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Church at Heart of WPB Housing $candal Lost Tax-Exempt Status

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Church at Heart of WPB Housing $candal Lost Tax-Exempt Status

West Palm Beach’s Redemptive Life Fellowship church, which is under federal investigation for its handling of a financial partnership with the city of West Palm Beach, lost its tax-exempt status last year, Gossip Extra has learned.

Redemptive Life Bishop Harold Ray

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The IRS took the highly-unusual step, which could cost Bishop Harold Ray‘s church hundreds of thousands, because the church hadn’t filed the proper financial forms for three years in a row.

Meanwhile the church’s corporation, Redemptive Life Fellowship Urban Initiative, maintained its non-profit, tax-exempt status and its paperwork show the corporation ran a deficit — despite $4.7 million in public money from 2003 to 2010.

As Gossip Extra first revealed yesterday, the corporation’s partnership with the city to build homes for low-income homeowners in the crime-infested Coleman Park is being examined by the Inspector General’s office of the U.S. Department of Urban and Housing Development.

City officials say HUD has the power to bring criminal charges if need be.

The probe started in July after an audit showed alleged mishandling of $1.6 million in grants and $2.5 million in proceeds from home the sales.

The city admitted lax oversight of the HUD-funded housing program while the money may have gone to line the pockets of church board members. Bishop Ray already has been asked by the city to reimburse $141,000 that either he, or his personal corporation made from the deal with the city.

According to the 2009 non-profit filing by the church’s corporation, the latest available in records, the Urban Initiative made just $263,924 that year while its administrative expenses reached $342,114.

“It took us three years to get financial information from the church,” said Valmarie Turner, the rookie city department head who blew the whistle. “It’s been frustrating.”

Mayor Jeri Muoio and commissioners Kim Mitchell and Bill Moss have yet to return calls for comment. Despite four calls to the church and promises that Ray would call me back, he has yet to fulfill the promises.

The church’s large size and Ray’s standing in the local black community has made Redemptive Life a key supporter for those in city and county elections.

Incidentally, the church’s website went down after the scandal broke yesterday.

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