Modesto City Council members gave formal approval Tuesday to new guidelines for continuing Modesto's Neighborhood Stabilization Program. But they took $178,000 away from the beleaguered nonprofit agency Stanislaus Community Assistance Project.

About 24 hours after board votes were taken to dissolve the Stanislaus Community Assistance Project and start looking for another local nonprofit to take it over, the Modesto agency's directors reversed course.

Greed, mismanagement and questionable financial practices are so severe at the Stanislaus Community Assistance Project that its board of directors voted Wednesday night to disband the agency.

• 1999: The nonprofit Stanislaus Community AIDS Project changes its name to the Stanislaus Community Assistance Project, a move to broaden the group's focus beyond the human immunodeficiency virus and AIDS. Starting in the 1980s, the original group provided education, services and emotional support to AIDS patients and their families.

The Stanislaus Community Assistance Project is expected to repay $80,000 in rental income collected from employees or their family members who lived in the housing paid for by Modesto's Neighborhood Stabilization Program, officials said.

It took more than three weeks and a trip to Washington, D.C., to get it, but Modesto Mayor Jim Ridenour said he received written confirmation Thursday about what auditors found during their review of Modesto's housing program.

Neighborhood Stabilization Program consultants Cynthia Shallit and Jamie McLeod discontinued their contract with the city, as of Wednesday. City Manager Greg Nyhoff said the consultants decided to break off the relationship when he talked with them about shifting their focus to economic development, golf course contracts and John Thurman Field.

Major changes to Modesto's Neighborhood Stabilization Program will be proposed during a special City Council study session from 3 to 6 p.m. today.

In an effort to stabilize the city's real estate market, a federal stimulus program has spent nearly $1.5 million on eight Modesto homes that ended up being worth less than $1 million.

Modesto leaders today could resume spending federal dollars in the city's Neighborhood Stabilization Program with the $61,000 purchase of a duplex for homeless young adults.

The city of Modesto insisted a HUD audit shows "no ineligible or undocumented expenditure" of federal Neighborhood Stabilization Program funds by the Stanislaus Community Assistance Project. But confusing wording in the report and a HUD explanation of what that wording means calls into doubt if the audit reviewed controversial SCAP expenditures.

Take trashed foreclosure homes and fix them up again to sell or rent to people in need. Done properly, it rebuilds neighborhoods and makes them safer. But as often happens whenever the government hands out money, the wrong hands turn palms up.

Key developments in the controversy over the Neighborhood Stabilization Program in Modesto, which has received about $36 million in federal dollars in three phases to buy and fix foreclosed residential properties:

The Stanislaus Community Assistance Project has fired its Executive Director Denise Gibbs and her husband Joe Gibbs, SCAP's director of business and development.

A troubled Modesto nonprofit under investigation for its use of millions of dollars in federal housing money was awarded nearly $500,000 more this week.

Two consultants are working on a restart of Modesto's Neighborhood Stabilization Program next year. They have spent 10 days getting acquainted with the difficulties of moving forward with the remaining $12 million in federal money.

A husband and wife under fire for their management of a Modesto nonprofit agency have settled a lawsuit brought by the family of a man killed when he was hit by the couple's car three years ago. Joe and Denise Gibbs faced a wrongful death civil lawsuit; their trial was scheduled to start earlier this month.

As two consultants start to work on Modesto's Neighborhood Stabilization Program later this month, an immediate concern will be the 27 homes that developers remodeled for resale. They will try to revamp a $33 million neighborhood stabilization effort that was suspended in August over myriad concerns.

In a response to a critical review from City Hall, the Stanislaus Community Assistance Project agreed with many of the city's concerns about its management of housing and asked for more time to make corrections.

The deputy parks and recreation director who managed Modesto's troubled Neighborhood Stabilization Program has resigned. Judith Ray, a 30-year city employee, submitted her resignation Thursday, a day after a City Council vote to hire consultants who will take over management of the federally funded housing program.

A husband and wife who have been criticized for how they have run a Modesto housing nonprofit are scheduled to appear in Stanislaus County Superior Court next week in an unrelated civil lawsuit.

A leader overseeing a Modesto nonprofit housing agency said Monday its board will not consider making personnel changes at a meeting this week.

Modesto officials are taking action against a nonprofit housing agency that received more than $8 million of taxpayer money to buy and rehabilitate foreclosed properties, then placed employees or their family members in the homes.

City leaders will consider a $214,000 contract with an outside firm to manage Modesto's Neighborhood Stabilization Program and economic development programs as well as advise the city on reorganizing certain operations.

Modesto leaders took another step Tuesday toward trimming the city's pension costs by approving reduced benefits for newly hired employees.

City officials don't expect to see the results of an all-important federal audit of Modesto's Neighborhood Stabilization Program until after the Nov. 8 election. Mayor Jim Ridenour said Friday that federal officials gave him a time frame of late November to early December for completing the audit of money spent renovating foreclosed homes.

A Republican Party flier decorated with a Halloween theme has sent a chill through five candidates running for the Modesto school board and City Council who were targeted.

A Modesto nonprofit reported that several appliances were stolen from a remodeled home that has been a focal point of controversy over the city's Neighborhood Stabilization Program.

Modesto's next mayor will deal with revenue shortfalls, employee compensation, growth boundaries and high unemployment, besides the routine responsibilities of the city's top elective office. There are clear differences among the four candidates.

The City Council race in northwest Modesto is a low-profile one involving two men who put job creation at the top of their agendas. The District 1 election pits John Gunderson, a substitute teacher, against Philip Moyer, a security guard.

Maryn Pitt is in the market for the worst homes in town. Pitt, the city's Housing Program Services manager, runs the Neighborhood Stabilization Program, which buys and rehabilitates homes, then sells them to low-income residents with low-interest loans. She gave a report on the program to the City Council last week.

A Stanislaus County Superior Court judge has denied a motion for a change of venue for Joe and Denise Gibbs, who claimed negative publicity about their nonprofit — SCAP — would prevent them from receiving a fair trial.

Candidates for a Modesto City Council seat wasted no time trashing each other in a lively debate Tuesday, the first this campaign season in the Stanislaus League of Women Voters' 62-year tradition.

Attorneys argued in court Thursday over a motion to move a wrongful death civil lawsuit to another county after the defendants claimed bad publicity involving their nonprofit, the Stanislaus Community Assistance Project, will prevent them from receiving a fair trial.

At the depths of the foreclosure crisis two years ago, federal stimulus funds began pouring into Stanislaus County to supposedly stabilize neighborhoods. But how those federal funds were spent, and what became of the properties purchased with taxpayer dollars, varied dramatically.

A group of nonprofits, government agencies and faith-based groups that help the homeless has formed a committee to investigate the anonymous allegations lodged against its executive committee.

A Modesto nonprofit has hired what it calls a "nationally recognized ethics leader and an expert in transparency" to help sort out its conflict-of-interest problems. The Stanislaus Community Assistance Project's board of directors announced Wednesday that it had hired the San Jose men to bolster SCAP's ethics and transparency policies.

A group of nonprofits, government agencies and faith-based groups dedicated to helping the homeless has been accused of wrongdoing by one of its members.

Joe and Denise Gibbs think they and their nonprofit, the Stanislaus Community Assistance Project, have gotten so much bad publicity that a wrongful death civil lawsuit against them should be moved to another county.

Two Modesto charities controlled by Denise and Joe Gibbs purchased foreclosed homes at a deep discount from banks, then transferred them for no profit to two local real estate agents who could pocket tens of thousands of dollars on the deals.

The Modesto City Council's watchdog apparently won't dig any deeper into the controversy over the Stanislaus Community Assistance Project. City officials said they want a more thorough audit of how the federal funding was spent in the first two phases of the program.

As federal investigators audit how Modesto spent $25 million in stimulus money, they are likely to find extravagant purchases, suspiciously high expenses, allegations of shoddy workmanship and at least one home sold at a deep discount to a city employee.

City Hall records shed more light on the luxuries that a nonprofit housing developer installed in Neighborhood Stabilization homes in Modesto — all at taxpayer expense.

There are many layers to the controversy involving the Stanislaus Community Assistance Project. And now, there's another. After being convicted of misdemeanor vehicular manslaughter and felony hit-and-run in the death of a father of two, the organization's grant writer, Joe Gibbs, served only home detention.

Modesto received $25 million in federal money from the second phase of the Neighborhood Stabilization Program and spent slightly more than half of it in two years revamping foreclosed homes. But city officials will await the outcome of several audits and an FBI investigation before deciding whether to spend the remaining $12 million.

The folks at Oakdale's Laurel Crest rest home can rest a bit easier for the time being. Wells Fargo postponed the sale of the property, spokeswoman Julie Campbell confirmed, declining to provide any specifics.

Several investigations are ongoing, but it's not clear what will happen next in the controversy over how a Modesto nonprofit agency spent millions in federal stimulus money. Modesto city officials are awaiting the results from a just-launched audit of the Stanislaus Community Assistance Project.

Questions are being raised over whether a Modesto nonprofit agency used taxpayer money to drastically overpay for an apartment complex that ended up needing major repairs. The city of Modesto financed the $1.5 million deal without first inspecting the property.

Bee editorial: Modesto leaders share blame in SCAP fiasco

The housing director for a Modesto nonprofit agency recently has lived in two homes that were purchased and renovated through the city's Neighborhood Stabilization Program, and two of her family members occupy homes in the program.

A federal official released a statement Tuesday suggesting that a Modesto nonprofit agency violated conflict-of-interest rules by allowing family members of employees to live in homes paid for with government money.

A troubled nonprofit agency has turned over some records requested by the city and agreed to cooperate with an audit of its federally funded housing projects, a Modesto official said Thursday.

Board members have quit, administrators won't answer questions and government officials are being denied access to records at a government-funded Modesto nonprofit agency. Who now has control of the Stanislaus Community Assistance Project — and the more than $20 million in taxpayer funds it has received — isn't known.

There's always an old movie plot that mirrors something happening in real life. Consider the Stanislaus Community Assistance Project, which might very well be the most profitable nonprofit this area has ever encountered.

A Modesto nonprofit agency is under investigation for allowing staff and family members to live in government-subsidized homes rather than the disadvantaged people the properties were intended to help. The Stanislaus Community Assistant Project has received $8.34 million in federal funds to buy and renovate 21 foreclosed Modesto housing units, including an apartment complex.

The city of Modesto has notified the Stanislaus Community Assistance Project that it will not distribute any more Community Development Block Grant and federal Neighborhood Stabilization Program funds to the organization until an audit has been completed.

Modesto's blue-ribbon committee on the homeless is talking about stricter rules for people living on the streets and the charities that help them, including restrictions on feeding programs, using safety officers to patrol city parks and advising the public not to give money to panhandlers.

The United Way has cut off funding to the Stanislaus Community Assistance Project, citing concerns over that nonprofit agency's "lack of cooperation and transparency." SCAP's compensation deal with Joe Gibbs triggered the United Way's unusual action, according to United Way Chief Executive Officer Francine DiCiano.

In a statement released Friday, William Joe Gibbs said he has chosen to forgo $436,471 in compensation that was owed to him by the Stanislaus Community Assistance Project.

Opinions are mixed over what Modesto officials should do regarding a nonprofit agency giving one of its staff members more than $627,000 as an "incentive" for landing government grants.

Big-buck salaries are not common for Modesto's nonprofit executives, despite what one of the city's housing agencies pays. Professional fund-raisers and nonprofit leaders expressed concern Tuesday about how much William Joe Gibbs earned at SCAP.

Leaders of an embattled Modesto housing agency have named a new executive director, will change the organization’s name and plan to move the nonprofit to a new location next month. The Stanislaus Community Assistance Project will change its name to Community Impact Central Valley, representatives said Monday.

The long-awaited federal audit of Modesto's $25 million Neighborhood Stabilization Program determined the city spent nearly $100,000 on ineligible expenditures — including improper real estate commissions and management fees.

The Stanislaus Community Assistance Project of Modesto informed public agencies and other nonprofit groups that three suspended managers can no longer conduct business on behalf of SCAP.

The FBI confirmed that it served search warrants this morning at the home of Denise and Joe Gibbs, the suspended executives of a Modesto nonprofit that has received millions of dollars in federal housing money.

The husband-wife team of Denise and Joe Gibbs, leaders of the embattled Stanislaus County Assistance Project, have been suspended, the Modesto nonprofit announced today. Also suspended was housing director Carol Prunty.

At the get-go, Modesto city officials pooh-pooh'd concerns raised by The Modesto Bee over how the Stanislaus Community Assistance Project spent federal money intended to help low-income and underserved citizens.

Two nationally recognized ethics leaders recommend that a controversial Modesto nonprofit agency take “strong and decisive actions” to implement “real changes and reform.”

Modesto City Councilman Joe Muratore and his business associates are in hot water over their involvement in a federally funded housing program. At Wednesday's council meeting, Mayor Jim Ridenour said federal inspectors and city staff had determined that a sales commission paid to Muratore's real estate firm violated the conflict of interest rules of the NSP.

A government-funded nonprofit agency has proved profitable for the Modesto couple that runs it. Joe and Denise Gibbs earned more than $1.32 million in four years working for the Stanislaus Community Assistance Project. A federal investigation has been launched into how the city of Modesto spent federal tax dollars.