Controller Places Urban Alchemy on Watchlist for Financial Concerns

City oversight office flags "serious fiscal" issues at major street safety contractor, demanding accountability for public funds.

The Facts

San Francisco's Controller's Office has placed the nonprofit Urban Alchemy on a corrective action watchlist after identifying what the office called "serious fiscal or programmatic" issues, according to a report by Gabe Greschler at The Standard. An August 21 letter to the organization flagged inadequate employee time-tracking systems spanning two years and significant cash flow problems.

The Context

The Controller's Office City Services Auditor provides independent assessment of the City's $15.9 billion budget and oversees nonprofit contractors through its monitoring program. Urban Alchemy, one of the most visible, deploys formerly incarcerated "practitioners" to provide safety services in areas like the Tenderloin. The organization's revenue grew from $10 million in 2020 to $70 million in 2023. Warning signs emerged in late 2024 when the organization exceeded its budget by $500,000 in one month, leading some supervisors to question its financial management.

Despite these administrative challenges, Urban Alchemy has provided critical street-level services, including overdose prevention and naloxone distribution that have helped save lives in the Tenderloin and other high-risk areas. The watchlist requires the nonprofit to develop and implement a corrective action plan to resolve the identified issues.

The GrowSF Take

This Controller action demonstrates exactly the kind of rigorous financial oversight taxpayers deserve. When nonprofits receive substantial public contracts, they must be held to the highest standards of transparency and performance. The watchlist designation is not a punishment but a critical tool of good governance, showing that accountability mechanisms are working to protect public investment while giving organizations a clear path to fix their problems. This is pragmatic, effective governance in action.