By Julie Bykowicz and Annie Linskey , julie.bykowicz@baltsun.com and Annie.linskey@baltsun.com|June 05, 2009
The Justice Department is threatening to withhold up to $8.2 million in stimulus money from Baltimore because of poor record-keeping for federal grants the city received a decade ago.
Until the city can account fully for how those federal funds were spent, it could be blocked from receiving money that Mayor Sheila Dixon is counting on to hire police and pay for other crime-fighting measures.
The Justice Department notified Dixon in a recent letter that the city is considered "high risk" and may not draw more Justice Department money until submitting documents on grants received in 1996, 1998 and 2000.
But city officials say they are confident that they have compiled the paperwork that Justice officials are seeking and will have much of it on their desks today.
"I'm not concerned at all that we're not going to be able to work this out," said Sheryl Goldstein, director of the Mayor's Office on Criminal Justice, which administered the grants. "These are paperwork issues. Everyone recognizes that this happened a really long time ago."
The city is anticipating $130 million or more in money next fiscal year from the American Recovery and Reinvestment Act passed by Congress and signed into law in February by President Barack Obama. The potential loss of any federal money when the city is cutting services to make ends meet has sent officials scrambling.
"For the last four weeks it has been my No. 1 priority," Goldstein said. Her office was responsible for administering the federal grants, though Goldstein was not appointed to the post until 2007. She has been collecting payroll slips, invoices for office furniture and construction receipts from the 1990s - a task she called "herculean."
City auditors raised questions about the grants in 2002 and have continued to do so. Each year, city officials assured auditors that they had the necessary documentation, but the auditors say they have never received it.
The 2002 city audit was forwarded to the federal government by October 2003, and the Justice Department has been questioning the city ever since, said Susan Oliver, a department spokeswoman. However, Justice officials had not threatened to withhold funding until this spring.
But twice the city has had to give back money - about $150,000 - because of incomplete paperwork filed with the Justice Department for Local Law Enforcement Block Grants. The grants, given for three-year periods, were distributed to cities for crime-fighting projects, including the hiring of prosecutors.
