The group that runs the D.C. General shelter overbilled the city for services last year.
The group that runs the D.C. General shelter overbilled the city for services last year.

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After a city audit released last week revealed that the organization overseeing D.C.’s homeless services overbilled the District by more than $5 million last year, the director of the D.C. Department of Human Services is promising to make changes and assess the group’s accounting process as part of a comprehensive review of its contract.

The Community Partnership for the Prevention of Homelessness, which has coordinated the city’s homeless services since 1994 and run the troubled D.C. General shelter since 2010, charged the city $5.4 million more than it spent last year, due to unusual billing practices that violated D.C. law, according to the report from D.C. Auditor Kathy Patterson. Human Services Director Laura Zeilinger says her department, which contracts with TCP, was not taken fully by surprise by the audit.

“There were folks at DHS who had flagged these issues and were taking steps to correct them,” says Zeilinger, who took over the department earlier this year. “I personally was not aware of the extent of the issues.”

Zeilinger emphasizes that the audit did not imply any misspending of funds on TCP’s part, but rather just improper billing practices. “There were [DHS] staff that were aware that the billing and payment process needed to be changed and had taken steps to change it, but I don’t think that anyone was fully aware of the degree to which there was an overpayment” or that the process violated the law, she says.

That said, the billing practices “absolutely are not alright, and they need to change,” Zeilinger says.

Even if TCP didn’t misspend funds, the overbilling allowed the organization to collect a higher management fee from the city than was allowed. According to the audit, TCP’s fee was more than $150,000 over the amount that would have been allowed had TCP billed the correct sum.

As part of the audit, DHS tried to justify the billing structure to Patterson, saying that in order to protect TCP from potential cash-flow issues, “DHS allows TCP to invoice monthly to cover such expenses. It is not an estimated bill, but an anticipated bill based on past and current expenditure levels.”

Before the audit, TCP had already come under scrutiny for its management of D.C. General under a $13 million annual contract, particularly after an 8-year-old girl was abducted from the shelter a year ago, apparently by a shelter janitor who had had an inappropriate degree of contact with her. There were also complaints about other efforts by TCP under its $71 million overall contract to run the city’s homeless services. Some residents receiving a housing subsidy say they have faced eviction after TCP failed to pay its portion of the rent.

In keeping with her practice of ordering “top-to-bottom” reviews of nearly all the city’s plans and contracts, Mayor Muriel Bowser has ordered a top-to-bottom review of TCP’s contract. This review, requested prior to the audit and now underway, will examine TCP’s billing issues, according to Zeilinger. But she says DHS is likely to address some of the issues before the review is complete. “We’re not going to wait to finish the review to correct some of the problems that have come to light,” she says.

Photo by Darrow Montgomery