Newspaper Sold By the Homeless Raises Questions

`GET your Street News, read about the scandal!'' shouts vendor Pam Stacey as she sells copies of the tabloid in Times Square. ``People love to read about scandals,'' says the homeless woman. ``It sells a lot of papers.''

But this particular scandal is about the newspaper itself, Street News, which Ms. Stacey and some 500 other homeless vendors sell to earn money.

The paper features a mix of celebrity interviews and articles about homelessness and other social problems. The biweekly paper began publication in New York nine months ago. Its premise: that the homeless could make money by selling something of value instead of having to panhandle.

Hutchinson Persons, a 34-year-old rock musician from Elyria, Ohio, who founded Street News, says more than 200 homeless people have found apartments because of the money they have made selling the tabloid.

Next month, Mr. Persons plans to extend distribution of the newspaper to San Francisco and Washington, D.C. By the end of the year, Persons says he expects homeless people in 16 cities to be selling the newspaper.

For vendors like Stacey, Street News is a ticket out of homelessness. Stacey and other vendors buy Street News for 35 cents, and sell it for 75 cents, making a 40-cent profit on each issue.

``For four hours' work, I can make $80,'' says Stacey, who adds that she has saved $787 in just a month and a half. ``I'm on my way to getting out of a shelter and getting my own apartment.''

But established homeless groups wonder if Persons is using the sweat of the homeless to create a newspaper empire for himself. They say putting money in the hands of the homeless by selling newspapers will not solve the problems of homelessness.

Peter Smith, president of the Partnership for the Homeless, maintains that Persons's views of helping the homeless are too simplistic.

``We're not against the homeless getting some quick money,'' Mr. Smith says. ``But to say selling newspapers is going to solve the homeless problems is crazy. The homeless need training for real jobs and continued counseling and support.''

A Street News editorial saying that soup kitchens should charge 25 cents for a meal to raise the self-esteem of the homeless has raised the ire of homeless groups.

``People don't go to soup kitchens because they need self-esteem,'' says Mary Brosnahan, associate director of the Coalition for the Homeless. ``They go because they are hungry.''

Persons concedes his organization needs to offer counseling and job training. ``We're just starting out and we are going to improve on what we're doing,'' he says.

Persons founded Street News after an unsuccessful attempt to promote a rock concert around the theme of a ``Hunger Awareness Day.'' He spent 18 months trying to raise $1 million to benefit the hungry; after raising only $62,000, he scrapped the project and started Street News.

The Internal Revenue Service is reviewing the newspaper's status as a tax-exempt charity. The New York State Attorney General's Office is conducting a similar inquiry. The Better Business Bureau (BBB) of Metropolitan New York has issued a critical report.

``The question that needs to be asked is whether this is a charity,'' says BBB vice president Rhonda Klein Singer. ``Street News is not giving away anything as traditional charities do. The homeless have to buy the newspaper in order to sell it. Where's the charity?''

But founder Persons says critics are misguided. ``We're a new kind of charity, one that teaches the homeless to help themselves,'' Persons says. ``Giving the homeless a handout wouldn't work. Shelters and soup kitchens help the homeless to stay homeless. There's no motivation for them to get out of their situation.''

Nor have working relationships among staff members been smooth. Amy Connors, former office manager of Street News, was one of eight employees who resigned in May. Ms. Connors complains of frequent disagreements with Persons.

Within the past month, 14 of the 21 people on the Street News staff have resigned or been fired. Two of the five members of Street News board of directors also have resigned.

``Street News was a good idea,'' says Clint Bolick, a Washington, D.C., lawyer who resigned from the Street News board in May. ``But you can't have a stable direction when you have new staff every day.''

Persons admits Street News's operations have been in disarray. ``We're trying to straighten everything out,'' he says.

Under the front page headline ``Street News Scandal?'' in the current issue, Persons, who pays himself $52,000 a year, writes a letter from the editor in which he says Street News has nothing to hide. A financial statement detailing newspaper expenses and contributions is published inside.

Conners and other former staff members plan to start their own competing weekly, to be sold by the homeless, by the end of June.

The prospect of two competing homeless newspapers sits well with vendor Stacey. ``I can even make more money than I am doing now by selling both papers,'' she says. ``There's nothing wrong with competition.''