Homeless-service provider claimed it wasn’t paid by Pierce County. Here’s how case ended
The Pierce County Council has agreed to an $800,000 settlement with a nonprofit that sued Pierce County Human Services over alleged missed payments.
Wellspring Family Services is a Seattle-based nonprofit which provides services and resources. It contended in a lawsuit that it was not paid by the county for nearly two years of homelessness services the county contracted it to provide to families and individuals experiencing or at risk of homelessness.
Between 2020 and 2022, Wellspring had four different contracts with Pierce County’s Human Services department to administer eviction and rental assistance and the county’s rapid rehousing program.
According to the lawsuit filed in Pierce County Superior Court, Wellspring successfully provided homelessness services to 320 households in Pierce County, including rental assistance, move-in cost assistance, eviction prevention and diversion assistance, hotel and motel assistance, food vouchers, car repairs and utility assistance.
As part of the contract, Wellspring had to comply with performance monitoring and auditing measures.
The monitoring measures were imposed by the county as a way of tracking accountability, but it also included guidelines required by the federal government as much of the contract funding came from federal sources.
Because the contracts took place during the pandemic, the monitoring of Wellspring’s housing programs initially was done remotely.
In January 2022, approximately nine months following the start of the initial remote monitoring program, Pierce County notified Wellspring that it would conduct an on-site, in-person monitoring of Wellspring’s client files due to purported concerns.
In June 2022, Pierce County delivered a letter to Wellspring and two attached reports, reflecting the findings of monitoring efforts.
The letter concluded that, “Due to the number and severity of the listed findings for the two projects, we have determined all client files fail to comply with project requirements completely and fully and are therefore deemed ineligible.”
The lawsuit noted Pierce County reported reviewing 24 participant files, which represented less than one-eighth of the files provided to Pierce County by Wellspring.
“Pierce County’s conclusions not only ignored the impact of Wellspring’s programs, which successfully provided critical services to 320 households (an estimated 700 individuals) experiencing homelessness in Pierce County, but likewise improperly relied on a small and unrepresentative fraction of the data and documentation that Wellspring provided, to claim that allegedly none of the files complied with the project requirements,” the lawsuit claimed.
According to a Pierce County report referenced in the lawsuit, auditors provided seven findings, which it stated resulted “from a material lack of compliance with a significant contractual requirement.”
Those findings included that none of the 24 case files included referrals from the county’s Coordinated Entry system or documentation of homelessness status, had proper documentation of income, included notes on background checks nor included information on a lease agreement signed by the client.
Libby Catalinich, a spokesperson for the county told The News Tribune the county monitors the performance of providers so it knows people are receiving the services they need and the funds are being well spent.
“We have limited funds so it’s important that providers use them as effectively as possible,” Catalinich wrote in an email to The News Tribune.
The county declined to comment on the case any further.
According to the lawsuit, the county’s auditors essentially concluded that because the program monitors did not find the few client files they reviewed complete, Wellspring should not be paid anything for work that it performed between June 1, 2020, and June 30, 2022.
According to the legal complaint filed by Wellspring, the county asked that Wellspring reimburse more than $1.2 million the organization was already paid under the contract and refused to pay Wellspring more than $839,700 they claimed they were owed for services they had provided.
When asked why the County Council made the decision to settle the case for the amount of $800,000, Council Chair, Jani Hitchen, gave this statement:
“The Council values the partnerships with our non-profits and are glad we were able to come to a resolution on this matter.”
