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Brentwood homeless shelter’s contract ended over alleged overbilling

Suffolk County Comptroller John Kennedy Jr., speaks during

Suffolk County Comptroller John Kennedy Jr., speaks during a press conference at the Dennison building in Hauppauge on Wednesday, March 9, 2016, as John O'Neill, commissioner of the Department of Social Services, looks on. Credit: James Carbone

Suffolk officials delivered on Wednesday a termination notice to a homeless shelter operator, the Long Island Women’s Empowerment Network in Brentwood, saying its pending audit shows the nonprofit group intentionally overbilled the county by $3 million.

”There were a few individuals that we believe . . . were looking intentionally to overbill the county,” John O’Neill, county social services commissioner, said at a Hauppauge news conference Wednesday. “We don’t want the taxpayers’ money misappropriated in any way. We take that very seriously as this vendor is finding out.”

“It was not the transposition of a number or a decimal point,” said County Comptroller John Kennedy, but rather “a willful, intentional effort on the part of the operator to deceive and to be covert in their operations.”

Dennis Sneden, the Women’s Empowerment Network’s vice president for development, declined to comment Wednesday, saying he did not know what occurred at the news conference.

O’Neill and Kennedy were scheduled to meet Wednesday with officials from the district attorney’s office over potential criminal prosecution and will ask County Attorney Dennis Brown to pursue any possible civil remedies to recover overpayments beyond the $600,000 the county has already withheld in the last three months. Kennedy also said his office will complete its audit and expand it to cover the last eight months of operation.

While O’Neill delivered a termination notice, the county needs the network and the landlord both to agree to assign the existing lease for what once was a hotel in Brentwood to a new nonprofit operator, which the county has already selected.

However, O’Neill emphasized that the 117 adults and 287 children now living at the shelter, the county’s largest, continue to receive services without interruption and said he hoped the new operator could be installed within a week. O’Neill declined to name the vendor, but county sources say Family Service League, which operates several other county shelters, is going to replace the network.

Officials also disclosed the audit was spurred by anonymous letters received by both the comptroller and social services, which alleged management’s “misuse of funds” and a “diversion of resources.”

At their news conference, Kennedy and O’Neill said the Women’s Empowerment Network, without county approval, hired a half dozen private contractors to supply security, housekeeping and maintenance services, even though the shelter’s $6.6 million budget provided nearly $2.1 million to fund that work in-house. Instead, those contractors cost $866,000 more than budgeted.

Kennedy also said auditors found $2.237 million in claims that were disallowed, including network debit card payments for more than $5,000 in hotel and restaurant bills.

Officials also disclosed new fiscal controls requiring all shelter operators provide the comptroller with a profit and loss statement every 90 days and submit to the comptroller for financial review any proposal to hire outside contractors before seeking social services approval.

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