This year marked the 40^th anniversary of AIDS Walk New York, an annual fundraiser benefitting Gay Men’s Health Crisis (GMHC) and other HIV service providers. Last month’s event coincided with another significant milestone in GMHC’s history—the appointment of its new CEO, Jonathan Mallow, a prominent figure in past AIDS Walks who also served on GMHC’s board of directors for more than seven years.

Mallow has taken over as leader of the charity in a difficult political and fundraising climate. Under the current administration, funding for socially progressive causes remains perpetually under threat. With government funding comprising more than half its annual contributions and grants in recent years, this could pose an existential threat to the charity. In addition, financial documents reveal that GMHC was already facing liquidity issues that began well before President Trump’s second term.

Can the Organization Afford to Continue Operating?

GMHC’s audit reflects concern over its financial condition, necessitating that its management consider if there is a substantial doubt about the charity’s ability to continue as a going concern. According to its 2023 consolidated audit, the Organization ended the year “with a net deficit as a result of consecutive decreases in its changes in net assets from operations in 2023 and 2022.” In layperson’s terms, the charity spent more money than it raised or earned in those years.

While it is normal for a charity to spend more than it raises in some years, and raise more than it spends in others, a trajectory of losses can put an organization’s ability to continue its operations in jeopardy. In this case, GMHC & Affiliates ended 2023 with negative assets of $(663,792). Meaning, the organization owed that much more to outside parties as compared to the total value of its assets. This is an improvement from the prior year in which it reported a negative net fund balance of $(1,590,614) at 12/31/2022.

Management’s Plans to Alleviate Financial Woes

According to the Gay Men’s Health Crisis (GMHC) consolidated audit of December 31, 2023 (Note 10, Due to Related Party):

“In December 2022, the Organization received an advance from an officer in the amount of $201,572…There was no written agreement between the officer and the Organization. The balance was repaid in full in January 2023.” The audit did not disclose the officer who loaned the funds, nor did the charity file a Schedule L with its tax Form 990 detailing the transaction. Either way, a loan from an officer is a stopgap to address short-term liquidity issues, not a solution for moving the organization permanently out of the red.

In its fiscal 2023 consolidated audit, published on September 26, 2024, the charity’s management communicated its plans for improving its financial outlook. According to audit note 15, “Financial Condition:”

“At December 31, 2023 and 2022, the Organization ended the year with a net deficit as a result of consecutive decreases in its changes in net assets from operations in 2023 and 2022. Management has considered whether there is substantial doubt about the Organization’s ability to continue as a going concern due to these factors and evaluated its available cash balance over the next 12 months from the date the consolidated financial statements are available to be issued.” 

“To alleviate the concerns noted above, management has budgeted for fiscal year 2024 to alleviate losses by applying for additional grants, subleasing additional floors, expanding the 340(b) program and focusing on reducing expenses.”

“The Organization continues to focus on expanding its government fund programs, through strategically applying for grants aligned with the Organization’s Strategic, portfolio of services, as well as its resources. The organization ended 2023 with $14,241,437 in revenue from government contracts. The Organization budgeted $21,046,051 in revenue from government contracts for 2024, for an increase of $6,804,614.”

“The Organization continues to offset its office-related occupancy expenses, by subleasing a portion of its leased space. The rent commencement for the 2nd Floor sublease began on January 1, 2024. To date, the Organization has subleased approximately two and a half floors out of six. The Organization is currently in negotiations to sublease the 7th floor and hopes to have the new tenant in place by January 1, 2024. The Organization will continue to occupy the remaining two and a half floors.” 

“In fiscal year 2024 the 340(b) Pharmacy program revenue has increased by roughly 40% as compared to fiscal year 2023. In the fourth quarter of 2024, GMHC will begin billing for the medical services related to the 340(b) Pharmacy. GMHC’s projected medical expenses for the program in FY2024 are expected to be $1,897,908. These expenses are for medical visits and lab fees. Going forward, the Organization will bill the patient’s health insurance for those services. The Organization and the providers are currently credentialed with insurance providers.”

Gay Men’s Health Crisis Won’t Answer Questions About The Current State of Its Finances

CharityWatch contacted GMHC on May 7th, 2025 via email with questions about the current state of the charity’s finances. We heard back from the organization’s Director of Community Relations, Krishna Stone, who told us our inquiry was forwarded to “one of the senior managers in the Finance Department.” When we didn’t hear back we followed up on May 28th, 2025. Nearly 7 weeks after our original inquiry, the charity has still not provided answers to our questions as of the publication of this article (June 24th, 2025).

Questions We Submitted to Gay Men’s Health Crisis

1) Has the organization been successful in subleasing additional office space (such as the 7th floor that was currently still in negotiations at the time the audit was published)? 

Can you provide a figure for how much the organization earned from subleasing revenue in fiscal 2024? If an exact figure has not yet been finalized a ballpark number will do. 

2) Audit note 15 outlines management’s plans to expand its government funding. Was it successful in doing so in fiscal 2024? Did it meet its target of $21 million? 

Given government cutbacks under the new Administration, has the organization experienced any cuts in its government funding and if so, how much? Does it anticipate more going forward? Can you provide some additional detail on this topic, e.g., a percentage of increase or decrease in government funding in 2024 relative to 2023; and any information you have about additional losses or gains in government funding that have occurred or that you anticipate will occur in 2025? 

3) When do you anticipate the organization’s fiscal 2024 audit and 990 becoming available to the public?

4) Do you have any additional comment on the organization’s current financial condition?

5) The yellow book audit cited a material weakness in the organization’s internal controls over financial reporting processes as it relates to 2022 government funding. It also cited a material weakness in the organization’s internal controls over financial reporting related to ineffective design and implementation as it relates to 2023 government funding. 

Have these issues been corrected? 

If yes, what specific steps did the organization take to correct these issues? 

Have these issues impacted the organization’s ability to obtain government funding?

Conclusion

Despite its financial woes, Gay Men’s Health Crisis manages to continue operating fairly efficiently with respect to how it raises and spends public dollars. CharityWatch determined that the charity spent $18 to raise each $100 in cash support in 2023, and that it spent 65% of its cash expenses on programmatic activities as compared to 35% on overhead. This earned it a rating of “B” for the year on CharityWatch’s “A+” to “F” rating scale. It serves over 9,000 clients each year, according to its most recent tax filing.

Will you help CharityWatch continue our important work?

As the only independent charity watchdog organization in the United States, CharityWatch relies on your support to fund our in-depth research and analysis in order to bring you the unbiased charity ratings and other information you rely on to help you make more informed giving decisions. We are not directly or indirectly funded by nonprofit industry interests.

We hope you will consider making a donation today so that we can continue to speak openly and critically and call out wrongdoing when we see it without concern for special interests cutting our funding. CharityWatch is a small organization and your donations are noticed, needed, and greatly appreciated. Thank you for giving wisely!