The Urban Corps of San Diego County has parted ways with chief executive officer Kyle Kennedy, saying in a public statement that it was time for a change in leadership.
The decision was announced just before the Fourth of July holiday weekend, and almost 13 months after the board of directors was first told that Kennedy directed his staff to renovate a house he had bought from a subordinate.
“We are grateful to Kyle Kennedy for his passion for the Urban Corps mission, both as CEO and previously as CFO,” the statement said. “His work to lead the organization through the pandemic is specifically appreciated by the board.”
The San Diego Union-Tribune reported last month that Kennedy had relied on dozens of Urban Corps workers to renovate a three-bedroom, one-bath home he bought in the Shelltown neighborhood of San Diego from his human resources chief.
More than two dozen workers spent a year remaking the interior and exterior of the home, which is now being rented to Urban Corps members, the organization said.
In a prior statement, the board acknowledged that the work assignments were “improper.” Critics said it was not only inappropriate but could jeopardize the nonprofit’s tax-exempt status.
Two Urban Corps board members resigned last fall after Chair Tracey Williams opted not to fire Kennedy but instead place him on a temporary improvement plan.
Kennedy did not respond to questions about his departure from the nonprofit organization dedicated to providing life and job skills to disadvantaged young adults up to 26 years old.
Many of the workers lived at the home during the lengthy renovation, according to the findings of the investigation reviewed by the Union-Tribune. The Urban Corps board said some of the staff now are Kennedy’s tenants there.
In the latest public statement issued by the board, directors said the move toward a new CEO was made in early June, before the misuse of nonprofit assets was disclosed.
“The time is right for a change in leadership to support the organization’s next chapter,” the board said. “This decision predates recent media reports and is being effectuated now that we have had time to prepare for this transition.”
Longtime Urban Corps official Anne Bernstein has been installed as the acting CEO while a search for a permanent successor is underway.
Bernstein served as the Urban Corps chief operating officer for many years and also served as interim CEO before Kennedy was named to the post in 2019. She remained in a part-time role as the organization’s board and legislative liaison.
A house renovated by Urban Corps staff in San Diego, California. (Ana Ramirez / The San Diego Union-Tribune)
According to a November resignation letter submitted by former board member Mario Sierra, Bernstein and Kennedy asked Sierra to conceal the use of Urban Corps personnel to renovate the investment property from the board.
“As I previously reported to the board on June 4, 2024, Kyle Kennedy and Anne Bernstein requested to meet with me and specifically asked I not include (other board members) in the meeting,” the letter states.
“Kyle and Anne’s objectives were for me to convince Sam Duran not to move forward with allegations against Kyle and, as they stated, ‘squash’ Sam Duran from informing anyone, including the board, of Kyle’s extensive home improvement project,” it added.
Duran is the Urban Corps of San Diego County founder and former longtime chief executive who first learned of the improvements when he randomly drove down Epsilon Street and saw Urban Corps trucks and workers renovating the property.
He reported the misuse of resources, and Urban Corps launched an investigation that resulted in Kennedy being placed on the improvement plan.
Duran last month told the Union-Tribune that he was extremely bothered by the board’s response.
“If you’re hiding stuff like that, it brings dishonor to what your (organization’s) goal is, and that is to bring these kids around and make them better citizens,” Duran said.
Urban Corps did not respond to questions about Sierra’s claim in his resignation letter that Bernstein had sought to conceal Kennedy’s improper use of nonprofit workers to remake his personal property.
“Mr. Kennedy’s actions were his and his alone, a fact supported by the investigation commissioned by the board,” the agency wrote in response to questions. “Ms. Bernstein has and continues to be very cooperative and transparent with the board.”
Since Duran first established the Urban Corps of San Diego County in 1989, modeling it after the California Conservation Corps, the organization has grown into a $20 million business that provides job training, education and life skills to hundreds of young people a year.
The vast majority of its revenues comes from contracts with cities and other public entities to trim trees, landscape, carve trails and perform other work.
According to the Urban Corps’ most recent tax filing, which covers the year ending June 30, 2024, no one at the organization was aware of any improper transactions, even though both Duran and Sierra informed other board members of Kennedy’s actions earlier that month.
Nonprofit officials said in the latest public statement that they are investigating the accuracy of the group’s IRS Form 990, which was signed under the penalty of perjury.
“We are aware of the seriousness of these concerns and are actively working with legal counsel to assess all compliance obligations related to this matter,” the statement said.
“Ensuring that Urban Corps is compliant with all requirements for its tax-exempt status and adheres to all IRS regulations has always been and continues to be of the utmost importance to the board,” it added.
Originally Published: July 4, 2025 at 1:30 PM PDT