Audit: Corrections Department Overpaid Contractors

A state audit on Tuesday found that the Department of Corrections and Rehabilitations overpaid at least three private contractors by $5 million over a four-year period to provide drug treatment services to inmates, the AP/Modesto Bee reports.

The state inspector general's office, which performed the audit, said both the contractors and state officials are to blame for the overpayment (AP/Modesto Bee, 11/1).

According to the audit, contractors were overpaid because state officials did not require contractors to report money received versus the actual costs of the treatment (Zapler, Contra Costa Times, 11/1).

In addition, Mental Health Systems, one of the contractors in the report, overstated its expenses by more than $250,000 over five years when it billed the state for 22 vehicles that it did not depreciate in value.

The report also found that the department violated the law by allowing contractors to keep millions of dollars worth of equipment purchased with state money.

In response to the audit, the department has changed its accounting procedures and requested reimbursement from the contractors (Modesto Bee, 11/1).