NEW ORLEANS -- Billing errors, unnecessary overtime and an office rental price that's almost 12 times the market rate are among the reasons a city-funded electronic monitoring program run by the Orleans Parish Sheriff's Office has an annual deficit of more than $100,000, according to a report to be released Wednesday by Ed Quatrevaux, the city's inspector general.
The billing irregularities the IG's report describes may have resulted in money going to the Sheriff's Office that should have remained in city coffers, the report says.
Control of the program, which monitors the locations of defendants awaiting trial, was transferred from a private operator to the Sheriff's Office in 2011 after Sheriff Marlin Gusman signed an agreement with the city to monitor up to 71 adult and 45 juvenile offenders every month at a maximum cost of $50,000 per month. The agreement was modified in 2012 to cap the cost at $43,000 per month.
The city had previously contracted with Total Sentencing Alternatives Program, a private firm that came under fire for being too slow to report violators to judges.
In his report, Quatrevaux said total expenditures on the program exceeded the amount budgeted for it by about $126,000 in 2011 and $114,000 in 2012. In each of those years, the city had budgeted about $550,000 for the program. The city picked up the tab for the deficit in both years, Quatrevaux said.
According to the report, the biggest factor in the budgeting shortfall was a miscalculation by the Sheriff's Office of the cost of rent for its intake processing center at 2801 Perdido St.
According to the report, the Sheriff's Office estimated the rental value of the 782-square-foot space at $15 per square foot. That estimate, according to Quatrevaux, was in line with commercial leases along Tulane Avenue.
However, instead of multiplying the cost per square foot by the total square footage to find an annual rental price as is typically done in commercial real estate the Sheriff's Office performed the calculation on a monthly basis. The result was an annual rental cost of $140,000 instead of $11,370, making the intake center one of the highest-priced office spaces in the New Orleans area, with a whopping value of $179 per square foot.
Adding insult to injury, the Orleans Parish assessor's records list the city as owner of 2801 Perdido St., Quatrevaux noted, meaning that City Hall has apparently been paying top dollar to lease a property it actually owns.
In a response to the report, Sheriff Marlin Gusman admitted that the rent for the intake office 'was miscalculated and has been revised.' He said that even though the city owns the land where the intake center is located, the Sheriff's Office owns the buildings.
The report also found that deputies overseeing the program had 'regularly scheduled overtime,' which increased the cost of the program by more than $100,000, Quatrevaux wrote. The report said the Sheriff's Office could have saved money by instead hiring two additional deputies at annual salaries of about $34,000.
The monitoring price charged to the city, $13.25 per day for adults and $14.75 for juveniles, was also significantly higher than a proposal the Sheriff's Office made in 2009, when it offered to perform monitoring at $9 per day for adults and $12 for juveniles.
According to the report, the city withdrew its request for proposals at that time, then later entered into the agreement with the Sheriff's Office 'without a competitive procurement.'
The current price is also higher than the Sheriff's Office agreed to charge in order to receive a grant from the New Orleans Police and Justice Foundation to expand monitoring.
Gusman wrote that comparing the current program to the 2009 proposal isn't fair, citing 'a reassessment of costs, including the increased cost of employee pensions, number of employees and inflation on general costs' as factors in the different prices.
Billing errors, which consisted of incorrect rates, accounted for more than $23,000 in unnecessary expenses, the report said.
Quatrevaux also said the Sheriff's Office erroneously charged the city for more than $65,000 in postconviction monitoring, which he said isn't part of the agreement and should be paid for by the Louisiana Department of Corrections. Gusman said that monitoring was the result of court orders, which he could not refuse.
Quatrevaux laid blame for the bookkeeping problems on both the Sheriff's Office and the city.
'Neither party exercised sufficient financial controls or ensured the program's fiscal accountability,' he wrote.
In a response included in the report, city officials Jerry Sneed and Amanda Russell wrote that the city would henceforth require 'certification of all invoices signed by (Sheriff's Office) administration stating that the bill has been reviewed for accuracy and that all charges fall in line with the outlined objectives.'