Nonprofit overbilled, Montgomery, Md., says

By Miranda S. Spivack
Washington Post Staff Writer
Thursday, November 12, 2009

Centro Familia, the Wheaton nonprofit whose contracts are under scrutiny by Montgomery County and the FBI, overbilled Montgomery's health and human services agency $85,000 in the past year, according to a county analysis obtained by The Washington Post.

The analysis cited possible "duplicate charges" and said county funds might have helped finance Centro Familia enterprises that were not linked to its county contracts.

The conclusions were in a letter from Uma Ahluwalia, director of the county's Department of Health and Human Services, to Centro Familia. Ahluwalia declined to release the letter and related documents. She said Centro Familia had asked the county to withhold them.

The nonprofit offers an early childhood program to about 30 preschoolers and has trained more than 300 in-home child-care providers, many of them Latino. It has been a county contractor for several years and holds three one-year contracts totaling about $450,000.

Pilar Torres, executive director of Centro Familia, has denied any wrongdoing and has said the group had not misused funds.

In an e-mail Wednesday, she said Centro Familia is "preparing a formal protest to the DHHS conclusions. We have been waiting for over four months for DHHS to respond to our actual cost analysis that shows we were underpaid by $18,926. What is most damaging to [Centro Familia] is that there is an accounting audit that is being discussed and resolved in a public platform and [The Washington Post is] only featuring [Centro Familia] in the most negative light."

Ahluwalia's letter said that the county had struggled for months to obtain information from Centro Familia and that the nonprofit has not provided all the documents the county needs. The letter also said some documents that Centro Familia provided were difficult to decipher and that many "remain missing," including leases with two churches. The letter said the county was unable to determine, based on the information Centro Familia provided, whether the group was underpaid by $18,926.

In late August, the county renewed its contracts with Centro Familia through next June.

Centro Familia has been scrutinized by the Health and Human Services Department since early this year, when questions were raised by the county's independent inspector general.

The Post reported Nov. 2 that an FBI agent had begun to examine Centro Familia's financial records. Torres acknowledged that an agent visited Centro Familia, but she said the government's continued scrutiny is a "witch hunt" and "a strong abuse of power by county officials."

Centro Familia has strong ties to county politics. The group's accountant is Larry Rosenblum, campaign treasurer for County Executive Isiah Leggett (D). Board members include an aide to Rep. Chris Van Hollen (D-Md.) and state Del. Anne R. Kaiser (D-Montgomery).

Inspector General Thomas J. Dagley said his office was continuing to look into the county's management of its Centro Familia contracts.

"We are examining management practices used to approve the contractor's fiscal year 2009 monthly invoices and related payments, and decisions last summer to extend the 2009 contracts and execute new contracts for fiscal year 2010," Dagley said.

The annual health and human services budget is about $272 million; about $100 million of that is spent on outside contractors.

County Council member George L. Leventhal (D-At Large), who chairs the Health and Human Services Committee, said he wants to ensure "due process" for Centro Familia.

He said he "believes the Health and Human Services Department is taking appropriate steps to see that the county will be reimbursed." He said the inspector general's inquiry "appears to be grounded in some real irregularities."

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