New York City Department of Homeless Services

Accuracy of State Aid Claims

Most of the homeless shelters administered by the New York City Department of Homeless Services (DHS) are operated by not-for-profit organizations or private companies under contracts or other agreements with DHS. The costs incurred by the shelters are reimbursed by DHS, and a portion of DHS's payments to these shelters is reimbursed by New York State. We examined the internal controls over the State aid reimbursement process and identified a number of weaknesses. Because of these weaknesses, the claims submitted by DHS are less likely to be accurate. Our review of selected claims identified inaccuracies that resulted in a net overpayment to DHS of $1.1 million. Most of the overclaimed amount was the result of a single error, as an adjustment of $994,699 was not properly accounted for by DHS. We recommend that this overpayment be refunded to New York State and certain improvements be made in the procedures used by DHS to claim State reimbursements.

For a complete copy of Report 97-N-8 click here.
For a copy of the associated follow-up report click here.