The Department of Family and Community Services should identify internal controls needed to improve processes accountability and transparency pertaining to the operational activities of the department’s Health and Social Service Centers.
The Office of Internal Audit (OIA) conducted a special audit of the Department of Family and Community Services’ (DFCS) Health and Social Service Centers (HSSC). The audit was requested by DFCS as a proactive approach to improve HSSC operations and identify appropriate corrective measures.
HSSCs were conceived as one-stop-shops for the convenience of low to moderate income residents needing health, education and social services. DFCS is responsible for administering funds from a variety of sources in addition to managing HSSC fiscal agent and property lease agreements. Each of the four HSSCs is strategically located to service a quadrant of the City.
• Los Griegos – North • East Central – East
• John Marshall – South • Alamosa – West
Objective: Does DFCS have effective processes and accurate records for fiscal agent and property lease activities?
- Lack of oversight by DFCS, has allowed property lease activities to operate without contracts, unchanged decade-old rates and uncollected delinquent account receivables.
- Nineteen of 20 (95%) HSSC property lease contracts have been expired for over a year. The annual amount of lease revenue associated with HSSC leases is approximately $331 thousand.
- Five dollars per square foot lease rates have remained unchanged for approximately 10 years.
- Lack of fiscal oversight has allowed $37,312 to accumulate for delinquent lease payments.
- Lack of oversight by DFCS has allowed fiscal agent activities to operate without contracts, memoranda of understanding and accountability measures.
- Contracts or memoranda of understanding between certain HSSCs and not-for-profit organizations do not exist for three of four collaborations.
- DFCS has allowed and/or approved United South Broadway Corporation (USBC) to disburse approximately $2,716 in donated funds that do not support the mission or purpose of HSSCs.
- USBC adjusted John Marshall’s (JM) fund balance by $7,804, without the City’s consent, for prior year’s unallocated expenses, which do not appear consistent with JM’s expense activity.
Objective: Are internal controls adequate to ensure resource allocations are delivered to the intended recipients of HSSC services?
- Internal controls to ensure resource allocations have been delivered to the intended recipients of HSSC services have not been developed for City programs. As a result, DFCS cannot demonstrate that City HSSC resource allocations were delivered to the department’s intended recipients.
Objective: Does DFCS have effective internal controls to account for donations?
- Deficient internal controls for donation activities hinders the ability of the department to accurately account for, manage and derive the benefit from this form of public support.
Objective: Are supervisory controls for HSSC staff sufficient for detecting fraud, waste and abuse of City assets?
- Annual employee performance reviews have not been performed for the majority of HSSC staff. Supervisory controls have also remained unchanged despite prior personnel integrity and accountability issues.