Steve Neavling, Detroit Free Press, March 14, 2012
In a move designed to improve services for struggling Detroiters, Mayor Dave Bing is forfeiting more than $72 million in federal money intended to help poor people because a city department showed it can’t handle the funds effectively, his administration said Tuesday.
Bing is shutting down the Department of Human Services on the advice of state and federal officials who became alarmed after investigating it, following a series of Free Press stories that chronicled corruption and mismanagement.
Council members threatened to challenge the department’s closing at a meeting Tuesday. They said new management is cleaning up wrongdoing and is prepared to continue overseeing poverty-fighting programs, including the early childhood education program Head Start.
“The state of Michigan is illegally withholding money for poor people,” Councilwoman JoAnn Watson said.
Of the department’s $72 million in annual grant funding, the city is losing $55 million for Head Start, which has been rife with mismanagement and abuse.
During the past year, the Free Press revealed that department officials took money intended for poor people and bought a car and high-end appliances; they were forced to return tens of millions of dollars for various community and home-improvement programs because the money was mismanaged, and employees received excessive salaries.
Because the state may bid out the work, it’s unclear what agency or agencies will take over the department’s programs. But council members expressed concern that for a short time, at least, some of the money will be handled by Wayne Metro Community Action Agency in Wyandotte — a city with little in common with Detroit.