The D.C. government paid out $1.1 million in food stamps and other assistance to 3,889 city residents who did not qualify for the benefits--including more than 1,000 who were working for either the city or federal government at the time--between August 1980 and February 1982, according to a new audit of the city's food stamp program.
Everett L. Mosley, a regional inspector general for the U.S. Department of Agriculture, which conducted the audit, said "the major problem" with the District's food stamp program during the period studied was that thousands of its recipients either underreported their incomes or falsely reported that they earned no income.
James A. Buford, director of the D.C. Department of Human Services, which administers the city's food stamp program, said yesterday that he had not yet seen the audit report and could not comment on it directly.
But he added, "Whatever corrective action is necessary will be taken to address the deficiencies. You can be assured that the D.C. and federal government employes involved will not be treated any differently from anyone else as we investigate the misuse of the system."
Another DHS official said the city has checked 10 of the cases cited by Agriculture and did not find evidence of fraud.
The report by Agriculture, which administers the federal food stamp program, states that in June 1981, approximately the midpoint of the period studied, there were 37,466 food stamp cases on record in the city.
Over the 18-month period examined, the report states, 3,889 recipients reported less income than they actually earned or falsely reported no income. The length of time the persons received benefits varied.
The federal auditors later found that among those recipients, 617 were working for the federal government and 400 were working for the D.C. government while they received the benefits, Mosley said.
The rest, Mosley said, were working for private employers.
The auditors uncovered the abuses by government workers by checking federal and city government payrolls against DHS food stamp records.
Mosley said 124 of the cases have been referred to Agriculture's investigative unit, which is working with the U.S. Attorney's Office on possible prosecution.
The rest of the cases, he said, probably will be referred back to DHS, which will then seek to retrieve the money.
According to the report, the benefits erroneously paid out included $577,849 in food stamps; $427,086 in Aid to Families with Dependent Children payments, and $113,824 in general public assistance, which is a short-term benefit for those temporarily unable to work.
As an example of minimum eligibility requirements for food stamps, a family of four qualifies to receive from $10 to $25 monthly in food stamps if the family's income does not exceed $12,000 annually.
John M. Bayne, deputy administrator of the DHS income-maintenance program, said the agency usually has had difficulty catching abuses by government workers, especially federal employes, because the federal government does not report to the city's Department of Employment Services the wages it has paid to individual employes, as private firms must.
He said that DHS is seeking to negotiate a change in that procedure and that the agency also plans to receive copies of the city government payroll on a regular basis.
Bayne said that so far, DHS has reviewed 10 of the 3,889 cases cited by the audit and found no fraud. In some of those cases, he said, the recipients did appear on a payroll as receiving income but not during the same months they received the food stamps.
He said the department intends to investigate about 100 of the cases "to see if there is a prosecutable universe of cases there."
The city has been criticized in the past for not aggressively pursuing welfare fraud cases. For example, a 1981 General Accounting Office report stated that between 1978 and 1980 the city paid out $50.8 million to recipients later found to be ineligible, while during the same period no cases of welfare fraud were prosecuted.
The new Agriculture report states that between October 1980 and October 1981, the agency collected only $20,852 in reimbursements from persons who had been overpaid in food stamp benefits, out of a total $275,969 in outstanding claims. It said the agency had abandoned collection efforts on an additional $143,000 in claims.
The report also states that DHS paid out $2.2 million between August 1980 and June 1981 to some 4,555 households whose six-month certification period for receiving food stamps had expired.
But DHS officials maintained that they checked most of the recertification cases that the audit questioned and that they overpaid only $151,954, not $2.2 million.