Baltimore homeless services agency faces City Council questions about late rent payments

Property owners, housing advocates and city tenants who receive government subsidies took members of the Baltimore Mayor’s Office of Homeless Services to task Tuesday morning, slamming them for being late to pay the third-party housing providers who are responsible for paying rent and other services on behalf of some of the area’s most vulnerable households.

Problems with the homeless services office’s late payments to contractors bubbled to the surface earlier this summer when a group of five tenants and their households faced eviction in August. All of the tenants were participating in a city program that guaranteed their rent and utility bills would be paid, but some of those living with acute disabilities and recovering from substance abuse disorder said their payments were outstanding for months.

Representatives from the tenants’ landlord, Skyline Properties Management, blamed the eviction on failures by the homeless services contractor, Dayspring Programs Inc., to pay the bills on time.

Dayspring and the homeless services office have since shifted blame onto one another, with the city agency claiming that the provider has a contractual responsibility to pay the bills no matter how late it is reimbursed, and the nonprofit organization contending that it does not have the capacity to float the payments for so long.

Irene Agustin, director of the homeless services office, told members of the City Council on Tuesday that she inherited many of the agency’s problems when she stepped into the role in 2021.

She said staff turnover, fueled by the coronavirus pandemic, has affected how efficiently the office runs. The agency is tasked with overseeing large amounts of money from the federal government and understanding the many complex regulations attached to those funds — a challenge even with more staffing and resources than the office has now, she said.

“We are working to actively make those changes and to make the improvements that we need to in terms of financial management,” Agustin said, adding that the city’s Department of Finance will work to get the homelessness office into compliance.

She also outlined a number of steps and solutions the office has put forward, including hiring more staff, offering skills training opportunities, and improving communication with service providers, landlords and tenants.

But Agustin also took aim at landlords, saying they should think twice before entering into contracts they can’t honor.

“They all have a role in this,” she said. “It’s about knowing our system, and how those pieces connect, and how they work together.”

A number of property owners spoke at Tuesday’s hearing, with one, Andrea Campo, saying during an emotional testimony that she has lost faith in the city’s ability to keep its promises.

Campo said her tenant has been hospitalized due to the stress caused by the missed rent payments. “She doesn’t deserve this,” Campo said.

Testifying before members of the City Council, Sandra Jones said her daughter, Kimberly Brown — a Dayspring program participant — had been recovering from throat cancer treatment in the hospital when she learned she would be evicted. Brown is now unable to speak due to her condition.

Jones said Dayspring did not send a representative to rent court to testify on Brown’s behalf, and a judge sided in favor of the landlord. Brown has a 15-year-old daughter who has been traumatized by the threat of losing her housing, Jones said.

“The city, and Dayspring, made a commitment to us,” Jones said on Brown’s behalf. “I do not believe our children should suffer for an accounting error.”

All five Dayspring tenants have more than four judgements for missed rent payments entered against them in the last year — which, per city law, gives the landlord the authority to evict them even though they have been able to clear the debt.

Representatives from Dayspring did not answer a series of questions from The Banner, but said in a lengthy, unsigned statement last month that they went from April to August without getting reimbursed by the homeless services office.

“Dayspring is a small nonprofit and is unable to front hundreds of thousands of dollars to cover the costs of this HUD/MOHS program,” the statement said. It faulted staffing problems in the homeless services office for some of the delays, and said while there have been problems with late payments in the past, this year has been particularly difficult.

City Council members Zeke Cohen and James Torrence pressed the homelessness office to commit to making sure the five tenants stay housed if the evictions move forward and to investigate potential fixes to ensure their ability to secure future housing isn’t affected.

As the homeless services office confronts its relationships with landlords and service provides, it also is entangled in a separate matter involving a fumble of $10 million in funds from the U.S. Department of Housing and Urban Development.

The loss of that funding could have lasting consequences, as HUD considers how well grant recipients comply with their funding rules before awarding more money in future years.

City Councilman Eric Costello asked Agustin to confirm whether that $10 million — which wound up being lost due largely to a series of clerical errors within the city agency — would be unrecoverable.

“Yes,” Agustin said.

Costello responded by calling the situation a “fiasco” that warrants concern from the council.

The hearing included fierce lines of questioning from council members who are generally allies of the mayor.

“I want to know, if this has been going on, why we’re just having a meeting on September the 12th to say, hey, we need some help,” asked Councilwoman Danielle McCray, who represents Northeast Baltimore and previously served as an aide to then-Councilman Brandon Scott.

She highlighted the absence of City Administrator Faith Leach, who manages the homelessness office and reports directly to the mayor, at the hearing.

Later, Costello read aloud from a letter that Scott sent to HUD Secretary Marcia Fudge in late June. The mayor committed to having the city administrator create a corrective action plan within 30 days and hold a monthly meeting with the homeless services staff, both of which have not happened yet, Agustin said after a line of questioning from Costello.

There is no indication that Fudge ever responded to Scott’s letter, which asked for an extension to recover the lost funds and included an offer from the mayor to meet personally with HUD staff.

“This is frankly embarrassing, and I can see it in your face that it is not easy to sit through these questions,” Councilman Mark Conway said, addressing Agustin directly. “But I think it’s really, really important that we learn from this.”

Agustin noted that MOHS is now making weekly withdrawals from the system it was once locked out of for months at a time. “We want to make sure that we stay on top of the draws,” she said.

Costello also slammed the Scott administration for the duress the lost $10 million puts on city finances. Surplus money is tighter than usual, after the city’s revenue grew slower than projected and the state’s new school funding formula stuck Baltimore with what leaders called a surprise $79 million bill.

The city is still reconciling the lost money throughout the budget, said budget director Laura Larsen, estimating that her office would be able to present the council with a summary of the financial changes near the end of the calendar year. She said the city has about $100 million in reserves that can cover such “bad expenses” but could not yet guarantee that would include the lost $10 million.

hallie.miller@thebaltimorebanner.com

emily.sullivan@thebaltimorebanner.com

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