If you think the appointment of the control board means that the feds will stop checking on the District government’s fishy numbers, think again. According to sources in the General Accounting Office (GAO), the agency’s Office of Special Investigations is probing possible criminal activities at the D.C. Public Schools (DCPS), Department of Administrative Services (DAS), and Department of Human Services (DHS). Washington City Paper has also learned that DHS is the target of a separate investigation by the U.S. Attorney’s office.
These new inquiries follow on the heels of two other, unrelated investigations of city wrongdoing. The GAO is already conducting a general study of District finances, and Rep. James Walsh (R-N.Y.) has asked the Department of Justice to determine whether any city official should be prosecuted for violating the Anti-Deficiency Act, a federal law prohibiting government overspending.
“Some aspects center on fraud, mismanagement, abuse, and wrongdoing,” says one GAO agent of the DCPS, DAS, and DHS investigations. “So many problems are coming to light.”
D.C. government sources confirm that GAO agents have interviewed D.C. councilmembers, council staff, and a variety of administrators, including Auditor Russell Smith. Smith could not be reached for comment.
At DHS, investigators are reportedly examining contracting at the Mental Health Commission, particularly allegations that administrators have been recording overtime for work not actually performed. DHS workers have also been accused of coercing contractors into hiring relatives of government employees, say DHS sources familiar with the probe.
Kevin Ohlson, spokesman for U.S. Attorney Eric Holder, confirmed that his office is exploring allegations against Paul Sims, a former employeee with DHS’s Commission on Public Health. Sims resigned when the investigation began last year. The inquiry is targeting other DHS employees, sources say.
“We have received subpoenas from [the U.S. Attorney’s Office] to turn over records,” says a high-level DHS administrator. “We are expecting something to happen this week.”
GAO is also aiming its inquiries at the District’s troubled school system. Sources inside DCPS say that the GAO is delving into a school building maintenance contract between the schools and Service Masters, a Chicago-based firm. The contract, which is worth nearly $30 million over five years, has been controversial almost from the time it was awarded in 1992. Under the terms of the agreement, Service Masters is paid to manage the school system’s custodians, says DCPS spokeswoman Beverly Lofton.
Lofton confirms that the feds are sniffing around DCPS, but denies that the Service Masters contract is the subject of the investigation.“We have been notified about this [inquiry]…but we don’t think this particular contract has been targeted,” she says.
It’s unclear what stage the investigations have reached, but one GAO staffer says the agency is submitting regular reports to the two House committees overseeing District affairs.