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The Human Resources Administration (HRA) has little oversight in the administration of its employment service contracts for public assistance recipients, according to an audit released today by New York City Comptroller William C. Thompson, Jr.

“Among many important tasks, HRA has the important job of helping New Yorkers on public assistance get the job training and placement assistance they need,” Thompson said. “By failing to be as vigilant as it should be, HRA is missing opportunities to improve the quality of life of New Yorkers in need.”

In March 1998, HRA began converting its welfare offices into job centers. Job centers are intended to meet emergency and temporary financial needs, while supporting the efforts of those applying for or receiving public assistance to obtain employment and achieve financial independence. The job centers refer public assistance clients to vendors who train them and help them search for employment.

Thompson’s audit - which can be viewed at www.comptroller.nyc.gov - analyzed whether the HRA effectively monitored its employment-service vendors from July 1, 2004 to June 30, 2005.

During that time, HRA had two types of employment vendors for PA clients: Skill Assessment and Job Placement (SAP) vendors and Employment Services and Placement (ESP) vendors. HRA budgeted approximately $22,243,000 for SAP contracts and approximately $24,341,000 for ESP contracts in Fiscal Year 2005.

HRA showed that it had 24,759 public assistance recipients who were accepted in the SAP or ESP programs during that period. Of those, Thompson’s audit found 22,150 public assistance recipients with unique case numbers, 769 names with duplicate case numbers (of which 381 case numbers were listed two or more times), and 1,840 duplicate names (which included 800 names listed two or more times).

The audit’s main findings include:

• HRA’s Office of Contract Monitoring (OCM) did not conduct the required number of evaluation visits to vendors. HRA guidelines call for a minimum of three site visits per year per contractor, and officials from OCM have a goal of two site visits per vendor per year. OCM, however, only conducted 12 evaluation visits of the nine ESP vendors and seven evaluation visits to the four SAP vendors.

• HRA did not follow up in a timely manner to ensure that vendors implemented their corrective-action plans after evaluation visits. In 10 of the 12 ESP reports, OCM cited the vendor for only being in partial compliance with contract goals for job placement and/or retention. In three of the 10 reports, OCM did not seek or obtain corrective-action plans from the vendors to address this partial compliance. In all seven SAP reports, OCM cited the vendor for only being in partial compliance with contract goals for deficiencies; however, one vendor did not provide an action plan, stating that it could not meet job placement goals due to the large number of homeless clients it served.

• HRA did not comply with its guidelines and procedures for determining the eligibility of public assistance recipients. According to HRA, its supervisors are required to approve HRA staff members’ determinations of public assistance eligibility, including the assignment of case numbers. HRA staff, however, improperly assigned case numbers in some cases.

In addition, ineffective system controls allowed individuals with contradictory identification information to qualify for HRA employment services. The audit revealed a program participant with three dates of birth associated with one Social Security number who was assigned three case identification numbers. 

• HRA did not have adequate controls in place to ensure that payments made to vendors were valid, accurate, and properly approved. A review of 73 assessment, engagement, placement, retention, and high-wage payments totaling $72,522 found that there was insufficient evidence to support 18 payments totaling $18,563.

As a result of the findings, Thompson recommended that HRA:

• Ensure that OCM conduct the required number of evaluation visits to each vendor each year;
• Ensure that OCM requires corrective-action plans for all deficiencies found during visits to vendor sites;
• Ensure timely follow-up reviews of all deficiencies cited by OCM in its vendor-evaluation reports;
• Ensure that case numbers are properly assigned in accordance with HRA guidelines;
• Ensure that assessment and engagement claims submitted by vendors are reviewed and approved by HRA staff based on supporting documentation for each claim submitted;
• Ensure that employment verification forms submitted by employment-service vendors include the required employer’s seal or stamp, the client signature, and the hours worked per week; and,

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