Why Should Delaware Care?
Youth services for hundreds of New Castle County children face uncertainty as finances at the Police Athletic League of Delaware are probed. The nonprofit is one of dozens of private organizations that are regularly funded by taxpayers. For years, it also was one of a handful to be led by a state lawmaker.
The financial crisis facing the Police Athletic League of Delaware escalated in recent weeks after state officials demanded that the community center nonprofit repay nearly $900,000 in misspent pandemic relief money, New Castle County police chief Col. Jamie Leonard said Tuesday.
Speaking before the New Castle County Council, Leonard said the PAL — as the organization is known — does not have enough cash on hand to repay the money, which he said was awarded for capital projects in previous years, but instead was spent on day-to-day operating expenses.
Leonard said state officials are expecting the repayment “rather quickly,” because they want to redistribute the dollars before a spending deadline at the end of the year.
He also indicated the situation could involve criminal liability, but said it remains “difficult to unravel.”
“Financial crimes was never my thing, but it’s messy, for sure,” he said to the council.
A spokesperson for the Delaware Department of Finance declined to confirm that it is demanding repayment, stating “we do not comment on active investigations.”
The office of the U.S. Attorney for Delaware did not respond to an email seeking comment.
The police chief’s comments mark the latest chapter in the troubles facing the politically connected nonprofit, which operates community centers serving children in New Castle County. They first emerged publicly eight months ago after former Delaware House Speaker Valerie Longhurst quietly resigned as the executive director of the nonprofit.
At the time, two board members told Spotlight Delaware that the organization’s cash reserves had dwindled, even after it received a record $5 million in cash and rent assistance from taxpayers in the 2024 fiscal year – as well as hundreds of thousands more in 2025.
A portion of its revenues in recent years came from the federal American Rescue Plan Act, a 2021 law designed to jump start the COVID-era economy. While the money originated at the U.S. Department of the Treasury, it was awarded by then-Gov. John Carney.
Following Longhurst’s resignation, New Castle County Executive Marcus Henry announced that Leonard would take over as the PAL’s board chairman. Leonard then named one of his officers, New Castle County Police Lt. Angela Dolan, as its interim executive director.
During a New Castle County Council meeting last fall, Dolan described the array of activities offered by the PAL, including a basketball league, a flag football league, a soccer clinic, a Lego league, a book club, and an art club.
Then she expressed dismay over what she feared could be the organization’s future.
“When you see these kids come in and love what they’re doing and what they’re being exposed to, it’s really hard to think that this could end,” she said then.
Who controlled the finances?
In the months that followed, Longhurst did not comment publicly, even after reports surfaced that her former nonprofit faced a criminal investigation, and an audit that could force it to pay out hundreds of thousands of dollars.
On Wednesday, she broke her silence in an interview with Spotlight Delaware that primarily consisted of her suggesting several questions that should be asked of the PAL’s board of directors, including about the quality of their past oversight, and about a former staffer who she said had the authority to make spending decisions.
Last year, Spotlight Delaware learned that the organization’s board of directors had not held meetings on a regular basis.
Longhurst did not directly answer the question of why money granted for capital projects may have been used for operating expenses during her tenure.
“All I can say is, you know, were procedures put in place?” she said. “The people who were supposed to oversee that. Were they?”
When pressed that those spending decisions would have been hers to make as executive director, Longhurst said, “Actually, they weren’t.”
Instead, she claimed that a former bookkeeper at the PAL “had full autonomy over all the finances.”
Asked whether she has been contacted by either state of federal criminal investigators, she said she had not.
In her comments, Longhurst also showered praise onto the PAL and its mission. She said the organization with community centers across the county has an impact that is underestimated in Delaware.
“I have nothing but great things to say about how wonderful the PAL is,” she said.
The PAL of Delaware operates athletic, arts and academic programs at community center locations in Hockessin, Delaware City and suburban New Castle. The settings place children in contact with law enforcement as part of a founding principle “of building bridges between police officers and the communities they serve,” according to the PAL of Delaware website.
The nonprofit also has been an integral piece of Delaware’s political landscape, with elected officials regularly making public appearances at its locations.
Until 2024, it also was one of several prominent Delaware organizations led by a state lawmaker. That ended last September when Longhurst — then among the most powerful politicians in Delaware — lost her seat representing the Bear area to now-Rep. Kamela Smith, a Democrat.
Could the state be liable?
At the New Castle County Council meeting Tuesday, Councilman John Cartier asked Leonard about the state’s deadline for the PAL to pay back its $876,000 debt.
That deadline, Leonard said, had already passed. He noted that state officials want to reclaim the dollars immediately so they could award them to another organization ahead of the end-of-the-year deadline to spend the dollars.
He also recounted a conversation last month with state officials, who described different scenarios that could result from their demand. The PAL could pay back the money in full. The state could place a lien on the organization’s property.
Or, federal and state officials could “look to the party responsible for the mismanagement at the time to recoup those funds,” Leonard said, without detailing who the responsible party might be.
Also at the council meeting, Councilwoman Janet Kilpatrick pressed the police chief about whether it was state or federal officials demanding the money back.
Leonard said it was both. All of his meetings with regulators have been through the state, he said, but with a U.S Treasury official in attendance.
“So the state would like the money back to redistribute, but Treasury has the ultimate say on any forgiveness,” Leonard said.
The U.S. Department of the Treasury did not respond to a request to comment on this story.
Kilpatrick then asked Leonard if he met with Delaware lawmakers. She suggested the state may have liability around any misspent money if officials had not conducted sufficient oversight.
Kilpatrick then noted that Delaware’s annual capital budget hearings are set to commence soon. In response, Leonard said the co-chairs of the state’s primary budget committee have been briefed on this “on a continual basis.”
He also noted that the PAL has applied to the Delaware grant-in-aid program for the next fiscal year. The program distributes tens of millions of dollars annually to Delaware nonprofits.
Last summer, lawmakers paused a grant-in-aid package to the PAL after evidence of its financial crisis first emerged. Ultimately, the state distributed more than $600,000 to the organization during the current 2026 fiscal year, which ends on June 30.
Asked about the nature of Leonard’s recent conversations with lawmakers, a spokesperson for the Senate Democrats said in a statement that they “welcome communication” from PAL leadership, but “in our current fiscal climate, we cannot commit to allocating state funds to cover their shortfall at this time.”
The spokesperson also stated that she would not characterize the PAL’s past outreach with legislators as “continual.”
In an interview with Spotlight Delaware, Leonard declined to go into details about the frequency of past conversations with lawmakers.
He also said the organization is not at risk of closing, stressing that all three PAL community centers are running at normal times.
To rebuild its finances, he said the organization has begun leasing its facilities out during off hours. He also stated that conversations with the state officials about an “appeal process or a forgiveness option” for the demanded money have occurred.
“We are working through possible ways to make good on our obligations,” Leonard said.
