🌊 How Nonprofits Profit off Migrants

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Today we deliver part two of our three-part series on the billion-dollar migrant industry. In part one, we examined how hotels have made billions off the migrant influx. In part two, we look at how contractors and nonprofits have made their billions. 

This report is part of our mission to cut through the Big News noise and spin on hot-button topics. They’ll tell you about either migrant crimes or heartbreaking mistreatment and deportations, depending on what their audiences or owners want. 

Roca’s audience seeks the truth with no agenda, and that’s what we strive to give them.

–Max Frost, editor-in-chief

By Max Towey, Roca co-founder

According to the Department of Housing and Urban Development, New York City is home to one in five homeless people in the US. 

This isn’t because it’s the largest city in the country – after all, it’s home to just one in 50 Americans – but because of policies and migration. 

New York City is one of the few American cities that has a “right-to-shelter” law, which requires the city to provide housing for anyone who requests it, regardless of citizenship or immigration status. On top of this, 220,000 impoverished migrants have arrived in the city since 2022. 

For New York City’s housing and homeless nonprofit ecosystem, this combination of policies produced the perfect storm – or opportunity. 

As the migrant influx began, homeless shelters reported widespread staffing shortages and record capacity month after month. Then the money came flowing: From 2022 to 2024, the network of nonprofit groups that run New York City’s homeless shelter saw their funding jump from $2.7B to $4B. Some of that funding went straight into the pockets of nonprofit operators.

Last fall, New York City’s Department of Investigation released a report that found widespread nepotism and corruption in the distribution of the new funds. The executives of numerous homeless nonprofits paid themselves $500,000 or more; some paid themselves over $700,000. 

That influx of taxpayer money turned sanctuary cities like New York into boomtowns for nonprofits and government contractors. 

After visiting shelters and doing interviews across the city, we identified several stories of particularly egregious abuse and mismanagement of migrant-related funds.

Everywhere we went – from the four-star Roosevelt Hotel in Midtown to a worn-down Ramada in the Bronx – we saw vans with the name “DocGo” plastered across the doors. We decided to look into it. 

In May 2023, DocGo, formerly known as Rapid Reliable Testing NY, signed a $432M contract with New York City. The deal was a broad agreement to provide migrants with Covid testing, vaccinations, and various medical services. For DocGo, this was transformative: Before the contract, the company was pulling in less than $100M in revenue annually. Furthermore, the $432M deal was a “no-bid” contract, meaning the city refused to entertain offers from DocGo competitors.

The contract imploded shortly thereafter. In June 2024, New York City’s comptroller found that DocGo had failed to deliver on key promises and charged the city for millions of dollars worth of empty hotel rooms, among other things. The city eventually ended up cutting ties with DocGo, but not before the company had pocketed $182M.

DocGo's contract was then taken over by Garner Environmental Services, a Texas-based company with ties to other firms profiting from the crisis, like fellow Texas company Cotton Commercial. Although it’s not clear what services Garner and Cotton provide, the two have collectively made $1.6B off the NYC migrant crisis, as first reported by the Albany Times Union. The state comptroller’s website notes that the state signed two separate contracts with Garner and Cotton Commercial, each for the oddly specific sum of $798,717,160.97. We should note that Garner, despite being based in Texas, donated to Kathy Hochul’s gubernatorial campaign prior to its $800M deal with NYC.

Although New York is notorious for its red tape, Hochul slashed the red tape surrounding deals like these. In July 2023, Hochul declared that many migrant-related contracts did not need approval from NYC’s comptroller. Ostensibly done to alleviate the acute crisis stemming from the migrant influx, the move enabled deals with contractors – like DocGo, Garner, and Cotton Commercial – to proceed with less scrutiny than normal.

Some of the city’s and state’s funds flowed to contractors; others to nonprofits and their executives. 

Jack Brown, for example, is the head of CORE Services Group, a nonprofit that runs homeless shelters. Since 2014, the organization has been awarded more than $800M in city contracts. As the migrant crisis escalated, Brown’s nonprofit received new funding, and, in turn, his salary skyrocketed to $1M a year. Brown also had his mother, brother, sister, and niece on his payroll.

“It’s way out of line,” said Daniel Kurtz, a lawyer and former head of the state Attorney General’s Charities Bureau. 

Years before Brown founded Core Services, he was accused of fraud by the private prison where he worked. After that, he opened a federally-funded halfway house in Brooklyn.The NYT later ran a piece about the project titled, “A Halfway House Built on Exaggerated Claims.” As head of the halfway house, he paid himself over $240,000 and employed his brother and sister. In his most recent role as president of CORE Services, the NYT reports that he’s steered $32M in contracts to for-profit businesses to which he’s connected. He’s not alone in that regard.

Numerous nonprofit operators have been accused of funneling government money to their own or friendly businesses. Victor Rivera’s homeless shelter organization, for example, amassed $274M in city funding, then steered contracts to his friends and businesses. Rivera was sentenced to more than two years in prison for his kickback scheme. His misconduct prompted the recent Department of Investigation report into misuse of migrant funds.

Throughout this, homeless New York natives reported declining service quality at the city’s shelters. One pair of homeless men in their 20s told us that the shelters had become so crowded, dangerous, and dirty that they had shifted to living in “bandos” – abandoned buildings often uninhabitable and in the outer boroughs.

If you missed part one, read it here. We’ll be back with the final part of our investigation tomorrow.

See you then.

–Max and Max

RocaNews co-founders