sr-071409-1ji ®®®®g~ i r
City Of ~t ~JB®®~I
Santa Monica
City Counci! and Housing Authority Board iVieeting: July ~4, 2009
Agenda Item: e-'S
To: Mayor and City Council
Chair and Housing Authority Members
From: Andy Agle, Director of Housing and Economic Development
Barbara Stinchfield, Director of Community and Cultural Services
Subject: Licensed Clinical Social Worker and Fraud Investigation Services
Recommended Action
Staff recommends that:
The Housing Authority Board authorize the Executive Director to negotiate and
execute a professional services contract for the Housing Authority with Program
Compliance Solutions to provide fraud investigation services for the Housing
Authority, in an amount not to exceed $218,400.($72,800 annually) for athree-
year contract.
The Housing Authority Board and 'City Council authorize the Executive
Director/City Manager to negotiate and execute a professional services contract
to provide clinical support for the Housing Authority and the Human Services
Division with Ms. Dorothy Berndt, LCSW, in an amount not to exceed $237,057
($78,019 annually) for athree-year contract.
Executive Summary
The Housing Authority and the Human Services Division utilize the services of a
Licensed Clinical Social Worker (LCSW) to assess the clinical needs of homeless,
senior and disabled households and coordinate care, stabilize persons needing housing
and to keep persons "at risk" housed. The target populations and service needs overlap
those served by the Housing Authority and Human Services Division. The proposed
LCSW annual contract for The Housing Authority and. the Human Services Division will
not exceed $78,019 and may be renewed for two additional one-year terms.
The Housing Authority is required by the U.S. Department of Housing and Urban
Development (HUD) to investigate potential fraudulent activity of persons participating in
federal programs, including the Section 8 Housing Choice Voucher, Family Self
Sufficiency, Shelter Plus Care and other programs. The programs have regulatory
eligibility regarding income and asset limitations. The Housing Authority is also required
to seek restitution if fraud is discovered. The annual fraud investigation contract for the
Housing Authority will not exceed $72,800 and may be renewed for two additional
terms.
Background
The LCSW service is a pivotal component to the success of Housing Authority
programs and homeless initiatives under the City's adopted "Action Plan to Address
Homelessness", including Shelter Plus Care, Family Self-Sufficiency, Section 8 Housing
Choice Voucher, Redevelopment Agency Housing Assistance, HOME, the Chronic
Homeless Program Service Registry, and the Support Intensive Program (formerly the
Serial Inebriate Program) to engage and stabilize homeless and disabled residents of
Santa Monica. The service is a keystone to outreach and service connection to other
mainstream services.
As the primary funder of the Section 8 Housing Choice Voucher program, HUD requires
fraud investigation and restitution as factors for evaluating the City's administration of
this program. The Housing Authority recovers approximately $75,000 annually from
fraud-related activities. The Housing Authority does not have sufficient staffing capacity
to provide in-house investigation services. Due to the nature of the work, it is also
preferable to use athird-party contractor with documentation that is indisputable and
unbiased.
Discussion
The Housing Authority and Human Services Division collaborate to provide the needed
support to work. with disenfranchised populations struggling to obtain and sustain
affordable housing and remain in Santa Monica. Those include persons who are
chronically homeless, physically and mentally disabled, and seniors. The LCSW reviews
documentation of disability and homeless status to assure eligibility to the different
programs, is deployed by staff to conduct assessments in the field, connects recipients
to other mainstream services and assures appropriate treatment, and provides technical
clinical training and support to contracted service providers and staff. Many households
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who are marginally stabilized in the community would likely become homeless or
require high cost services without the LCSW support. Contracting for this service is the
most cost efficient way to work with this challenging population.
Fraud investigation is triggered when a discrepancy is discovered or reported to the
Housing Authority involving federally funded rental assistance programs. Most of the
fraud activity is related to unreported income that is discovered on recipients' records
through required third party verifications provided by HUD. Once a recipient is issued a
voucher and secures housing, their income and assets are reviewed and recertified
annually by staff. Staff refers potential fraud cases to the investigator who then
interviews the applicant/recipient and other persons who are relevant to the case and
gathers all available documentation to determine if a recipient gave false information to
secure or sustain a housing voucher. Other investigations include disposition of assets
for the purpose of eligibility, leased housing units that are not occupied by the recipient,
and household members who reside in a unit and are not properly reported. At the
Housing Authority's direction, the investigator may negotiate with the individual to make
repayment agreements. Absent investigations, fraud activity would likely increase and
thereby reduce the number of eligible low-income households receiving assistance
through the Section 8 program.
Contractor/Consultant Selection
A request for qualifications for professional services was posted on the City of Santa
Monica website to provide licensed clinical social worker support for an annual contract
that can be extended for two additional one-year terms. Two responses were received
from the Covenant People, Inc. and Ms. Dorothy Berndt. Staff reviewed the submittals
for the LCSW applicants and rated each on qualifications, project understanding,
experience, price and references and has determined that Dorothy Berndt is the most
qualified contractor to support the services of the Housing Authority and the Human
Services Division. Ms. Berndt is recommended based on her knowledge of various
HUD-fuhding sources and regulatory compliance requirements and for her previous five
years of experience working with City staff, local service providers, and program
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participants including persons who are homeless. Ms. Berndt has expertise with the
Los Angeles Department of Mental Health and with the local homeless service providers
who are the main point of service for most of the clients who receive housing and
services in the city. She has specific expertise to determine if disability requirements
have been adequately documented for HUD compliance and if the appropriate care plan
based on that disability is documented and followed. The target population. served is
often the most disenfranchised population who do not seek traditional treatment in an
office setting. The other submission did not speak to outreach or working with this
population in a non-traditional treatment setting while Ms. Berndt's submission
addressed non-traditional settings and challenging populations. Ms. Berndt has been
providing the proposed services to both the Human Services and Housing Authority
under separate contracts over the past five years.
A request for qualifications for professional services was posted on the City of Santa
Monica website to provide fraud investigation services for an annual contract that can
be extended for up to three years. Staff reviewed the. submittals and rated each on
qualifications, project understanding, experience, price and references and has
determined that Program Compliance Solutions is the most qualified contractor to
support the services of the Housing Authority. Responses were received from
Sotomayor & Associates LLP, Stovefield Josephson, Inc., and Program Compliance
Solutions. Mr. Douglas Eaton, Principal of Program Compliance Solutions (PCS), has
extensive familiarity with the City of Santa .Monica. Mr. Eaton has been providing
services to four other Housing Authorities for the past ten years and is very
knowledgeable regarding Housing Authority programs and the regulatory compliance
applications. Mr. Eaton was a police officer for 9 years with the City and worked as a
District Attorney Investigator for 24 years. Mr. Eaton has been successfully providing
services to the Housing Authority and recovered fraudulently obtained funds totaling
$395,000 under a previous contract. Mr. Eaton's hourly rate is more competitive than
the other applicants.
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Financial Impacts & Budget Actions
Funds for the clinical support professional services contract are budgeted in account
012628.561402 ($44,460) for the Human Services Division and in 01264.555060
subledger 74138 ($33,559) for the Housing Authority. Funds for the fraud investigation
professional services contract are budgeted in account 01264.555060 subledger 74138
for the Housing Authority.
Prepared by: Barbara Collins, Housing Manager
Approved:
Andy Agle, Director
Housing and Economic Development
Forwarded to the City Council and
Housing Authority Board:
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P. L nt Ewell
Executive Director
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Reference Contract Nos.
9091 (CCS/HAS) &
9092 (CCS/HAS).