Review of Training Contract Practices at the New York Department of Social Services

EXECUTIVE SUMMARY:

This final report provides the results of a review made by the OIG of training contract costs claimed by New York State. The review disclosed that New York and several components of the State University of New York overbilled the Federal Government for the training of social service workers. In late 1994 New York signed a settlement agreement with the Department of Justice (DOJ) and the OIG. The agreement resulted in a cash refund of $26,970,000 from New York to the Federal Government. Since the improper training contract practices found by this review may also exist in varying degrees in other States, we recommended that the ASMB alert USDA and SSA to the conditions disclosed by this review. We also alerted ACF and HCFA to these conditions. We also recommended that ASMB advise and coordinate the efforts of the involved entities to assure the States' compliance with regulations that cover the allocation and claiming of training contract costs. To assist in this effort, we have initiated a review of training contract practices in six additional States. Finally, we recommended the periodic review of future training expenditures claimed by New York to ensure that it continues to adhere to the terms of its settlement agreement with DOJ. The ASMB concurred with these recommendations.