Board Resignation from Exodus CEO

Julio Medina quietly resigned his role on the panel that oversees city jails, THE CITY has learned, as his group that provides post-incarceration services faces new scrutiny.

SHARE Two Dead, Canceled Contracts and Abrupt Board Resignation from Exodus CEO

Exodus CEO Julio Medina speaks at a Board of Correction meeting.

Screengrab/NYC Board of Correction/YouTube

The CEO of Exodus Transitional Community — a nonprofit facing investigations on several fronts — has suddenly resigned his position on the Board of Correction, the panel that regulates and oversees city jails.

Julio Medina notified the board he was stepping down just one year into his six-year term. He was originally appointed to the board by the City Council in Sept. 2021 and until now served as its acting chair.

Medina formally resigned in a letter sent Nov. 15 to Mayor Adams, Council and court officials, writing, “Serving the city in this capacity has been a truly humbling and rewarding experience, at times testing my faith in humanity but ultimately strengthening my commitment to helping incarcerated New Yorkers” as the head of Exodus.

Through a spokesperson, Medina declined to provide THE CITY with an explanation for his sudden and unexpected decision.

THE CITY has learned that his resignation from BOC comes as City Hall recently notified Exodus that it was turning over the hotel program to another provider and that Exodus’ role would terminate as of Jan. 1.

All of this is occurring as Exodus has come under scrutiny from multiple oversight entities, starting with a city Department of Investigation inquiry into its use of an unlicensed firm to provide security at hotels where, under a city contract, it placed released inmates during the pandemic.

After starting with an $835,000 agreement, the Mayor’s Office of Criminal Justice (MOCJ) expanded the deal to an ultimate $121 million. And THE CITY has learned that with MOCJ’s approval, Exodus began housing some of its own employees in the taxpayer-funded hotel rooms, including two who died there.

The city Department of Correction canceled a separate $5 million contract with the group last month after allegations surfaced about misconduct by several Exodus employees working inside Rikers, including smuggling drugs to inmates. 

And THE CITY has learned that two more inquiries are underway.

The state is looking into allegations that an Exodus caseworker had been regularly putting in paperwork to bill Medicaid for dozens of sessions with clients that never occurred. The employee was fired and the Office of Addiction Services and Supports (OASAS) was notified “immediately,” according to Josh Vlasto, a spokesperson for Exodus. A spokesperson for OASAS declined to discuss the referral.

And in June, Exodus stopped paying Presidential Security, the company that took over for the unlicensed security firm exposed by THE CITY, leaving Presidential and dozens of its employees high and dry. Several of these workers told THE CITY they had been interviewed by the state Department of Labor about the stopped payments.

Asked about Exodus’ referral to the department, an agency spokesperson responded via email, “The New York State Department of Labor does not comment (confirm nor deny) on potential or pending investigations.”

The biggest change took place behind the scenes early this month when MOCJ notified Exodus that the hotel program would be turned over to another nonprofit, Housing Works, starting Jan. 1. Exodus had been negotiating over the last several months to continue running the program into next year.

In an internal email to Exodus staff in September, a leader wrote the group “has been engaging with multiple City agencies to explore options that would allow us to continue offering housing to justice impacted New Yorkers.” Those conversations “seem to be taking a positive tone.”

By Nov. 3, the optimism was gone. “We are heartbroken to share that we have officially learned that after 12/31/2022 the city will no longer partner with Exodus in our hotel program but will continue (in some capacity) with another provider.”

A hotel in Fresh Meadows, Queens, was being used to house former inmates, March 2, 2022.

Ben Fractenberg/THE CITY

Jonah Allon, a spokesperson for Mayor Eric Adams confirmed the switch in an email to THE CITY. Allon said that the number of inmates in hotels run by Exodus had already dropped from 800 to 600, and the number of hotels dropped from six to four, but that going forward, Exodus is out.

“Starting in January of next year, Housing Works will operate the remaining emergency hotels,” he wrote. “Mayor Adams remains committed to ensuring that all New Yorkers, including those returning from incarceration, have the support and services they need, including more permanent sustainable housing. As we wind down the emergency hotels program and expand the transitional housing program, it is critical to ensure continuity for program participants, especially amid the ongoing disruptions caused by the pandemic.”

Meteoric Expansion

The meteoric expansion of Exodus’ work during the pandemic has triggered chaos and financial uncertainty within the group.

Twice since August, Exodus employees have been forced to temporarily skip their weekly paychecks, according to several sources familiar with the internal struggles there. The group’s most recent contract extension started July 1, but was not sent to city Comptroller Brad Lander for registration until Oct. 27. Lander registered it a week later. Allon would not say what caused the four-month delay.

In a statement, Medina blamed the delays in payments on MOCJ and defended his group’s actions: 

“For over twenty-three years, Exodus has been on the front lines to protect New York City’s most vulnerable populations and support the successful reentry into society of justice-involved individuals, particularly those on Rikers Island. This is incredibly challenging work in difficult environments and unfortunately, mistakes and missteps can occur.”

Addressing the group’s work placing released inmates in hotels at the request of City Hall, Medina stated, “When COVID-19 shut down the city, Exodus answered the call and rapidly scaled our operations at the request of the City to meet the significant and urgent needs of the vulnerable people we serve. Any issues of fraud, waste, or abuse have been and will continue to be reported to the appropriate agencies and authorities.”

Medina is a convicted drug dealer who formed Exodus, after serving 12 years in prison, to help ex-offenders find jobs and get back on their feet upon release. The idea: hire formerly incarcerated individuals to work with people released from prison, on the premise that their experiences behind bars would enhance their ability to connect with those they’re trying to help. The model caught on, and the program expanded.

For years Exodus grew at a modest pace, obtaining government contracts from city and state agencies. Soon Medina gained national attention, attending the 2004 State of the Union address at the invitation of President George W. Bush.

And then came the pandemic. When the virus struck in the spring of 2020, then-Mayor Bill de Blasio’s criminal justice office — without seeking input from any other group — picked Exodus to handle services for inmates released from incarceration and placed by the city in hotels to help stem the spread of the virus.

Staff Died in Hotel Rooms

As the citywide pandemic emergency response expanded, Exodus’ role did too. Behind the scenes, the group worked with City Hall to change the terms of its agreement and began granting its own employees free residence in rooms at the same hotels where it was placing released inmates — all at taxpayers’ expense.

Exodus’ contract with the Mayor’s Office stated that only an individual who is “experiencing homelessness or is at risk of imminent homelessness and has been recently released from incarceration (within six months preceding referral)” was eligible for a paid-for room. 

Exodus got around this by obtaining waivers from MOCJ that allowed their own staff to move into these rooms, too. In his statement to THE CITY, Medina noted that some of the staffers in hotels were recently released from prison, while others were graduates of Exodus’ workforce development program.

All told, Medina said “less than 10” Exodus workers were staying in the hotels, “and all are looking for permanent housing.”

“Relevant hotel stakeholders, including MOCJ, were made aware of this information and found the practice acceptable with specific parameters,” Medina stated.

That included two Exodus staffers who passed away while staying in these rooms, THE CITY has learned.

In May, a cook and secretary for Exodus who was living at the Tillary Hotel in downtown Brooklyn died of an accidental overdose of heroin and fentanyl, according to the findings of the city’s medical examiner.

Then in September, one of Exodus’ top executives committed suicide by hanging in another Exodus hotel, the Mayflower in Fresh Meadows, Queens, the medical examiner found.

Medina said MOCJ was “immediately” notified of these two incidents. “These were beloved members of our community who were committed to our mission of helping justice-involved New Yorkers rebuild their lives with love,” he said.

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