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Jason King Responds to Sean's Outpost Transparency Questions

Published on November 20th, 2014 by adam
This is an open letter written by Jason King, founder of Sean's Outpost in response to Ben Doernbergs' recent questions on the topic

It can be very uncomfortable to be criticized. Especially in the context of what we have accomplished here at Sean's Outpost. 
 
My first impulse is to be extremely defensive. After all, we have accomplished so much. 
 
Sean's Outpost is active pretty much everyday. We are the largest provider of meals to the homeless in Escambia County Florida. And in our FIRST year of operations we outpaced the second largest organization by over 6,000 meals. To date, we have fed over 130,000 meals to the homeless and seven months into our second year of operation, we are on pace to out perform our closest "competitor*" by over 70,000 meals distributed, more than doubling their output. 
 
Note: The word competitor is a point of contention at Sean's Outpost, we do not look at other homeless outreaches as being in competition with us. However, do to the finite grant and public resource dollars available for most traditional homeless outreaches, they tend to view other providers in their area as "competitors"
 
All of those meals are in addition to the value provided to the homeless community thru our 9 acre homeless sanctuary, Satoshi Forest. 
 
We have accomplished those feats and MUCH more with a small fraction of the budget of every other homeless outreach in our area. In fact, I believe Sean's Outpost is one of the leanest, most effective homeless outreaches in the state of Florida and the entire United States. We are privileged to have earned the trust and respect of our local homeless community.   And equally, we are humbled to have been given so much trust by the bitcoin and cryptocurrency communities at large. 
 
These statements would be very hard to refute. And on their own merit, many have said and continue to say, that we owe no explanation for how we operate. Our deeds, simply put, speak for themselves. And in truth, my first inclination is to rest on that laurel. We are doing more, for less. 
 
However, upon reflection, there is a deep flaw in that reasoning.
 
Myself, and the other members of Sean's Outpost have NO INTEREST in simply being incrementally better than the next guy. We want to be exponentially better. And there is no way to do that by defending poor decision making. And, as I have stated before, no one should have to trust us. The point of bitcoin is that it is a TRUSTLESS technology. And for an organization that so publicly espouses the use of that technology, we have done an abysmal job of fully embracing it's utility. 
 
I apologize for that. Sean's Outpost should have moved to a a multi signature wallet as soon as the technology became stable and readily available. That's pretty ironic (or maybe hypocritical?) since I have been advocating the use of multi sig for charities for over a year. In fact, we have been talking about implementing it here at Sean's Outpost for about a year as well.
 
The house painters house is never painted.
 
This is being rectified IMMEDIATELY. If you will notice, we have moved no funds from the Sean's Outpost wallet since November 3rd, 2014, eleven days before Ben's "Open letter". That is because we have been working on a solution to provide total transparency and security to our donated funds.
 
We would like to announce that Sean's Outpost has the privilege of taking part in BitGo's enterprise secure wallet open beta. I have watched BitGo develop over the last year and have consistently been impressed with their product offering. We had our initial meting with the BitGo team yesterday, and they are streamlining getting us setup.
 
The multi sig will have three key holders, those are...
 
Jason King, Sean's Outpost Co-Founder(ME!)
Mike Kimberl, Sean's Outpost Co-Founder
Tim Frey, Roberts & Roberts Brokerage
 
No funds will move from our current wallet until they move into our multi sig wallet. And in the future, no funds will be spent without two of three agreeing on the spend and a blockchain notation of exactly what the funds are being allocated for. All funds from our legacy address 1M72Sfpbz1BPpXFHz9m3CdqATR44Jvaydd, will be swept into our new multi sig address. And our public donation address will be changed to reflect the change to multi signature.
 
So how much has Sean's Outpost raised so far?
 
To date, Sean's Outpost has raised approximately 943 BTC (since March of 2013) at a total cash value of approximately $231,530
 
Of the total donations, 532 BTC were provided from my wife and I at an approximate cash value of $87,326
 
Approximate Expenses to Date:
 
PAYROLL:  $86,790
 
Position 2014 2013
Operations Director (Mike Kimberl) $23,000 $9,300
Supply Manager $10,100 $1,100
Food Prep $4,600  
Driver $6,900 $5,600
Driver $5,100  
Driver $4,150  
Driver/Retail Associate $6,800  
Retail Management $3,200  
Retail Management $3,600  
Driver $1,800  
Food Prep $640  
*Retail Management (Leslie King) $900  
* I had previously stated that the only board member to derive salary or monetary compensation was Mike Kimberl. That statement was incorrect. When I said that I forgot Leslie King acted as interim retail manager for three weeks in March after the departure of our original manager and before a replacement was found. 
 
Leases Total: $34,300 -
 
Outpost Thrift: $22,700 (9 months @ $2300 + $2000 deposit)
: $4,600 (11 months @ $400 + $200 deposit)
BitHouses Workshop: $7,000 (6 months @ $1100 + $400 deposit)
 
Utilities Total: $12,237.85 -
 
Cointainers, INC $1,816.76 - Sanitation
Gulf Power $5,137.96 - Electricity
ECUA $1,487 - Water/Sewer
ATT $871.87 - Phone/Internet
Waste Management $3,796.13 - Dumpster
 
Satoshi Forest Total: $43,901.50
 
Down Payment: $5,000
Closing Costs: $3,225
Mortgage Payments: $9,000 (15 @ $600)
Privacy Fence: $4,002
Wetland Sciences: $800 - Wetland Survey
Larry Jacobs: Geotechnical Engineering: $1,250 - Geotech Survey
Empire Land Survey: $8,375 - Land and Boundary Survey
Landmark Engineering: $7,800 - Civil Engineering
Title Search: $125
Brushhog: $850
Landscaping: $400
Health Department Inspections: $1,100 (State of Florida)
Legal Transcripts: $1,595.50
Propert Taxes: $379
 
BitHouses Project Total: $12,000
 
Prototype 1: $3,850
Prototype 2: $7,400
Tools: $750
 
Food/Water and Food Prep Supplies Total: $36,478
Discount or Wholesale Food/Water: $19,740
Retail Food/Water: $8,300
Bay Area Food Bank: $3,839
Food Prep Supplies: $4,599
 
MISC. $9,822
 
 
Sean's Outpost Operations: 
 
In our initial post to the bitcoin community we made this statement...
 
"Here at Sean's Outpost, we regularly make up sack lunches and take them into the fringes of society to feed the homeless. We journey under bridges and overpasses. We delve deep Into the makeshift thunderdome-esque camps that many of the unhoused dwell in. We go there with no political or religious message. We just go there with food and water. We tell people to "Stay safe and stay strong."

 

This is still a great description of Sean's Outpost. To this day, it makes up the majority of the help we provide to the homeless. We are the ONLY such street outreach operating in Escambia County. And that's an important distinction. Most homeless feedings are stationary, and as such they do not reach the homeless that are shy, proud, injured, or the ones that would simply prefer to stay out of public view. Sean's Outpost meets the homeless population where they live. 

 

We also provide four stationary meals a week at Brentwood Park. 

 

In December of last year an arsonist burned down the kitchen at The Alfred E. Washburn Center, a homeless day center in Pensacola. From the day after the fire, Sean's Outpost has been their meal support. And we continue to be the largest and most consistent provider of meals to their operation. 

 

Satoshi Forest

Satoshi forest is great. A 9 acre homeless sanctuary that provides a legal respite for the homeless in an area where it is functionally illegal to be homeless. Satoshi Forest has been a struggle from the start. In December of 2013, just months after acquiring the property we had our first run in with Escambia County Code Enforcement. They asserted that we were somehow in violation of running an illegal commercial campground, among a host of other trumped up violations. The unfortunate side effect is that Sean's Outpost spent the majority of 2014 embroiled in a legal battle with Escambia County over the right to operate Satoshi Forest. An effort that took up much valuable time, man power, and stalled our efforts at further development of the property. We have so far been victorious, ultimately receiving a positive verdict from the Special Magistrate and with the county dropping it's other lawsuit against us . However, we are still in a holding pattern in regards to the development of Satoshi Forest. Escambia County has expressed it's desire to appeal our verdict from the special magistrate, which exposes an inherent flaw in government  bureaucracy. Even though we have been found not in violation of any law or statue, and Escambia County dropped it's injunction lawsuit against us, the State of Florida refuses to decide on the status of Satoshi Forest as a campground until "All legal proceedings are concluded."

But wait! Didn't you say you won in court and the other lawsuit was dropped? Yes, but until the countie's appeal is heard on our ruling from the special magistrate, the state of Florida still considers us in "ongoing litigation" and will not render a decision. And they really have no time limit on how long that will take. Even when you win, the government still gets it's way. 

 

Satoshi Forest is in legal limbo.

 

Which is disappointing. But all is not lost, it continues to be a homeless sanctuary, primitive camp ground, and we are planting crops towards the goal of turning the whole area into a food forest. 

 

Our regrets: 

As I have already mentioned, I regret not going to multi signature much sooner. It was a case of "If it ain't broke don't fix it." and we are rectifying that now. 

 

Aside from that, the main regret I have is attempting to open a thrift store. In January of this year, we opened "Outpost Thrift" an upgrade from our previous facility. On paper it seemed like a great idea. Alternative source of financial support, separate from direct donation. Access to clothing and goods to provide the homeless. And a facility that could be used as a classroom and emergency shelter

 

The reality is, we had no real retail experience. And the thrift store business is MUCH different than our initial suppositions. Large operators like Goodwill and the Salvation Army actually make most of their money on wholesaling bulk donations of clothing and goods. For example, you can purchase a "cube" of unsorted goodwill clothing for $500. The stores themselves act in much more of an advertising and brand recognition function than anything else. And while Outpost Thrift provided much utility to the homeless community in our area, ultimately we were not able to make it break even, so it was shuttered in.

 

A decision we stand by.

 

In January of this year, with the price of bitcoin hovering around $1,000 we received over 180BTC in donations. Had we pulled the trigger immediately and sold, we would have effectively doubled the USD value of our donations for the year. And quite possibly not have had any financial troubles for the rest of the year and currently still be sitting pretty with cash in reserves.

 

There are a couple of problems with this though. 

 

1) Those donations were donated to us for the expressed purpose of being part of the BTC Endowment that we were trying to raise thru my efforts with "Bitcoin Across America". The idea was, we would raise a large amount of BTC, keep it in our fund, and be able to use the eventual appreciation of the price of BTC to sustain us for a long time to come. That's not how it worked out. /u/tothemoonguy, so far, has not had his wish this year. In fact 2014 has been plagued with downward price pressure. So when our funds on hand ran out for core operations, we had to eventually start spending from those funds earmarked from the run. 

 

2) We are a Bitcoin powered charity, not simply a charity that that accepts bitcoin. We do not, and have not solicited funds in US Dollars. We have always preferred to keep the majority of our holdings in crypto and that will continue to be our preference going forward. 
 
 
Follow Ups:
 
Annual Report

 As previously reported, Sean's Outpost was temporarily delisted from the state corporate registry for a failure to file our annual report. I have been chastised for my cavalier response to this fact. So let me make a couple more points on that subject...
 
1) There has been a large amount of inaccurate speculation on the nature of this deficiency. The "Annual Report" in Florida is, very simply, paying the State of Florida a fee to tell them that your Board of Directors and Registered Agent are the same as they were last year. That's it. We had no changes to our board in 2014 and our registered agent is the same as it was last year.
 
2) As to registered agent, our registered agent is Alistair McKenzie. Who also happens to be the general counsel for Sean's Outpost, INC. By the state of Florida's own protocol, notification of our delisting should have been sent to our registered agent. Not to me. 
 
3) Mailing to me, instead of our registered agent, caused a delay in receiving the notice until the middle of October, as it had to be forwarded to me in Orlando. When the notice was received I simply signed the form, which was included with the notice of deficiency, and mailed it and a money order for the fee in. And then I forgot about it. Because, it is not something that has any functional effect on Sean's Outpost. I have no reason to believe the form and fee will not eventually be added to our account with the state. However, after Ben's informing me on Friday that the state still had not adjusted our status, I used the online reinstatement form that evening and completed the process online with a credit card. Let me also note, that BOTH fees were paid from my pocket, not from Sean's Outpost bank account. I am not even an authorized signer on our bank account. We are again an active registered non-profit with the State of Florida, yay.
 
4) It was previously suggested that one possible effect this could have had was to place us into a grey area within the state of Florida in regards to solicitation of funds. This is also incorrect. In the State of Florida, charities that wish to solicit funds pay for the privilege of that by registering with the Department of Agriculture. Why the Department of Agriculture? I couldn't even begin to guess. However, upon contacting them, and explaining what Sean's Outpost was to the agent, we found out we are exempt from this because WE DO NOT SOLICIT DONATIONS IN US DOLLARS. In fact, we have done very little soliciting at all, under soliciting definitions. On October 9th when we put a call out saying that we were low on funds following the price drop, is to my knowledge the first time other than our initial announcement of formation that we have outright asked for donations. Sean's Outpost has maintained itself thru public display of the works that we have done and a passive donation address. That is not soliciting in the state of Florida. Very similar to how having a donation jar on a table is not soliciting. 
 
5) Sean's Outpost currently engages in no activities that require licenses or permits in the state of Florida. I maintain, our delisting had no functional effect on any of the operations for Sean's Outpost. The main concern was that we be reactivated within the calendar year so that we did not run into any problems with Sean's Outpost property holding of Satoshi Forest. 
 
The RV from Bitcoin Across America
 
From the start when Steven Dakh, Anthony Di Iorio, and I began discussion on Bitcoin Across America, it was proposed as a fundraising effort organized by me (Jason King) for the benefit of Sean's Outpost. Anthony, who is mainly responsible for providing the RV, and I are in very regular contact. In fact, he was the moderator for my skype talk with Bitcoin Decentral in Toronto less than two weeks ago. So any talk that somehow Anthony is being kept in the dark as to what's going on with the RV is silly. Steven and I are in even more close contact as he is one of my best friends. 
 
As to what is going on with the RV. Sean's Outpost has stated many times that we would like to expand our operations to the rest of Florida. Florida, followed closely by California, has the most aggressive anti homeless laws in the country. This is very much the frontline. In late August we decided to explore the option of opening a Sean's Outpost chapter in central Florida. My wife and I went to Orlando, with the RV, and began feeding homeless in the same manner we started in Pensacola and tried to figure out a point of entry for how we could better help in that area. 
 
This was to be a few month experiment as to the situation in Central Florida before driving the RV to Canada for a cross Canadian tour with the RV and Anthony Di Iorio. This idea has been publicized and talked about since the inception of Bitcoin Across America. And it was not canceled until less than two weeks ago. There has been talk (such as when I spoke at Bitcoin Decentral Toronto) of revisiting that idea early next year. I have no idea if that will happen. Anthony is extremely busy, and one of the most active members of the bitcoin community I know.
 
However, I would like to report, Sean's Outpost has voted to sell the RV as soon as it's publicity obligations are cleared. We would like to take the proceeds from the sale of the vehicle and open a commercial kitchen with the possibility of it also functioning as a pay-what-you can soup kitchen/restaurant. 
 
In closing, I would like to talk about my previous history as an entrepreneur and human being. I screwed up a lot in my past. I like to think it was not due to malice but more to ignorance and naivety. But it's possible I'm seeing myself through rose tinted glasses. I think we all do that to a degree.
 
I also have very consistently admitted to the fact that I am a reformed drug addict. The level of my addiction was massive, and I did a wonderful job of hurting most of the people I cared about in my life. Not to mention almost killing myself, on numerous occasions. It was a very bad and very long chapter in my life. One that I truly have no reason to have made it out of alive. But I did.

I am not that person anymore. More so, it has provided a unique insight into the mind of an addict. This has proved invaluable in the work I do now. 
 
My co-founder, Mike Kimberl, is likewise a recovered heroin addict. Neither of us have hid those facts. If anything, Sean's Outpost is proof that redemption is possible. We deal in redemption every day. 
 
Thank you to everyone that has ever supported our work. I hope I have done a decent job of explaining all that we have accomplished so far. Thanks for making it possible. 

Image Credit: Bitcoin Magazine

Editors Note: If you'd like to support Sean's Outpost, their current donation address is 1M72Sfpbz1BPpXFHz9m3CdqATR44Jvaydd although that will be changing once multi-sig is implemented as described above.

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