Urban League's court battle with state still in limbo

The Urban League is still fighting with the state over hundreds of thousands of dollars of claims from the LIHEAP and weatherization programs.

The programs help qualified households pay utility bills and cut energy costs by making homes more energy-efficient. Locally, they serve more than 6,000 people annually.

The Illinois Department of Healthcare and Family Services said last December that the Urban League had failed to make $249,000 in energy assistance payments to Ameren on behalf of program customers in fiscal 2006 and that the state paid $200,000 for home weatherization work that wasn't completed.

Urban League Board President Sandra Jones said the work was completed. The problem, she said, was a matter of timing. The agency submitted bills at the end of the fiscal year, June 30, 2006 – before the work was finished.

"We absolutely had every intention of doing the work," she said, but added, "We did make a mistake, there's no question about it."

All the work was done before the programs were turned over to the Champaign County Regional Planning Commission in December, she said.

Likewise, with the Ameren payments, the Urban League reported at the close of the fiscal year that the bills had been paid, when in reality they were to be paid the next month, Jones said. When the state withheld the reimbursements, the Urban League couldn't afford to pay Ameren, officials said.

The Urban League said the state still owes it about $375,000 for administering the two programs – $157,389 in bills for fiscal 2006, which auditors say weren't submitted on time, and $215,000 for the first six months of fiscal 2007. The money covered payments to contractors who worked on homes and other operating costs.

State officials won't comment, citing "pending litigation."

The disagreement is tied up in two state administrative courts.

In August 2006, the Urban League filed a $157,389 claim with the state Court of Claims for work performed in fiscal 2006. The seven-member court rules on claims filed by state contractors after the fiscal year has expired.

At the request of the attorney general, however, that claim has been put on hold pending an administrative hearing with the Department of Healthcare and Family Services. The Urban League requested a formal hearing after a meeting in April with department officials failed to resolve the disagreement.

At that meeting, officials say, and in an earlier letter to the Urban League, the department not only denied the Urban League's $375,000 reimbursements but said the agency owed the state $580,669: $249,100 for the Ameren bill, which the state eventually paid; and $331,569 for weatherization that was not completed satisfactorily in 2006.

Representing the Urban League, attorney Jim Kearns of Urbana said state officials provided no documentation to back up the $580,669 figure. The department seized the Urban League's files from the two programs in early 2006, so the Urban League has no way of verifying the numbers, he said.

He wrote to state officials asking for copies of the records to prepare for the hearing but got no reply. No hearing date has been set. The two sides have had no communication since spring.

"We've had one meeting since December, and that was in April," said Tracy Parsons, the league's president and CEO.

The case remains in a sort of legal limbo, Kearns said. His next step will be to ask the Court of Claims to put the case back on its active list because there's been no movement on the department hearing.

The News-Gazette filed a Freedom of Information Act request last month for documents related to the case. The department has yet to respond, invoking an extension allowed by law.

In a statement, the department said the Urban League failed to comply with the terms of the two grant agreements in fiscal 2006.

The decision to end the grants and transfer the programs "was based on these and other performance failures.

"Our top priority is that families receive the home energy bill-payment assistance and weatherization services they deserve. ... We cannot comment on any investigation or further inquiries regarding the Urban League of Champaign County."

The department's announcement last December took Urban League officials by surprise. The league had managed the two programs for 25 years and worked closely with state officials to correct problems identified in its annual review, firing some staff, hiring a new financial director and realigning employees.

"We've contended since the beginning that the state hasn't been fair to us," Parsons said.

In some cases, Jones said, the state disallowed entire bills for the weatherization program because small problems were found months later – a stuck window, in one case.

"You don't disallow $32,000 of the entire job just because of one item," she said.

The Urban League was the only independent nonprofit agency in the state managing the programs; all others are run by state-designated "community action agencies."

The Regional Planning Commission has had its share of administrative headaches with the programs, including confusion over the distribution of LIHEAP grants in the summer.

"We're learning," Executive Director John Dimit said.

He said the programs are complex, and the state sometimes gives conflicting instructions on how to manage them. With myriad state and federal funding, it's easy to get duplications or omissions in accounting.

"If we did not have a solid financial record-keeping system, this would have been a complete nightmare," he said.

The agency has had trouble lining up enough contractors to complete the number of weatherization jobs required because government reimbursements aren't as lucrative as private-pay work, Dimit said.

It's also received complaints about the quality of some work.

"We're working through them," Dimit said, declining to offer details. "Any time you're doing a reasonable amount of construction, you're going to have issues crop up. It's our first year. Those things will iron themselves out."

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