Audit Report on the Oversight of the Covenant House Crisis Shelter Contract by the Department of Youth and Community Development

AUDIT REPORT IN BRIEF

This audit determined whether the Department of Youth and Community Development’s (DYCD) payments under its contract with Covenant House for its Crisis Shelter program were valid and related to the operation of the Crisis Shelter and whether DYCD’s monitoring efforts of the Crisis Shelter’s bed-utilization rate were adequate.

DYCD facilitates youth and community development through contracts awarded to a broad network of community-based organizations throughout the city. Covenant House has been under contract with DYCD since May 2003 to provide services to children under the age of 21 through its Crisis Shelter program, which operates 24 hours a day, 365 days a year. Under the Covenant House’s contract for its Crisis Shelter program with DYCD, Covenant House is required to provide a 60-bed group residence that serves as an immediate safe haven to young people in crisis. In addition to providing beds for runaway and homeless youths, Covenant House provides food, clothing, crisis-intervention counseling, case management, health care, education, and vocational services.

During Fiscal Year 2005, DYCD reimbursed Covenant House a total of $640,207 from the $640,208 annual contract amount—$614,207 for PS and $26,000 for OTPS expenses.

Audit Findings and Conclusions

DYCD payments covered by the contract with Covenant House for its Crisis Shelter program were generally valid and related to the operation of the Crisis Shelter. The payment amounts made to Covenant House reconciled with the expenditures accepted by DYCD as reported on the monthly Program Expense Report Summary (PERS) forms. The total payments of $640,207 were made in accordance with the annual contract amount of $640,208. DYCD reimbursed Covenant House a total of $614,207 of the allowable $614,208 for its Personal Service (PS) expenditures and all of the allowable $26,000 for its Other than Personal Services (OTPS) expenditures. The OTPS expenditures were generally appropriate and adequately supported.

However, we identified several instances in which Crisis Shelter employees were paid for hours that were not adequately supported with timekeeping records. Nor did DYCD have any evidence documenting its monitoring of the bed-utilization rate or related discussions with Covenant House officials. Therefore, we were unable to determine whether DYCD adequately monitored the bed-utilization rates of the Crisis Shelter. In fact, of the Monthly Statistical Reports reviewed, Covenant House met the required monthly 95 percent bed-utilization rate only six times in Fiscal Year 2005. Finally, there was no evidence in the personnel files that the required inquiry to the Statewide Central Register of Child Abuse and Maltreatment (SCR) was made for one of the 18 Crisis Shelter employees reviewed. As a result, the Crisis Shelter had no assurance that this individual was cleared to work for the agency prior to being hired.

Audit Recommendations

To address these issues, we recommend that DYCD:

• Ensure that Covenant House maintains accurate and complete time records that reflect the hours worked by all employees covered under the Covenant House Crisis Shelter program contract.
• Document all monitoring of the Crisis Shelter bed-utilization rates and all contacts, including meetings and correspondence, with Covenant House officials on this matter.
• Ensure that inquiries are made to the SCR for all prospective employees covered under the Covenant House Crisis Shelter program contract, and that the responses are maintained in the employees’ files.
• Ensure that Covenant House immediately checks with the SCR for the one employee cited in this report.

Agency Response

DYCD officials generally agreed with the audit’s findings and recommendations.