PA Treatment & Healing was built to serve juvenile delinquents. Its youth programs collapsed. Addiction treatment — funded by county contracts — is what’s left. A board member is also the highest paid contractor.
Read Part I: Wayne County Has Four Licensed Addiction Providers. It Pays Two.
When Wayne County’s Drug and Alcohol Commission refers a court-ordered client to outpatient addiction treatment, one of two providers gets the call. One of them is PA Treatment & Healing, a nonprofit that operates an outpatient office at 1855 Fair Avenue in Honesdale under a Single County Authority contract funded by state Department of Drug and Alcohol Programs grant dollars.
PATH is headquartered in Milton, Northumberland County — roughly 90 miles from the Wayne County clients it treats. Its GuideStar nonprofit profile lists four facilities: Altoona, Milton, Honesdale, and East Stroudsburg. As a separate Pocono Review report documents, it is one of only two outpatient providers contracted by the county, despite four holding full DDAP licenses in the area.
A Pocono Review analysis of PATH’s IRS Form 990 filings — obtained for nine fiscal years between 2013 and 2024 through ProPublica’s Nonprofit Explorer — reveals an organization that has been financially deteriorating for a decade, has abandoned the mission it was founded on, and carries a governance arrangement that contradicts its own disclosures.
When the Counties Stopped Buying
PATH was incorporated in 1983. Its original purpose, stated on every 990 through FY2018: to provide intensive day treatment for delinquents and status offenders and prepare those youth for reintegration into the community.
For three decades, that’s what it did. In FY2013, PATH ran at least five program lines across eastern and central Pennsylvania. The Intensive Adolescent Program brought in $1.86 million. Alternative Education brought in $1.24 million. Day Treatment: $535,000. A residential halfway house for adolescent males brought in $264,000, offering 24-hour supervised care.
Drug and alcohol outpatient treatment was a side operation — $219,670 in revenue, barely 5% of $4.4 million in total program income. D&A ranked last among the named program lines.
Then the counties stopped paying. Pennsylvania’s juvenile placement market contracted — fewer referrals, tighter budgets, a policy shift away from placing kids in private residential programs. PATH’s youth revenue collapsed with it. Between FY2014 and FY2018 — the last year PATH broke out revenue by program — the Intensive Adolescent Program fell from $2.48 million to $872,000. Alternative Education dropped from $1.48 million to $621,000. Foster Care disappeared from the filings. The adolescent residential program shut down in September 2014, per PATH’s FY2015 Schedule O.
D&A moved the other way. It hit $506,000 in FY2015. $974,000 in FY2016. $1.08 million in FY2017. By FY2018: $1.35 million, making it PATH’s largest program. The FY2018 990 narrative reported a 35% increase in D&A clients in a single year — from 393 to 529.
After FY2018, PATH stopped reporting revenue by program. Every filing from FY2022 through FY2024 shows a single line: “PROGRAM REVENUE.” No breakout by service type. No breakout by location. How much comes from Honesdale versus East Stroudsburg versus Milton is invisible from the public filings.
The mission statement tells the same story in miniature. Through FY2018: “educates and prepares troubled youth for reentry into mainstream society.” By FY2024: “educates and prepares individuals.”
What’s Left
In FY2013, PATH held $5.25 million in net assets. It owned nearly $2 million in publicly traded securities and real estate carried at nearly $1 million. It employed 192 people across its locations. Its auditor was ParenteBeard (now Baker Tilly), a major regional firm. Federal grant audits were required and completed.
By FY2024, total net assets had fallen to $34,630.
That figure requires a closer look. PATH’s 990 separates net assets into unrestricted and donor-restricted. Unrestricted net assets — the money the organization can actually use — stood at negative $118,532. The total only stayed above zero because of $153,162 in donor-restricted funds PATH cannot spend on operations. Strip the restricted money and the organization is insolvent on an operating basis.
The investment portfolio — $2.09 million in FY2013, $1.34 million in FY2015 — was gone entirely by FY2022. The real estate went with it: land, buildings, and equipment fell from $778,908 in book value (FY2015) to $61,574 by FY2024. PATH sold or depreciated away nearly everything it owned.
The workforce shrank from 196 employees (FY2015) to 62. The organization changed addresses three times — Turbotville to Williamsport to Milton. It changed accounting firms twice — ParenteBeard to Larson Kellett & Associates in Montoursville, then to GBB & Co in Allentown. It ran through at least four presidents: Jerilyn Keen-Katherman ($138,000, 50 hours/week in FY2013), co-presidents Michele Barrows and Steve Gaito (through FY2018), Aracely Mitchell (FY2022), and current president Kristi Harris ($41,858 in FY2024 — less than a third of what Keen-Katherman earned).
PATH ran deficits of $170,000 (FY2023) and $184,000 (FY2024). Accounts payable — what it owed but hadn’t paid — nearly quadrupled in a single year, from $36,464 to $136,906. A $150,000 SBA loan remained on the books alongside $22,854 in vehicle loans and $26,746 in payroll liabilities.
The organization’s licensed outpatient capacity at the Honesdale location, per the DDAP facility locator (sais.health.pa.gov), is 235 clients. That number has been on the license since January 31, 1996. With 62 employees spread across multiple sites statewide, what share of that capacity is actually staffed is unclear.
PATH reported zero fundraising revenue, zero fundraising expenses, and zero volunteers in FY2024. Its entire revenue — $2.63 million — came from program service contracts ($2.42 million) and government grants ($204,638). There is no margin for error, no reserve fund, no donor base, and no alternative revenue source. If a single county pulls a contract, the math stops working.
The Board Member on the Contract
Ayaz Mahmood Khan, MD, of 553 East Third Street in Williamsport, appears twice on PATH’s FY2024 filing. As a board Director: zero compensation, two hours per week. As an independent contractor: $122,080, described as “CONSULTANT.” He is the organization’s only contractor paid more than $100,000.
The same arrangement appears on the FY2023 filing at $111,912. Khan does not appear on the FY2022 filing at all. The dual role — board oversight and six-figure consulting contract — is new.
PATH’s Schedule O disclosures have included conflict-of-interest language for years. The FY2016 filing — prepared when the organization was four times its current size — stated it plainly: “PA TREATMENT AND HEALING DOES NOT DO BUSINESS WITH ANY OF THEM DIRECTLY OR INDIRECTLY. NO BOARD MEMBER HAS ANY MONETARY INTEREST IN THE ORGANIZATION. ALL BOARD DIRECTORS ARE STRICTLY VOLUNTEERS.”
By FY2018, under different leadership, the same Schedule O repeated: “PA TREATMENT AND HEALING DOES NOT DO BUSINESS WITH ANY OF THEM DIRECTLY OR INDIRECTLY.”
The FY2024 Schedule O says potential conflicts “are mitigated through abstaining from relevant votes.” It does not acknowledge that one of nine voting board members is simultaneously the organization’s highest-paid contractor. Whether Khan recuses himself from votes affecting his own consulting arrangement, and what the remaining eight members understood when the arrangement began, is not addressed in any public filing.
PATH’s FY2024 990 reports total contractor spending of $230,210. Khan‘s $122,080 accounts for more than half of it. On an organization running a $184,000 annual deficit, that single consulting contract is not a rounding error. It is a material expense being paid to a person who sits on the board that approves the budget.
PA Treatment & Healing’s IRS Form 990 filings are publicly available through ProPublica Nonprofit Explorer (EIN 23-2298248). DDAP facility licensing data is available through the Pennsylvania Department of Drug and Alcohol Programs facility locator at sais.health.pa.gov. All financial figures, compensation data, program revenue breakouts, Schedule O disclosures, and contractor information cited in this article are drawn from PATH’s 990 filings for the fiscal years specified.
Pocono Review is an independent investigative news outlet covering Monroe, Wayne, Pike, Carbon, Lackawanna, and Luzerne counties. We report on the government, never for it.
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