FOUNDATION WILL CLOSE DRUG-ABUSE PROGRAM

RALEIGH (AP) -- A foundation that U.S. Rep. Frank Ballance helped create
will shut down its drug- and alcohol-treatment program after losing state
financing earlier this year.

Eddie Lawrence, who serves as director of the program for the John A. Hyman
Foundation, said that the substance-abuse program would continue providing
services to current clients through the end of the month and then close.

The foundation has come under increasing criticism since January, when the
N.C. Department of Correction withdrew funding because it failed to provide
audited financial statements. It had received about $2million from the
department since 1994.

The organization had also failed to file tax forms required of charitable
groups showing how it disbursed the money, and some critics charged that it
served as a conduit for Ballance's political patronage.

Pastors at several churches that received grants from the foundation to
provide drug counseling have been Ballance political supporters and donors.

Lawrence, though, said that the people of Warren and Halifax counties will
suffer when the program closes.

In those counties, the foundation held classes two nights a week for drug
addicts and drunken-driving offenders. For some participants, the classes
were part of court-ordered counseling. Lawrence said that without the state
money the foundation no longer has the money to offer the classes.

Ballance serves as chairman of the foundation's board but has declined to
comment on it pending the release of a state audit that is examining the
group's finances.

The state audit of the Hyman Foundation is expected to be completed soon.

Tax returns that the foundation has begun to file show that it gave $7,250
in two years to a nonprofit day-care center owned by Ballance's mother.

Other records show that two of Ballance's campaign staff members are paid
employees, and that some of the small grants went to nonprofit agencies run
by campaign contributors.