Officials Apparently Overpaid Nonprofit

Billing Probe Continues, but Group That Helps Latinos Risks Funding, Letter Says

Montgomery County officials acknowledged in a report yesterday that they appear to have overpaid Centro Familia, a nonprofit organization serving low-income Latino children and their families, as the county's inspector general continues his probe of more than $900,000 in county payments to the Wheaton agency.

Chief Administrative Officer Timothy Firestine says in a letter to the inspector general that Centro Familia risks losing its funding or might have to repay the county because it has had difficulty documenting an unspecified amount of spending for activities "outside the country [and] information technology-related activities." Firestine's letter also says the county government found "compelling" assertions by the inspector general that Centro Familia might have had "conflicts of interest and potential erroneous billings."

The report updates county officials on an ongoing investigation of county Department of Health and Human Services billing and procurement practices. The report is part of the fifth examination by the inspector general of HHS practices. The department's $272 million annual budget accounts for a substantial portion of the county's $4 billion budget, and a large chunk goes to contractors.

In February, the county was billed $42,000 by Centro Familia, but the county rejected about $11,000 of that. The nonprofit group then revised its invoice to seek about $36,000, and the county rejected about $6,000, said Uma Ahluwalia, director of the county's HHS department.

In an interview, Firestine cautioned that the county is still collecting information from Centro Familia. Centro Familia has an annual budget of $700,000, much of it government grants. About $450,000 comes from Montgomery.

"We are not trying to put Centro Familia out of business," he said, adding that the county was partly at fault for not requesting more documentation from the nonprofit agency in recent years.

Centro Familia officials denied any wrongdoing and said the organization has been unfairly singled out by the inspector general.

David Anderson, chairman of Centro Familia's board, said the organization had been slow in providing documentation but that "no fraud or abuse has occurred." He said he believed that Centro Familia eventually will get the funds the county has withheld. "We have a model program that is nationally recognized," he said.

The organization offers an early childhood program to about 30 preschoolers and has trained more than 300 in-home child care providers for children, many of them Latino.

Firestine's assessment outlining the possible loss of funding was included in a report to the County Council by Inspector General Thomas J. Dagley updating officials about findings earlier this year that there were irregularities by the county and Centro Familia in billing practices for fiscal 2007 and fiscal 2008. Further analysis during March and April, Dagley said, "verified the conditions" in the report.

The report cited 32 specific expenditures still being questioned.

"Based on records provided by Centro Familia for our analysis, we found internal control deficiencies, misclassifications, discrepancies and/or errors for transactions involving employee loans, printing, information technology and travel.