By Debbie Cenziper
Washington Post Staff Writer
Saturday, October 17, 2009 6:47 PM
In a city ravaged by the highest rate of AIDS cases in the nation, the D.C. Health Department paid millions to nonprofit groups that delivered substandard services or failed to account for any work at all, even as sick people searched for care or died waiting.
More than $1 million in AIDS money went to a housing group whose ailing boarders sometimes struggled without electricity, gas or food. A supervisor said she was ordered to create records for ghost employees.
About $400,000 was paid to a nonprofit organization, launched by a man who once ran one of the District's largest cocaine rings, for a promised job-training center that has never opened.
More than $500,000 was earmarked for a housing program whose executive director had a string of convictions for theft, drugs and forgery. After the D.C. Inspector General's Office could find no evidence that he was operating an AIDS nonprofit group, the city terminated the grant but never sought repayment.
All told, the Health Department's HIV/AIDS Administration awarded more than $25 million from 2004 to 2008 to nonprofit agencies marked by questionable spending, a lack of clients, or lapses in record-keeping and care, a 10-month Washington Post investigation found. Many of the groups have since closed or are no longer providing AIDS services.
Across the city, the sick are suffering.
Renee Paige, 50, once threw birthday parties for her two daughters in her apartment in Southeast Washington, where she'd cook beef stew for elderly neighbors and always had bus fare for a friend. But AIDS and two bouts of pneumonia had left her weak, homeless and unable to care for herself.
She came to a community meeting in April after spending the night on a park bench in heavy rain, with no place to go.
"I have AIDS," she told the group, "and I am soaking wet."
Weeks later, she died alone, on the bench, one mile from the HIV/AIDS Administration and within two miles of a dozen nonprofit groups that help people with AIDS.
"I couldn't understand," said Keena Stewart, who had known Paige for 15 years. "How could she die like that?"
More than 15,000 people have HIV or AIDS in the District, 3 percent of the population older than 12. For black men, the rate is more than double, at 6.5 percent -- one of every 15 people.
The disease has spread so fast, to every corner of the capital, that health officials call it a "modern epidemic." The District's AIDS rate is higher than that of some countries in West Africa.
Twenty-five years ago, the District was on the forefront of the fight against the disease. City leaders created a government-funded AIDS office and began to pour tens of millions of dollars into a network of local groups that promised critical frontline support.
Early on, the District focused on white gay men in more affluent areas. In recent years, however, city officials have pushed to support community-based groups in poorer neighborhoods that had traditionally been underserved by AIDS agencies.
But the program morphed into something of a free-for-all among many nonprofit groups, enabled by a city agency that routinely gave out money but failed to ensure the funds were used to help people with the disease.
The waste has spanned every arm of the HIV/AIDS Administration. As the steward of the city's AIDS dollars, the agency receives about $100 million a year, largely from the federal government, for prevention, medical care, housing, case management and support services. Much of the money goes to large medical clinics.
From 2004 to 2008, about $16 million a year was divided among 90 small nonprofit groups.
More than 20 failed to file tax returns or secure a city business license, The Post found. Some groups submitted employee résumés and consulting contracts with false information, including fake addresses and credentials. Others had a history of financial problems or had spent hundreds of thousands of dollars on travel or executive pay. One Northeast nonprofit group paid its executive director $357,000 in salary and benefits at a time when it was cutting back services.
In all, one dollar of every three went to groups with identified deficiencies.
Grants were given for vague reasons, and the results were often not tracked. Monitors at the city's HIV/AIDS Administration were supposed to provide oversight, but inspections were sporadic and often done by phone. Records show that monitors frequently focused on whether the groups had spent enough of their grant money -- not whether the spending was legitimate.
Four of the most troubled groups were funded during the tenure of former HIV/AIDS Administration housing chief Debra Rowe, who allowed grant money to flow even after her staff chronicled deficiencies, records show.
The executive director of one of the groups -- awarded about $4.5 million in recent years -- had hired Rowe's son. The director also gave work to her father and uncle at a nightclub that he ran next door to his nonprofit group.
"Everybody knew if you needed anything down at the AIDS agency, call Debra," said Ron Harris, a local AIDS case manager. "There was all this money coming into the city, and she was on the ground floor."
Rowe, 50, insisted that she did not favor groups or benefit personally. She said she had little to do with doling out grants. The process, she said, was mainly handled by independent reviewers who ranked applications based on such criteria as program outcomes and capacity.
Rowe, who drew $97,000 a year at the helm of the housing program, said she tried to close one organization and raised concerns about another but was overruled by her supervisors at the Health Department, an accusation that city officials deny.
"I have always worked hard on behalf of people with AIDS and HIV," she said. "A lot of the people talking behind my back were just envious. I have been innovative in HIV prevention."
Two HIV/AIDS Administration officials with direct knowledge said department heads such as Rowe supervise the selection process and weigh in heavily with recommendations.
In late 2006, the FBI quietly began an investigation into the city's AIDS program, Rowe's ties to groups and the actions of other officials involved in funding decisions. Rowe and her attorney said the investigation was recently closed.
An FBI supervisor, however, said the investigation remains active.
"Waste and abuse in health-care fraud victimizes the vulnerable and takes away funding from legitimate agencies," said FBI Supervisory Special Agent Darlene G. Hoyns, whose health-care fraud squad investigates abuse in the District for the bureau's Washington field office. "I ask anyone who believes they may have information pertinent to this investigation . . . to reach out to the FBI. . . . Those who misuse public funds should be held accountable."
FBI officials did not divulge details of their investigation. The Post independently analyzed the spending, services and finances of dozens of groups, documenting problems throughout the city.
HIV/AIDS Administration Director Shannon L. Hader, who took over in October 2007, said the agency has improved oversight to track how money is spent. The agency is also performing more thorough site inspections and has tightened the list of AIDS nonprofit groups.
In the past, she said, the agency was seen merely as a source of pass-through funding from the federal government.
"It was like misstep to misstep to misstep," Hader said.
Rowe was removed from her position in April 2008 amid growing criticism that the program was in disarray. But more than a year later, AIDS advocates say the city has done little to hold the problem groups accountable -- or to find out where the money went.
At the same time, nonprofit organizations with better records and more established reputations have struggled through budget cuts to keep pace with the needs of their clients, who have HIV, a viral infection that compromises the immune system, or full-blown AIDS, the follow-on condition that leaves people vulnerable to life-threatening diseases.
On the dingy streets near the downtown bus station, outreach workers scrambled one summer night to hand out condoms and food. They stopped for a 23-year-old who said she trades sex for drugs and sleeps under a bridge on K Street NW. Near a liquor store on Fifth Street NW, they found a homeless man, strung out.
"Are you hungry, baby?" asked treatment adherence specialist Earline Budd, who works for the nonprofit Transgender Health Empowerment group. "Do you want something to snack on? We can help you, okay?"
The nonprofit group wants to expand its drop-in center so homeless clients have a safe place to eat, meet and shower, but there is no money for construction or staff.
Two miles away at the nonprofit Women's Collective, a case manager in June counseled a teenage girl who had just learned she had HIV while Executive Director Pat Nalls put files, condoms and food into moving boxes. The group, which has served hundreds of infected women in the past decade, had to move temporarily into two four-bedroom apartments because it could no longer afford the rent.
"The city has to monitor better and then make a decision on who needs money now," Nalls said. "We have women running around with babies in alleyways. Where are they to go?"'Didn't make sense'
Few groups were cited more by city monitors in recent years than those that provided housing for people with AIDS, funded with money from Rowe's department.
Rowe had rebuilt her life after a troubled past, like others in the city's network of AIDS workers. In 1991, when Rowe was 31, she was convicted for heroin possession and cocaine distribution, serving 15 months in prison. Months after her release, Rowe's husband, who had been convicted in a separate case of felony drug distribution, was shot and killed on U Street NW, records show.
Rowe later received a master's degree from Lincoln University in Pennsylvania and joined the HIV/AIDS Administration in 1999. In 2004, she was promoted to run the $10 million-a-year AIDS housing program, funded by the U.S. Department of Housing and Urban Development.
Rowe said she worked hard to fix a troubled program and had been given high marks in performance appraisals. But on the streets and among AIDS groups, concerns about her spread quickly.
Ten people interviewed by The Post, including AIDS workers and an HIV/AIDS Administration employee, said Rowe seemed especially close to a handful of groups. Longtime AIDS advocate Bobbie Smith said Rowe once called her into the office after taking control of the housing program and asked Smith to write grant proposals for several organizations.
Smith was a member for nearly a decade of the influential Ryan White Planning Council, which determines how federal AIDS dollars are spent in the District. She also had rehabilitated herself after a troubled past; Smith had served prison time for robbery with a dangerous weapon.
Smith said she refused Rowe's request.
"You can't deliberately put money where you want to put it," Smith said.
Rowe denied asking Smith for help with grants, saying Smith was disreputable because of her criminal record.
"Come on," Rowe said. "I wouldn't approach Bobbie about anything."
One nonprofit group cited by Smith and others was Miracle Hands, whose executive director, Cornell Jones, was convicted of running a massive open-air drug market in Northeast Washington in the 1980s. Jones served nine years in prison and started Miracle Hands as a way to help other ex-offenders after he was released. Jones said his group offered badly needed services in the poorest parts of city.
From 2004 to 2008, Miracle Hands was awarded $4.5 million for housing, support services and other programs to help people with HIV or AIDS, including $400,000 for renovations at a job-training center that has never opened. Much of the money came from Rowe's department.
Rowe acknowledged that Jones had put her father and uncle on security detail at D.C. Tunnel, the nightclub that Jones operated next door to the Miracle Hands headquarters on Queens Chapel Road NE. Jones had also hired Rowe's son to work in a Miracle Hands housing program.
Jones, 52, said he did not see a problem with putting Rowe's son the payroll.
"I didn't think it was a conflict, no kind of way," he told The Post.
Rowe also said she did not believe it was wrong to have three family members working for Jones. She said her 28-year-old son started working at Miracle Hands in 2003, a year before she was promoted to housing director at the HIV/AIDS Administration.
During Rowe's tenure, city monitors repeatedly flagged Miracle Hands for missing records, questionable charges and renovation delays.
"The level of risk [Rowe] was taking with those groups didn't make sense," said A. Toni Young, who runs a city-funded AIDS nonprofit organization. "But then again, it kind of did, because you never get caught, or there's no penalty when you do."'We've been cheated'
Four years ago, in an Anacostia neighborhood devastated by AIDS, Sherman Hill promised to coordinate housing for people with AIDS through his nonprofit group, Our Children.
He also had a criminal past. His rap sheet spanned a decade, with convictions for theft, forgery, cocaine possession and drug distribution. A city auditor wrote a warning letter in 2003 to the Health Department describing "disturbing and questionable" practices at a troubled after-school tutoring program that had been run by Our Children, including payments to staff members who could not be identified.
Brown had ties to Rowe; they had met at Lincoln University in the 1990s. Records show that Brown and Rowe had once launched a nonprofit organization for juveniles together; the group never got off the ground.
Brown told The Post that he had encouraged Hill to apply for AIDS money because the city was trying to do business with more community groups. But Brown said he was not involved in Our Children while he was at the city agency. He left that job in October 2005.
"I'm just as confused as the next person as to why he would have me" listed on Our Children's documents, Brown said. "People use my credentials. They think it looks good on their paperwork."
Our Children received a $300,000 grant in January 2005 from the housing department. The group was awarded a grant for $227,000 a year later. Much of the money was to pay rent for people with AIDS in subsidized housing.
In 2005, auditors for the Inspector General's Office, as part of a probe of city AIDS funding, found no signs of an AIDS group during a visit to Our Children's office, located in a house in Southeast.
People who were supposed to have their rent paid by Hill started to complain that their landlords were not getting the money. In January 2006, an e-mail was forwarded to Rowe about one case of nonpayment.
The renter, Ralph Black, told The Post that he had tried to call Our Children to find out where the money was but could not reach anyone.
"I didn't quite know who was working there and who my contact person was," said Black, 56, a former radar technician who has been living with AIDS for several years. "They were supposed to be providing a case manager for housing. My whole first year, I never saw a case manager."
Black's rent was eventually paid.
One month after Rowe was alerted to the rent problem, records show, she approved a request from Our Children for a lump-sum $50,000 advance on the grant money.
In mid-September 2006, the inspector general's auditors returned to Hill's office and again found "no business [was] being conducted."
That same month, HIV/AIDS Administration monitors once more noted that Hill had not paid rent for a client, who now faced eviction. The e-mail was forwarded to Rowe.
D.C. Council member David A. Catania called a hearing in October 2006 to discuss the city's AIDS program and the inspector general's findings. That month, records show, Rowe sent a letter to Hill saying the Our Children's grant would not be continued.
At the hearing, Catania (I-At Large) told the HIV/AIDS Administration: "I want the money back. . . . This is ongoing theft of District taxpayer dollars. . . . We've been cheated."
Our Children has not returned any money, said HIV/AIDS Administration spokesman Michael Kharfen.
The Inspector General's Office continued its probe in late 2006, based on a tip that Our Children had hired ghost employees. Investigators located two of Hill's alleged employees, including Charles Campbell, who acknowledged that he had provided false information on his résumé. The investigators determined that Hill was aware of the false information.
The Post found that Campbell, who was supposed to be paid $18,000, had invented college credentials on his résumé. He could not be reached for comment.
Investigators also found that Hill had submitted false information on his own résumé, listing education credentials identical to Campbell's. But they did not find any evidence that Hill billed the city for people he did not employ.
Investigators were told the AIDS grant money was not awarded based on the résumés, and the U.S. attorney's office declined to prosecute, according to the inspector general's report.
Publicly, the matter was dropped. AIDS advocates years later still have questions about why more wasn't done.
"That's part of the problem in this city: Whose holding people accountable?" said Harris, the AIDS case manager. "Everybody just keeps getting paid. Don't nobody rock the boat."
Rowe told The Post that she never provided preferential treatment to Hill and that the two had met during an AIDS gathering. She said she had tried to get guidance from her supervisors early on about the critical audit of Hill's tutoring program and whether his nonprofit group should be funded. She said grants manager Jonathan Alston had shrugged off her concerns.
Speaking through HIV/AIDS Administration spokesman Kharfen, Alston said Rowe never approached him about the matter.
Said Rowe: "Outright lie."
Alston said he stepped in later, prodding the Inspector General's Office to investigate.
Hill did not respond to repeated calls and letters seeking comment.'Nobody did nothing'
Hill wasn't the only member of his family to receive AIDS funding.
A group run by his estranged wife, Marilyn Hill, began to receive AIDS money about 2004, also from the housing department. All told, Marilyn Hill's group, Hill's Community Residential Support Services, was awarded more than $1 million over five years to provide housing.
City monitors cited staff turnover, deteriorating building conditions, double-billing for salaries and questionable expenses on invoices for jewelry, suede gloves, flowers and a fish tank.
In August 2007, a boarder in a Hill's Community house on Horner Place Southeast called Rowe directly, complaining that there was no staff, no telephone and no food, which can be dangerous to people with AIDS, who are often advised to eat when taking some medications.
Monitor Sherita Grant verified the complaints during a site visit, writing: "This writer is appealing to the management staff to give me some direction on how [the HIV/AIDS Administration] intends to deal with this matter. . . . I suggest . . . that [the nonprofit] be put on a probation period."
Yet money continued to flow.
Rowe told The Post that she had tried to close the program but that Gunther Freehill, another official in HIV/AIDS Administration, had refused.
"Gunther just wasn't engaged. . . . If it would have been my stand-alone decision, I would have closed Hill's," Rowe said.
Rowe could not provide any reports or e-mails to document her efforts to shut down the program. Through HIV/AIDS Administration spokesman Kharfen, Freehill said Rowe never approached him about closing the program.
Marilyn Hill did not respond to calls and letters seeking comment.
This year, after Rowe left the HIV/AIDS Administration, Hill's Community was awarded $300,000 despite continued reports of problems.
In December, Tonie Rhones, a housing coordinator at another local AIDS group, told monitors about the death of a woman who had been staying at Hill's house on Warder Street NW. Rhones said she was told about the incident by other women in the house.
The incident was also described to The Post by former Hill's Community supervisor Anita Boardley, who said she read details in a Hill's Community log book and had talked to members of the staff.
Accounts vary on what happened.
Rhones and Boardley said that Ruth Ann Tipton had fallen down a flight of stairs and that a Hill's Community staffer did not immediately call an ambulance. Later, when Tipton started moaning, paramedics were called, Rhones and Boardley said.
A Hill's Community staffer told AIDS officials in an e-mail that Tipton had fallen down the bottom steps only and had managed to get up and go to her room. Paramedics were called the same day, the staffer reported.
Tipton, 58, suffered internal bleeding and died in the hospital Dec. 3, funeral home and other records show.
In an e-mail to the HIV/AIDS Administration after Tipton's death, Marilyn Hill described the incident as a "sudden death," even though the records show Tipton fell Nov. 29 and died four days later.
Rhones said she urged the city to investigate.
"Nobody did nothing," Rhones said.
Kharfen said the agency asked the Inspector General's Office to investigate. But Deputy Inspector General Austin Andersen said, "We don't have any record of anyone referring that matter to us."
More problems emerged at a February site visit at the Warder Street house, when monitors found that W-2s for Hill's employees "didn't appear to be authentic," records show. Employees said they had no medical, dental or life insurance even though the Hill's budget with the HIV/AIDS Administration included those expenses.
Monitors also found there had been no substance abuse groups since "staff hasn't been coming to work."
Boardley, the former Hill's Community supervisor, told The Post that she once forged a signature on a time sheet for another employee at Marilyn Hill's request and would put fake names on empty personnel folders in case city monitors asked to review a list of employees. She said Marilyn Hill would doctor payroll records at a Staples store on Central Avenue in Maryland.
Boardley said Hill charged the HIV/AIDS Administration for several nonexistent employees: an AIDS counselor, nutritionist, physical fitness instructor, housekeeper and accountant. Names and résumés for the positions do not appear in the financial reports submitted by Hill's to the HIV/AIDS Administration.
Boardley provided The Post with documents that she said were fake, including a CPR certification from the American Red Cross that she said Marilyn Hill had given her. The Red Cross confirmed that Boardley had not taken its CPR course. Hill did not respond to letters seeking comment.
Boardley said that she agreed to help Hill with the documents because she needed the job and that she did not realize she was helping with fraudulent paperwork until May, when Boardley reviewed hundred of records that she had not seen before.
All the while, Boardley and two others said the women who lived in the house often had no gas, electricity or hot water for bathing, laundry or cooking. When their clothes got dirty, they would wear them inside out.
"How could they get away with this?" said Boardley, who recently left Hill's Community. She said Marilyn Hill still owes her money.
Although Hill had been billing the HIV/AIDS Administration for rent, the owner of the house on Warder Street told The Post in August that Hill hasn't forwarded the money and owed $20,000 in late rent payments and fees.
"It's like hell," said Giada Stewart, who until recently lived in the house. "There's no food. The gas was off. You can't cook. You can't bathe. The electricity was off. The staff is not working. They write grants that they're hiring so many people, but they're not. . . . What do people do? Who can we turn to?"
HIV/AIDS Administration director Hader said the agency stopped funding the program in early September and acknowledged that officials should have taken action sooner.'Serious concerns'
Money from Rowe's department also went to Lurn-N-Ern, a youth education agency formed in 1997 by one-time D.C. Council candidate Mona Odom, who had been an executive with the Girl Scouts of America in New Mexico.
Odom told The Post that she started Lurn-N-Ern to help troubled kids and that she applied for an AIDS grant looking for a new line of business. Odom said she was qualified to do the work because she had run computer classes and had helped women on welfare find jobs.
"I'm a motivator," she said. "When you own a business, you don't have to have [any] background or skill. You look for the people who had it."
In October 2005, Lurn-N-Ern was awarded a $135,000 grant to provide housing for 20 women with AIDS over the course of a year at Odom's four-bedroom house in Northeast.
"Come on over to our house," a Lurn-N-Ern flier said. "Put on your learning shoes."
On incorporation records, Odom's aunt was listed as Lurn-N-Ern's president. The aunt, now 72, lived in Baltimore and had filed for bankruptcy four times, records show.
Lurn-N-Ern's executive director was Odom's friend Benita Blaine, who had a criminal record for theft, assault and prostitution. Blaine's street name was "Peaches." In mid-2006, Blaine was indicted by a grand jury in Alexandria of stealing a co-worker's credit card to buy a $209 Sony PlayStation. After her arrest, records show, she tested positive for cocaine and the illegal hallucinogen PCP. She was sentenced to two years' probation.
Blaine's salary at Lurn-N-Ern was set at $18,000. Odom said she eventually let Blaine go because she wasn't showing up for work and appeared to be using drugs.
Blaine said she left on her own because she did not like the way Odom was running the program.
According to a December 2005 budget, which changed throughout the year, Odom planned to pay herself a salary of $47,000. She noted she was also paying a night supervisor named Rachel Hunter, but The Post found that the main credential and address on a résumé that Odom submitted to the HIV/AIDS Administration did not match any known Rachel Hunter.
By April 2006, seven months into the grant, only three clients had enrolled in the program and one had dropped out. Monitor Monique Berry noted in a report that Rowe was aware of the problems: "Mona spoke to Debra Rowe and a recruitment plan was implemented. . . . Rowe decided not to reduce the grant at this time."
In May, Berry e-mailed Rowe and others, saying: "I have concerns . . . they have only provided services to two clients. . . . Please advise me on what actions to take."
Monitor Charis Ferguson e-mailed back: "Funding must be decrease[d]."
In October 2006, monitors went back to Lurn-N-Ern to look into complaints from a former staff member and clients who said that Odom had been stealing their food stamps and that night supervisor Rachel Hunter "did not exist," records show.
Odom told The Post that Hunter is her mother, a 73-year-old New Jersey resident. "She was just to be a filler person until I could find someone to fill the spot," Odom said.
Odom acknowledged that the address on the résumé submitted to the city "might have been wrong."
Odom said she did not steal food stamps from her clients.
Two weeks after the October visit, with more than $100,000 in AIDS money paid to Lurn-N-Ern, Odom withdrew from the program, citing high costs in a letter to the HIV/AIDS Administration.
The next month, Rowe wrote to Odom, describing "multiple, serious concerns about performance of services."
Rowe told The Post that Lurn-N-Ern was funded because the HIV/AIDS Administration at the time "wanted new players" to get involved in the AIDS community. She said she eventually severed ties with the group.
Odom accused the HIV/AIDS Administration of failing to send enough women to her program. Despite the lack of clients, Odom called her program "a success."
"If it looks like I'm the bad guy, I can live with that," she said. "Life goes on."'Ruined my life'
Rowe said that, in the end, politics brought her down.
She said she was fired only after she wrote a letter to Del. Eleanor Holmes Norton (D-D.C.) and others in February 2007 alleging that a staff member in D.C. Council member Catania's office had ordered her to overlook federal policies to pay for housing for two District residents with AIDS. Rowe said she believes the FBI was called in retaliation.
She points to a February 2007 e-mail written by Smith, the Ryan White Planning Council member, warning Catania about Rowe's pending complaint.
"Debra Rowe is planning to blow the whistle on you. . . . This is being done to divert attention away from her and some activities which have come about regarding her personal affiliation with [Miracle Hands] as well as some other activities," Smith wrote.
Said Rowe: "This has ruined my life. All of this started after I wrote that letter."
The inspector general investigated the allegations outlined in Rowe's letter, however, and found "no evidence of misconduct" among Catania's staff, records show.
The FBI confirmed that its investigation was launched in December 2006, three months before Rowe sent the letter.
City AIDS director Hader said Rowe was asked to step down, months after the letter was written, because Hader found the housing program in disarray.
"People create their own narratives," Hader said.
* * *
As the city juggled public controversies and problem nonprofit groups, the entire staff at Joseph's House faced yet another budget crisis. Last year, the group was awarded $485,000 from the HIV/AIDS Administration, down from $750,000 four years earlier.
The staff at the well-regarded hospice in Northwest recently voted to take a pay cut rather than slash services or risk layoffs.
The city eventually gave the hospice money to save the jobs, but Joseph's House needs more staff and renovations and an elevator for sick boarders unable to navigate the stairs in the four-story house.
Head nurse Priscilla Norris does not have time to worry. Every month, there are new residents and, too often, another funeral.
On a dreary morning in June, she sat in the living room, hands pressed together in prayer. The staff had gathered to remember people who had died in the house in recent months, most of them from complications related to AIDS. The group lit candles and read names.
Since 1990, more than 300 men and women have died in Joseph's House, their pictures during happier times -- Tommy with a fishing pole, Melvin playing Spades, Karen riding a bus -- crammed onto shelves, mantels, tables and the top of an old piano.
There is no room left for pictures.
Staff researcher Meg Smith contributed to this report.