The city of Belfast and the state of Maine have settled a legal dispute over a Department of Health and Human Services directive requiring the city to refile all applications for reimbursement for General Assistance going back to October 2015.

From the period of August 2015 to July 2016 the City spent about $325,000 on General Assistance (GA). The state’s share of this bill at 70 percent is about $227,640. Under the terms of the settlement, the city will instead receive about $124,647, leaving a deficit to be absorbed by the city of about $103,000.

The city maintained that the state’s action was unduly onerous and lacked the legal authority to require retroactive reimbursement based upon a recent court decision in Portland. However, after the city did an internal review, we also acknowledged that we had some flaws in portions of our documentation. These gaps in file documentation were deemed essential by the state in order to support a request for reimbursement.

These file gaps included instances where:

  • A file failed to document a review and assessment of how an applicant spent any money they had during the month preceding their application to make sure it was all spent on basic necessities.
  • A file failed to document whether the applicant had 100-percent complied with any of the requirements that we imposed upon them since their last application.
  • A misapplication of what is defined in statute as to what constitutes an “emergency,” which could make an applicant who was otherwise ineligible, eligible.
  • Weak file narratives that helped to explain our decisions in some files.

The state was reacting to the size of the city’s expenditure, which grew from $35,000 in FY2015 to $325,000 in FY2016. However, the city knew that we underspent what we should have in FY2015 and we also knew that we failed to help many people during that period who were otherwise entitled to such assistance.

In 2010, by comparison, we spent over $100,000. As the result of under-assisting in FY2015, the city adopted policies that were designed to make sure that we were reaching people in need and to give these people the extra benefit of the doubt whenever we had any discretion. State law provides a lot of discretion to General Assistance administrators.

We expected to spend more in 2015-2016 but we did not expect to spend this much more. As these expenses were rising, we internally raised concerns over their size. Staff reassured us that these were being handled correctly and that the problem was related to the fact that three times as many people were applying, so we had a lot more expenditure.

GA is a state program. They are the experts and by law they are required to regularly review the administration of General Assistance in each municipality. We called and introduced our new General Assistance administrator to the state in July 2015 but they were not able to come to Belfast and review our procedures until February 2016. Even then, they were not able to get us a report until April 2016. By that time, the major expenses of FY2016 had already occurred.

As with other municipalities, we were invited to submit a “Plan of Correction," and we did so. It was accepted by DHHS in May 2016. Our expense concerns were further reassured by the state telling us in writing in May 2016 that, regardless of their findings during their review of our January files, they would still be providing their 70-percent reimbursement obligation for that month to us. I relied on that representation.

The state returned to check on us in July 2016 (after the end of the 2015-2016 fiscal year) and found some continuing problems with file documentation and determinations. I went in and reviewed the actual files the state referred to and found that some of their points were valid, but some of them were also misplaced or caused by poor documentation. I found that the city would instead have to retroactively resubmit a request for state reimbursement on all files going back to October 2015.

I have never heard of this being done before. In the past, the state identified problems, plans to address them were resolved, and everyone went forward in an improved way. I do not know of any other community facing this drastic consequence.

To comply with the state decision at this late juncture would require a complete review of more than 550 individual files. Each application is six pages in length and contains over 250 individual boxes where information must be entered every time a person applies. Narratives would need to be reviewed to help explain the decision-making. Payment vouchers to landlords, food stores, drug stores and utility companies would need to be individually accounted for each application that covered a maximum period of 30 days.

We could not shut down our existing program while we retraced all of these files. We would need to hire an independent person with significant experience in the administration of a General Assistance to review and, if need be, testify, as to the propriety of our actions, file by file.

After a broad search, we finally found someone who could help us look at our files, but they were only available to us for a part-time period between October and early December. It took over six weeks of independent part-time help to review a single month of files. We also had to hire additional help to keep up with the workload in order to create opportunity for the part-time consultant to get some access to the existing general administrator’s busy schedule.

We learned that we did indeed have some mistakes in the way we administered the GA program. Given the likely financial cost associated with a legal battle, the need to hire qualified experts and the reality that we had some flaws in some of our files, we looked to try to settle this with the state. Over the course of four months, we have been directly negotiating with them.

For FY2016 we spent $325,000 and the state’s share of 70 percent would be $227,000. The proposed settlement would provide the city with about $124,000 as the state’s reimbursement, leaving about $103,000 unreimbursed toward the city’s expenditures.

Yes, this means that this will cost you, in tax dollars, about $100,000. I do know that this upsets you. It seriously upsets me. The only thing I can do is to make sure we don’t fall into this pit again. We have made strides to do this by securing specialized training for several people including myself, making changes in personnel and in city policies on how we address General Assistance. We will be looking to limit the amount of time that we will assist with temporary housing in motels and use more homeless shelters and other options in other communities.

A big continuing problem for Belfast is the very limited inventory of apartments and mobile homes that are within the available funding maximums for GA. For Belfast, those maximums are $671 for a one-bedroom heated apartment, $793 for a two-bedroom heated apartment and $1,096 for a three-bedroom heated apartment.

If these apartments exist at these prices, then they are already taken, which has only helped swell the rolls of the homeless. There is a waiting list for every subsidized housing facility. The only answer will be to encourage the homeless to expand their search for both housing and employment beyond Belfast, and if they find something elsewhere in another town, then we are bound to help them during their first month. If it’s temporary housing in an out-of-town motel, then the period of our responsibility is six months. Cost always plays a role in these decisions.

There is more on all of this on our website under General Assistance and in the manager's report for March 7.

It is very easy to qualify as a resident of Belfast for purposes of General Assistance and it is also not difficult to qualify month after month for General Assistance. I close with reference to two parts of state law that we should all keep in mind:

22MRSA Sec 4307 Municipal Responsibility, residency (2) A

2A A resident of the municipality. For the purposes of this section, a "resident" means a person who is physically present in the municipality with the intention of remaining in that municipality to maintain or establish a home or a residence and who has no other residence: and

2B Eligible persons who apply to the municipality for assistance who are not residents of that or any other municipality. If a person is not a resident of any municipality, the municipality where the person first applies shall be responsible for support until a new residence is established.

22 MRSA 4301 Definitions

5 “General Assistance Program” means a service administered by a municipality for the immediate aid of persons who are unable to provide the basic necessities essential to maintain themselves or their families. A General Assistance Program provides a specific amount and type of aid for defined needs during a limited period of time and is not intended to be a continuing “grant-in-aid” or “categorical” welfare program. This definition shall not in any way lessen the responsibility of each municipality to provide general assistance to a person each time that person has need and is found to be otherwise eligible to receive general assistance.

I am sorry that I have to address this with you, but I’m happy to further discuss it with you and answer your questions.

Joe Slocum

Belfast City Manager