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Lax oversight at the Joint Office of Homeless Services allowed the contractor that runs three pod villages for homeless people to bill the city-county partnership $525,000 in unallowable expenses, according to a report by Multnomah County Auditor Jennifer McGuirk.
All Good Northwest overbilled the county by more than $330,000, mostly in personnel costs, by duplicating payroll expenses for the same pay period over separate invoices, the auditor said.
The Joint Office improperly approved another $193,675 in indirect expenses, the auditor said. Indirect expenses include overhead costs that don’t support a particular program, like accounting or HR.
The auditor’s office started its investigation after it got a tip on its Good Government Hotline. All the funds were recouped as a result of that alert, the auditor said.
The report is particularly damning, the auditor said, because Multnomah County helped set up All Good Northwest just last year, and the Joint Office was its sole source of funding.
“All Good Northwest was essentially a county-funded startup,” the auditor said. “It did not exist as an operational organization until the Joint Office contracted with it to operate alternative shelter programs. Because of this, it did not have any established funding or cash flow to support operations. It appears that All Good Northwest’s overbilling errors stemmed, at least in part, from cash flow issues within the organization due to its 100% reliance on county funding.”
All Good Northwest runs the BIPOC Village on Northeast Weidler Street, the Queer Affinity Village on Southwest Naito Parkway near the International School of Portland, and the Multnomah Safe Rest Village on Southwest Multnomah Boulevard. It also runs the Market Street Shelter. (WW reported this summer that All Good Northwest abruptly closed its rest village in Old Town, citing gunfire and other violence in the surrounding streets.)
“I want to be clear that no taxpayer money was lost,” Joint Office director Shannon Singleton said in a statement. “I am grateful to the Auditor’s Office for alerting us. We are trying new things to end homelessness, and moving fast, sometimes, we are going to move too fast. And that’s exactly what happened here.”
Andy Goebel, executive director of All Good Northwest, didn’t immediately return phone messages.
According to the auditor, All Good Northwest explained that the double billing occurred because All Good invoiced the county based on an estimate of personnel costs so that All Good could include the costs on an invoice and get it submitted in time to pay employees. It failed to take those estimated costs out of the next invoice, after the payroll costs were actually booked, the auditor said.
All Good was struggling, according to the auditor. Two directors made personal loans to the organization.
“Although there is no prohibition for a director to provide a loan, this should have raised concern in the Joint Office about the organization’s financial viability and, by extension, the organization’s ability to continue to provide services on behalf of the county,” the auditor said.
The Joint Office told All Good that it could bill the county for indirect expenses, the auditor said. But since 100% of All Good’s expenses, including administrative costs, were paid by the county directly, no additional indirect expenses existed. Billing for indirect costs was therefore unallowable, the auditor said.
“A more detailed invoice review process would have identified that All Good Northwest was billing 100% of its expenditures to the county, and indirect expenses were not applicable,” the auditor said. “After we notified Joint Office management that they had incorrectly approved paying indirect expenses, the Joint Office stopped payment and worked with All Good Northwest to get a corrected invoice processed.”