Montgomery Department Faulted on 4 Contracts

Montgomery County's Department of Health and Human Services paid $137,700 to a consulting firm without proof that any work was done on four contracts, according to a report by the county's inspector general.

Under one contract, Columbia-based Health Management Consultants abandoned a project to set up a system for adult casework after being paid $37,077 in advance. The company did not repay the county, the report says.

Under three other contracts, the report says, the county paid the company a total of $100,000 for consulting services and a customer survey, but county and company files have no documentation that proves the company did the work.

The report is the second recent indication of problems at the agency. A few months ago, a Health and Human Services employee pleaded guilty in a criminal case and agreed to pay restitution after he was accused of skimming $61,770 in county funds to buy a house.

The inspector general's analysis of the contracts with Health Management Consultants found that the four payments to the company appear to have been hastily processed at the end of the 2005, 2006 and 2007 fiscal years to ensure that funds were spent and would not have to be returned to the county or state treasuries. The county's budget for the Health and Human Services Department is about $272 million annually.

"The process was described to us as 'sleight of hand' with the right intention," says the report by Assistant Inspector General Charles H. Becker. Becker, however, did not concur, saying his efforts to track the spending were hampered by a lack of documents from the county and the company.

County and company officials spent several months searching for documents to prove the company did what it was paid to do, but they could find only a draft of one report required by one of the four contracts, Becker wrote.

The payments in question were made over a 24-month period during which Health Management Consultants held contracts with the county for at least $400,000, according to county records. Three of the payments were made during the administration of former county executive Douglas M. Duncan (D). The fourth payment, for advising two nonprofit agencies that provide social services for the county, was made during the administration of the incumbent county executive, Isiah Leggett (D), for work the consultants and county officials said was done during the Duncan administration.

William Atkins, executive vice president of Health Management Consultants, whom Becker interviewed during his investigation, did not return repeated phone calls from The Washington Post seeking comment. Nor did the company's president, Mildred Brooke, who public records show is married to Atkins.

Uma Ahluwalia, appointed by Leggett last year to head the Health and Human Services Department, said she thinks the four contracts are "isolated problems" but is awaiting further review. "This started in the previous administration and we got caught up in it," she said. "There are a number of strategies in place on our part to correct this."

Ahluwalia would not say whether anyone had been fired or reassigned. In a letter to Inspector General Thomas J. Dagley concurring with Becker's finding, Ahluwalia said that two county employees who had been involved in the contracts had left and that her office is trying to assess "appropriate action for other staff that remain with the county and were involved with these payments." She said her office was consulting with County Attorney Leon Rodriguez before deciding whether the county should seek refunds from Health Management Consultants.

According to the report, Atkins told Becker that under one of the contracts, the county paid $25,000 for a customer survey as the end of the fiscal year approached because "grant monies used to fund the project needed to be committed and the work was supposed to be done prior to the end of the fiscal year. . . . It was [Atkins's] understanding that if the money was not spent by the end of the fiscal year it would have gone back to the state and no longer be available." No final copy of the survey could be located, the report says.