NORWALK, Conn. – The Connecticut Department of Social Services says Norwalk Economic Opportunity Now (NEON) owes the government $314,605, and it wants the money now.
The debt stems from an audit report released in April in which the U.S. Department of Health and Human Services Office of the Inspector General (OIG) said the Norwalk social service agency misspent or failed to account for $314,605 in federal grant money claimed for NEON by DSS. The report said the money must be paid back.
A letter to NEON from DSS dated July 12 sets a July 26 deadline for return of the money. The letter, obtained from DSS after NEON did not respond to an email request for a copy, stated that, if NEON could not pay the balance by July 26, it should propose a payment plan by July 17.
Discussion about the letter is on the NEON agenda for its meeting at 7 tonight, July 24, at the NEON office, 98 S. Main St.
Also on the agenda is an executive session item noted as “Potential Litigation (DSS/OIG).”
The letter broke down the $314,605 in “unallowable costs” into five categories:
• $144,319 for costs with inadequate documentation or that were not reasonable for the performance of the program
• $93,415 in indirect expenses charged to the grants based on an unallowable methodology
• $57,040 in operating costs that were not reasonable and renovation costs without a federal waiver that did not meet program objectives
• $14,327 in prohibited lobbying, fundraising and donations
• $5,504 in missing equipment.
The letter said the audit report also recommended that DSS:
• Return to the federal government unallowable costs totaling $314,605 that it claimed on behalf of NEON
• Ensure that NEON establishes and implements policies, procedures and related internal controls to comply with all federal grant requirements, ensure that it charges only allowable costs to the Community Services Block Grant (CSBG) program and ensure that it follows generally accepted, sound business practices.
To read the entire letter and rules governing the CSBG program, click the link: DSS to NEON CEO 7 12 13