No Halo News · Sourced development
Children’s Home of Kingston plans program closures as audits report losses, repayment exposure and going-concern doubt
New York agencies confirmed that the Children’s Home of Kingston notified regulators on October 7 that it planned to close its Grove Street facility in January 2027. The Times Union reported that an independent audit identified operating losses, negative cash flow, the expected loss of major federal program revenue and substantial doubt about continued operations. The audit reported a liability exceeding $2.75 million for federal grant funds received above allowable costs. A separate state comptroller audit identified $670,549 in reported special-education costs that did not meet reimbursement rules, although the cause of the closure has not been established.
Status matters. This page records a sourced development, not a completed No Halo investigation. An allegation is not a finding. Dismissals, settlements, judgments, corrections and final outcomes remain distinct.
Donor relevance
Why this matters
The planned closure affects residential, educational and mental-health services for vulnerable young people. The reported repayment exposure, recurring losses and loss of federal revenue present significant risks to clients, employees and creditors.
Attribution
Who reported or established this
The closure was confirmed by the New York State Education Department and Office of Children and Family Services. Financial concerns came from an independent audit and a New York State Comptroller audit reviewed by the Times Union.
Evidence limits
What remains unverified
No Halo has not established whether the cited financial issues caused the board’s closure decision, the final amount that must be repaid, whether replacement funding remains possible or which programs and corporate activities will continue after January.
Right of reply
Organization response
CEO Leila Santana said the board was responsible for decisions concerning the proposed closures and that the organization was coordinating with regulators to protect youth and maintain continuity of care. In the independent audit, she acknowledged weaknesses involving historically underqualified accounting staff and said a new controller was improving records, invoice approvals and other controls.
Classification
How No Halo records this event
Event type: Financial Distress. Current state: Pending. No Halo preserves the current procedural state rather than treating every mention as a finding.
Published October 22, 2026 · Last verified October 23, 2026. See an error or a later outcome? Submit a correction or right of reply.