County owes DCED $215K
SUNBURY - Northumberland County commissioners were officially notified Wednesday that the county must pay back approximately $215,000 in grant money received from the U.S. Department of Housing and Urban Development (HUD) for the county's Homelessness Prevention and Rapid Rehousing (HPRP) Program for failing to provide proper documentation to determine client eligibility for homeless status.
The repayment request by the state Department of Community and Economic Development (DCED), which has been anticipated by county officials for several months, prompted different reactions from the three commissioners, including a claim by Stephen Bridy that the issue involves "political gamesmanship" by DCED officials.
In a nine-page letter dated Jan. 7 and received by the commissioners Wednesday, DCED grant manager Beverly A. Hutzel states, "The county will be required to remit to the U.S. Department of Housing and Urban Development $215,150.66, which is the amount determined to be ineligible due to lack of supporting documentation on income eligibility and housing status. The county will have 30 days or no later than Feb. 7 to provide additional documentation to support the ineligible client costs. However, if the county cannot provide the required information, then the county will need to provide to DCED a reasonable
expected time frame for the payment of ineligible costs."
Hutzel said the HPRP grant totaled $365,361. She said the $215,150.66 must be repaid as follows:
- Case management/salaries: $53,899.65.
- Administration: $4,561.56.
- Data collection: $19,992.92.
- Financial assistance payments: $133,155.53.
- Excess cash remaining in bank account: $3,541.
In a press release issued Wednesday afternoon, Commissioner Vinny Clausi stated, "I said at the time the last board of commissioners were considering approving this grant that it would wind up costing us money. That's why I was opposed to it from the get go and continued to oppose it, but the two other commissioners (Kurt Masser and Frank Sawicki) approved it and outvoted me."
The funds actually came from HUD, a federal agency that passed the money onto the states. In Pennsylvania, the money went to DCED to distribute to local governments.
Clausi blamed DCED from the outset for failing to provide any firm guidelines or regular oversight over the administering of funds by local governments.
Bridy, who said he has been in contact with officials from HUD, stated, "This is a game of political gamesmanship by officials at DCED directed towards Northumberland County, and an effort by DCED to pass on their own ineptitude and incompetence onto the local governments."
Bridy claimed HUD officials had no idea that money was being requested by DCED to be repaid.
The commissioner also claimed HUD officials told him that the federal agency incurred many challenges. "They told me it was a lot of money and they had to act quickly," Bridy said. "Given the emergency nature of the funds, which were part of a federal stimulus package, HUD allowed for a high level of discretion in the implementation of guidelines by local governments."
Bridy said DCED officials have informed the county that negotiating partial payment of overdue bills on behalf of distressed citizens was not permitted, while he said HUD officials indicated that they "encouraged" local officials to negotiate and make partial payments so more money would be available for others in distress.
Clausi and Bridy said they plan on fighting the repayment of $215,150.66 by taking the matter "over the heads of DCED officials" to HUD, while working closely with state and federal representatives.
Shoch has repeatedly criticized Clausi for not making his fellow commissioners aware of the DCED issue until the latter part of last year after knowing there was a problem in February. On Wednesday, he referred to the allegations leveled against DCED by Bridy and Clausi as being "ridiculous."
"They are grasping at straws," Shoch said. "Even now, they are still denying we owe the money and continue to point fingers at other people while trying to shift the blame. From the conversations I've had with state and federal officials, I believe DCED and HUD are on the same page in how this was handled. Vinny knew about the problem in February. All but $18,000 was fixable at one point, but we ran out of time to pay it back."
Shoch said it's his understanding that an e-mail will be sent by HUD to the county in the next few days that will update the status of the repayment of the grant money.
The commissioner also pointed out that Hutzel indicated in her letter that the majority of counties administering HPRP funds were successful in documenting basic elements involved in the program.
Hutzel said an on-site monitoring review was conducted on the county's HPRP Program on July 30, 2012, at the county planning department office. At that time, she said she and M.J. Smith of DCED met with county adult social services director Gregg Stavinski, planning director Pat Mack and grants manager Kathy Jeremiah.
Prior to the on-site review, DCED staff conducted desk audits requiring grantees to submit supporting documentation to support a draw down request of grant funds. Hutzel said during the second request for information in January 2012, and upon review of the information, it became apparent that there were significant issues due to inadequate documentation being maintained to support program costs.
A conference took place Jan. 31 in which Smith and Hutzel expressed concerns that the county did not have documentation to support the program requirements which could result in ineligible costs. Specifically, Hutzel said the county was not obtaining lease information to determine client eligibility for homeless status.
Hutzel said a letter was forwarded to DCED on April 18 from Shoch stating the county was electing to close its HPRP Program immediately and the county would not be drawing down additional HPRP funds. The letter also stated that any remaining funds allocated to the county may be disencumbered by DCED.
Hutzel said DCED commended the county for closing the program since it limited the county's liability for any additional repayment of ineligible HPRP costs.
As a result of the on-site performance review, it was apparent that the files generally lacked documentation to support the program requirements. Detailed guidance was provided to staff on the type of information needed in each file to ensure that each client receiving assistance met the household income eligibility requirements and homeless status as required in the HPRP notice.
Hutzel said DCED agreed to review the information gathered by county staff, who forwarded 133 participant files. There were additional client files that were not forwarded for review because county staff made the determination that these clients did not meet the requirements of the program. In an effort to be fair to the county, DCED only required that the county repay only actual ineligible costs.
Hutzel acknowledged in her letter that the HPRP Program is very complicated to administer, but noted DCED provides detailed guidance in the form of alerts, updates and statewide webinars to educate grantees.
Last month, Shoch and Mack said the county was continuing to cooperate with DCED in paying back the money and said an appeal seemed unlikely.
Shoch said he was informed HUD has been demanding money from DCED since a Nov. 11 deadline.
The county was eligible for approximately $365,000 in funding, and county Adult Social Services and the planning department received $291,829.47 between 2010 and 2012 to distribute to low-income families, according to Mack.
Of that $291,829.47, the county used $170,254.14 - $102,468.96 in 2010, $60,945.18 in 2011, and $4,840 in 2012, he said.