HUD tells city to repay nearly $4 million in misspent homeless funds

City used federal stimulus funds to underwrite longstanding programs and failed to document expenses

srb at homeless task force

Mayor Rawlings-Blake addresses a homeless task force last month chaired by Housing Commissioner Paul Graziano (center). To his left is the director of The Journey Home homeless program, Adrienne Breidenstine.

Photo by: Mark Reutter

After more than a year of wrangling, the federal government has told Baltimore to repay nearly $4 million of a $9.5 million grant aimed at helping the homeless.

“The City of Baltimore is required to reimburse HUD from non-Federal funds a total of $3,756,025.35,” said a memo based on a meeting last Thursday between the U.S. Department of Housing and Urban Development (HUD) and the Mayor’s Office of Human Services.

The repayment is by far the largest payback required by HUD following a series of audits of big cities who received grants from a homeless prevention program signed into law by President Obama as part of the 2009 Recovery Act.

Still, the reimbursement is well below the $7 million that the federal government signaled could be required just a few months ago.

The City, not Service Providers, Faulted

After publicly denying that there were any substantive issues raised by HUD, the city told homeless service grantees that they might be responsible to repay the disputed funds.

HUD officials have nixed that idea, and the city will have to pay the $3.76 million out of general revenue (taxpayer) funds, sources tell The Brew.

Wounded by HUD’s decision, the Rawlings-Blake administration is preparing to argue before the media that the funds served thousands of needy clients and were a judicious use of federal money.

What a federal audit tells us about city spending (12/5/12)

City reserves $7 million to repay mismanaged federal homeless grant (12/3/13)

Questions but no answers on mismanaged homeless services grant (1/8/14)
At issue were very specific criteria of what constituted a homeless person eligible for the stimulus funds. HUD required extensive documentation of homeless clients and called on the disbursement of federal funds only after time sheets, expenses and other costs were submitted to the city.

The city, however, went about funding the program in its own way, later saying that the federal rules were confusing and changed too often.

In 2009, the Baltimore Housing Department entered into a contract with the United Way of Central Maryland to serve as the fiscal agent of the program.

The agreement called on United Way to disperse federal funds to homeless service providers “monthly in advance,” and further stated that the “monitoring of the expenditures. . . shall be the responsibility of the department, and not the fiscal agent.”

The agreement – approved by then-City Council President Stephanie Rawlings-Blake and Mayor Sheila Dixon – was inherited by the Mayor’s Office of Human Services, which handled the grant and supervised the United Way.

HUD Started Asking Questions in 2011

As early as spring 2011, HUD’s Baltimore Office called on the city to collect documentation supporting the program’s expenditures. Such documentation was not compiled, leading to the critical November 2012 audit by the HUD Inspector General.

By general consensus, Homeless Services and United Way awarded contracts to existing service providers, many of them conducting existing homeless outreach programs that were not part of the grant’s criteria.

For example, Legal Aid used the funds to continue its existing eviction prevention activities, and Power Inside worked with chronically homeless women. Neither program fit into the federal criteria, but providers were told to continue their services with the new funds, various government sources have told The Brew.

No Evidence of Criminality

Last week, the agency reported the following undocumented expenditures from these homeless providers:

• People Encouraging People – $678,643.80
• AIDS Interfaith Residential Services (AIRS) – $600,000
• Legal Aid Bureau – $549,593
• St. Vincent de Paul of Baltimore – $523,228.54
• Prisoner’s Aid Association – $392,982
• Public Justice Center – $336,000
• Baltimore City Community Action Centers (utility assistance) – $224,014
• Power Inside – $273,644
• Jobs, Housing and Recovery (JHR) – $154,831
• Marian House – $51,964
• Baltimore Healthcare Access – $35,498.88

The report does not accuse any group or individual of stealing money; instead the above funds were not properly documented or were used for ineligible activities.

In addition, HUD found that Gabby Knighton, outreach coordinator for the homeless program, was paid $41,667 in stimulus funds on the basis of a “verbal contract” with the Mayor’s Office of Human Services. Without any documentation of the services she rendered, HUD is requiring the city to repay this money.

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  • davethesuave

    it just doesn’t get any better.
    and it doesn’t stay still.
    it just continues to slide downhill.
    are there any defenders of SRB
    left out there in cyberland?
    please step right up. we want to hear
    why she should not be canned.

    (thanks & apologies to Usha, in advance)

    • ushanellore

      Love it.

      This is poetic justice,
      hear, hear the HUD hiss
      like a sibilant serpent and coil
      around the neck of SRB
      to choke and foil
      her weak explanations!

      Keep them coming Dave! Before long we’ll all be talking in poems, even KnowNothing.

    • ushanellore

      Downhill Slalom–a tale of SRB–from BOTCHY–not from SOCHI
      Dedicated to davethesuave for his love of poetry

      SRB wins gold medal for downhill slalom!
      Get up and sing a somber anthem!
      “I am never wrong” her phantasm,
      between her and the truth I see a big chasm,
      tried foisting her fine on some struggling grantees–
      when she couldn’t was livid and knotted her panties,
      the cause of the homeless– a wail from a banshee,
      its demise possible, its existence chancy,
      she covered up her losses with media antics,
      consummate at defensive semantics,
      hoping her subjects are naive romantics,
      she told them the feds confused her with tactics
      that spun her head and made her frantic…

      Documentation– a useless nuisance,
      guidelines– spurned as utter nonsense,
      audits– loathed with a terrible passion,
      SO when money taken and spent didn’t add up,
      and her house of cards it came crashing–
      she claimed the feds confused her with tactics
      that spun her head and made her frantic…

      Usha Nellore

  • ushanellore

    HUD is holding the city’s feet to the fire. Good. HUD audits a city averse to audits and expert at passing the buck. You can fool the people of Baltimore some of the time and others in your ambit most of the time but the feds–apparently– they come in the category–can’t fool even some of the time.

    The city should have kept the books and presented them to HUD, not have a middle group disburse the money and provide the data required.

    SRB has scant respect for official demands, although I am sure she expects those who work for her to march to her orders. She bucks HUD and they buck her. It was her contest to lose and she lost it for the taxpayers. If it had been her personal money at stake, I don’t doubt, she would have kept the books.

  • Lizzie 58

    Like the speed cameras, this dumb, dumber and dumbest aspect of City government would be funny if it were not for the fact that $3.7 Million will have to come out of the funds for some other city service or program that the residents and taxpayers need. This is not a City that can afford to waste its tax dollars. Who is responsible, Mayor? Which of your deputies was supposed to oversee this grant? Are they still employed by the City?

  • ecogordo

    It appears that there were good intentions. Certainly giving the money to the United Way made sense, but by doing that someone must of thought no one had to manage the overall project under the guidelines that HUD had required. Bad decisions and bad management go hand in hand. It takes more than having a “good” mayor, it takes skill, determination and professionalism to make things work properly. Unfortunately, elections probably won’t make things right for the future. Transparency will help and a dedicated and engaged citizenry.

  • Smiley

    My property taxes,
    Which I pay through my tears,
    Will cover this screw up,
    In four-hundred and eleven years.

    • ushanellore

      That cheered me up no end–sorry, I was laughing through your tears–I imagined your face smiling, Smiley, as tears came streaming down your cheeks. A scruffy effigy of SRB lurked in your hand.

  • davethesuave

    Regime change needed immediately, for sure. But as you imply, the status quo just has to go. Of course, the Republicans suck just as much as the Dems.

    But surprising change can, and does, happen: sorry this is OT, but I never thought I would have seen serious discussion of cannabis legalization in my lifetime, yet, right here in this morning’s Sunpaper, a Michael Dresser article revealing a few tidbits from the State Senate hearing yesterday, during which the “Annapolis Police Chief…asserted that 37 people had died of marijuana overdoses on the first day of legalization in Colorado last month” (an on-line hoax). “The claim drew groans from the packed hearing room”.

    One more quote from the hearing: “The only people I’ve seen overdose on marijuana had a big snack and fell asleep”. Who said it? A long-haired hippie freak? A disciple of the life-affirming benefits of ganja as espoused by Bob Marley? Nope. That quote is from Nancy Jacobs, a “Harford County Republican”.
    Hey, now that I think on it, maybe “a middle-of-the-road Republican as Mayor” isn’t so far-fetched. Could we do any worse?

    • River Mud

      A change in party brings one good thing for sure: the swing of the pendulum. Some things will get worse, then others will get better. The next round of Democrats would be (I’d hope) much stronger than what we are living through right now. Eventually, the pendulum would swing back again. 1-party rule doesn’t help anyone, even the people it purports to help.

  • ushanellore

    From the mouth of Kahlil Gibran–“Not Fair!”

  • Smiley

    Honestly, I don’t care if the next mayor is a registered Monarchist–just bring me someone who actually loves Baltimore and respects our children and taxpayers. Is that too much to ask?

    • Matthew Riesner

      Smiley for Mayor!

  • lanas

    I agree that audits are needed. I am glad it happened. Now we know (a whole hellava lot more). I am curious though, where are our priorities when we provide this level of scrutiny to homeless service grants…but nothing to multi-million dollar federal grants to build a canal bridge to ritchey-rich’s island or ‘repurpose’ community center money to fix a race track? Where is USDOT’s OIG? Is it because conservative ire claims (disingenuously) that helping the homeless must be a scam? Sunlight is good, but apparently some sunlight is more equal than others.

    • christina flowers

      Join 1010am each wed 12 to 1 and fri 2 to 3 to hear all issues

    • ushanellore

      You point out something very important here. Yes, the grants for the homeless and food stamps and programs for the poor do take the brunt of the scrutiny.

      In the Republican ecosystem the poor are suspect, leeching off the govt. if not plotting to do so. But the poor I know are the ones who’ve wasted building this country. They have slaved in restaurants and farms in knee deep water, they have fixed our roads and our machines and they have worked at risky jobs like the steel industry and have been thrown out without benefits, worn out and body broken.

      The homeless are no longer just the abjectly poor or the chronically unemployed or drug addicted. They are often the regular face of America–worked to death, mired in mind numbing routine with no break or entertainment before they went kaput because the CEO of their printing company or their catering place or their machine shop sold them out or simply shut down without offering them benefits, after eating up their retirement.

      The hiatus between Medicare’s arrival and the loss of their health insurance is the most excruciating for these people especially if fate foists an illness on them during this down time.

      Yes, lanas, we’re all too eager for accountability from those programs to help the poor and are too lax to demand the same level of scrutiny for programs like those administered by DOTs across the land, often putty in the hands of no bid contractors who are no more than racketeers, a whole bunch, quite adept at taking govt. to the cleaners by delaying and adding on to the budget of given projects.

      The answer is not to let the agencies that work for the poor go free. The answer is to set the same standard of scrutiny for all govt. agencies and the answer is enforcement of those standards.

      We have to rise up and smite the wastrels down. They make my blood boil that they think so low of the citizens who keep this country running, who pay their salaries, that they dare to underestimate our intelligence and give us glib explanations for how money slipped out of their hands–be it from the DOT or from Medicaid–they make me so angry.

  • Matthew Riesner

    If that were going to happen it would have to be someone of local celebrity stature (a household name). A football player, local business person, well renowned intellectual, movie star, etc. I think someone like Ben Carson would be a good pick for a moderate Republican mayor.

    • Lizzie 58

      Matthew: for goodness sakes, why would you think that a former neurosurgeon, even if he was a good doctor, has any more fiscal or executive ability than our our current or previous mayors– former lawyer (SRB), former teacher (Dixon), former lawyer (O’Malley); former lawyer (Schmoke), etc.

      You may like Dr. Carson for his political messaging, but you know squat about his executive capabilities. Ask any nurse who works in an operating room what they think of most surgeons.

      • ushanellore

        Ben Carson is not looking for small potatoes. He has national aspirations as does our governor as does our current mayor. I predict when the grand finale arrives Dr.Carson will be thankful to be a retired and respectable neurosurgeon.

      • Matthew Riesner

        Lawyer, lawyer, lawyer…maybe one of the problems is that we have people of too few backgrounds. What lawyers are good at is using precedence to win an arguement but when the precedence is failure, we end up doing the same thing over and over again and getting the same results…failure. It doesn’t matter if it’s Ben Carson, a guy who sells car, a banker, an accountant, a garbage collector, a professor, a retired police officer, or Mickey Mouse, we need a more diverse government including more diversity in people’s political ideologies and past experiences. Single party rule and having the same background works for the PRC but is bad for the City of Baltimore.

    • Lizzie 58

      P.s. I do not think Ben Carson lives in the City– kind of a requirement if you want to be Mayor.

    • davethesuave

      I would vote for any open-minded hemp-growing organic farmer. Sorta like Geo. Washington. About as tall too.

  • ushanellore

    The masters

    They are obsessive and also compulsive,
    They make their talent a habit,
    They practice, practice, practice,
    They don’t retreat because they’re rattled
    by critics and ego battles.

    Look at your irregular rhymes–“canned” and “in advance”, “Gibson” and “Gibran”–you’ve got the fundamentals. The rest of course is interest and if you are having fun with the ability.

  • Carol Ott

    Just remember who voted for audits and who shot the idea down.. Vote accordingly or enjoy living in the bubble of dumb. “It’s really simple”, says the registered Republican.

  • christina flowers

    When does it stop…who next to suffer at the hands of individuals greed..1-83 was just the beginning for belvedere….

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