The U.S. Department of Justice this week released a 96-page report that raises concerns over how the city managed its Weed and Seed grants. The report finds that officials might have misspent funds and improperly recorded expenses.
Between 2007 and 2010, the Office of Justice Programs awarded Atlanta $1.1 million in federal cash to help reduce crime and invest resources in troubled neighborhoods including Mechanicsville, Pittsburgh, English Avenue, and Vine City.
As part of the grant, Atlanta was expected to monitor how its Weed and Seed program functions, including its finances. But the DOJ's audit showed otherwise. City officials allegedly dragged their feet when asked to provide documents for the audit. In some cases, they simply ignored requests for information.
"Most of the documents we requested in advance were not provided for weeks or months," the report says. "Some records were never provided. Over the course of the audit we followed up multiple times with phone calls and e-mails, but the city's Weed and Seed Director sometimes did not respond to us for weeks or provided incomplete or incorrect information. Some of our questions pertaining to a payment to a former city employee were never answered."
City officials eventually handed over some requested documents, explaining that "the e-mail did not go through." After two years, DOJ officials released their audit and found that the program:
- paid grant expenses without detailed invoices, such as four invoices totaling $31,847 that were billed as "reimbursement for teen court," three invoices totaling $20,272 ($7,687, $7,687, and $4,898) that were billed as "consulting," but did not include the consultants' hours or rates, and other similar expenses;
- did not adequately review invoices, which resulted in the city overpaying one invoice by $11,660;
- made advance payments to contractors and other sub-recipients, but did not account for how all the advanced funds were spent, including a $20,000 advance payment of which $3,084 is unaccounted for;
- made advance payments to contractors and other sub-recipients, but did not ensure the city received or used the goods or services that were paid for, including a $12,300 advance payment for rent for a period of 1 year after the grant ended and a $3,000 advance payment to publish newsletters for a period of 2 years after the grant ended;
- paid for grant projects that were not completed, including $2,200 reimbursed to a contractor for "expenses incurred for a parent patrol initiative," which was not completed because of a lack of community support;
- made duplicate payments totaling $7,904 ($7,300 and $604);
- was billed twice for $7,700 for neighborhood coordinator salaries for the months of November and December 2009 and recorded one invoice as a grant expenditure and the other invoice as a matching cost transaction;
- miscategorized expenses, which made them appear allowable;
- did not comply with the grant budgets approved by OJP;
- charged $338,790 in grant expenditures (62.9 percent of the grant expenditures we tested) to "Service Grants" expense, which was not an approved budget category and is therefore unallowable;
- charged $117,306 in other unallowable costs to the grants;
- charged $29,837 to the grants for costs that are not supported by adequate documentation such as original receipts and invoices, timesheets, public announcements, meeting agendas, sign-in logs, or other documents; did not use $48,125 in grant funds from six grants, including $38,189 from one grant that was not used because the city failed to meet the deadline for requesting reimbursement for the grant expenses;
- did not provide, or could not show that it had provided, $24,659 in grant matching costs;
- did not meet, or could not show that it met, 9 of 31 grant goals, accomplishments, or other performance measures we tested; and
- did not monitor and did not have adequate procedures for monitoring contractors and other sub-recipients to ensure they met the fiscal and programmatic requirements of the grants and were on track to meet grant goals. The monitoring requirement is explained in the OJP Financial Guide.
The DOJ concluded that Atlanta "did not have or did not follow internal controls" and calls for stricter procedures to document future expenditures and make sure proper bookkeeping occurs.
In a statement, Mayor Kasim Reed's office said it has already responded to DOJ officials about the audit and acknowledged there "might have been some discrepancies" regarding the city's use of around $75,000. Spokesman Carlos Campos says the city remains committed to reconciling any discrepancies and wants to ensure the grant guidelines were properly followed. The city plans to move its audit operations to the Office of Grant Compliance, which is a part of the Department of Finance, for further supervision. The statement also notes that the alleged accounting missteps took place before Reed took office.
"The City of Atlanta takes the findings of a U.S. Department of Justice audit regarding possible mismanagement of grant funds in its "Weed and Seed" program very seriously...We remain committed to working with our federal partner," Campos said in the statement.
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