03/19/2014 01:35 EDT | Updated 05/19/2014 05:59 EDT

Portland Hotel Society Board Resigns Over Spending Concerns


VANCOUVER - The board and senior managers of Vancouver's groundbreaking safe injection site have resigned amid concerns over spending by the group behind the initiative.

Mark Townsend, executive director for the non-profit Portland Hotel Society, said the provincial government presented an ultimatum demanding senior officials step aside or risk the loss of funding and contracts.

Townsend said Wednesday that rather than jeopardize programs, he and the others will leave their posts by the end of the month.

"The commitment is that no programs are shutting," he said.

The society spearheads housing programs, dental and health clinics and other outreach services, but it's most notable for operating Insite, North America's only safe injection site.

The province hired an independent accounting firm to check the society's books last fall after B.C. Housing, which oversees the society, found irregularities in spending.

Housing Minister Rich Coleman said earlier this month that two audits were been done after significant concerns were raised about how the society manages taxpayers' money.

"The options are: Can you manage better, can you explain some of the uses of money?" he said.

"The concerns are about management of money, what it's spent on."

Questions about the society's operations arose during routine audits conducted every three years, Coleman said.

"We saw some flags so we brought in an outside auditor to audit both sets of programs, both from a health perspective and a housing perspective," he said. "We've identified some significant concerns that we want fixed and we'll find ways to get them fixed."

Coleman said he couldn't provide details about the audits, which are expected to be released publicly Thursday.

The Portland Hotel Society has 17 government contracts worth $8.5 million annually.

Besides Insite, which opened in 2003, it manages an interim detox area called Onsite. The society also runs a catering service and social housing suites in hotels with health care services for mentally ill or drug-addicted clients.

While the society provides counselling and day-to-day operational services at Insite, staff such as nurses are on contract with Vancouver Coastal Health, one of five provincial health authorities.

Insite allows addicts to shoot up their own drugs in one of 12 booths to prevent overdoses. The addicts are also given clean needles to stop the spread of infectious diseases such as HIV.

The society and several drug users won a series of legal battles with the federal government, which wanted the facility shut down over concerns that it promoted drug use.

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