The city also spent $333,330 on unallowable expenses under the grant agreement, by using it to help fund salaries and benefits of WorkSource’s top staff, according to the labor department.
“The City partnered with the Department of Labor to address their concerns,” a spokesman for Mayor Keisha Lance Bottoms said in a statement. “However, we did not receive an extension and will move forward to close out the grant.”
The statement added that the city will continue to search for new grant opportunities.
Accusations that WorkSource has served as prop for fraud and abuse of government funds have beleaguered the city agency for more than a decade. The allegations include employees working for a mayoral campaign and funding a fake jobs program.
In 2013, the city’s auditor recommended that WorkSource be shut down.
Last year, the Atlanta City Council asked for an audit after WorkSource lost a $1.3 million jobs training grant by failing to spend the money before the deadline.
The Atlanta Journal-Constitution reviewed about 35 pages of correspondence over the past year between the city and the federal agency that were obtained through the Georgia Open Records Act.
The AJC also reviewed a 54-page city audit of the program, which found that WorkSource disregarded government guidelines and mismanaged programs. The audit, released in March, specifically mentioned the risk of losing the $4 million federal “TechHire” grant.
“Leadership instability may have created challenges in meeting performance targets,” the audit said. “WorkSource Atlanta has had six executive directors over the past six years, and the agency’s oversight board has not met regularly since February 2018.”
A team from the U.S. Department of Labor reviewed WorkSource’s “TechHire” grant in early 2019.
Labor department officials briefed seven of WorkSource’s top staff on their findings in April. Among them: there were unfilled staff positions for the grant, misclassified costs and a failure to draft a plan to deliver the grant’s services.
“The grantee must serve only the current participants and suspend all other recruitment efforts until the grantee provides a detailed service design and delivery plan,” the labor department said in a letter dated in June, 2019.
It provided an outline for how WorkSource needed to fix the problems.
Around that time, Bottoms announced that WorkSource Atlanta would be placed under the authority of Invest Atlanta, the city’s economic development arm.
A spokesman for Invest Atlanta said Monday that transition is still taking place.
Bottoms then tapped Katerina Taylor, former president of the DeKalb Chamber of Commerce, to take over WorkSource in October.
The city declined to make Taylor available for an interview.
Further correspondence between WorkSource and the labor department reveals that the federal agency remained displeased with WorkSource’s efforts to comply with the “TechHire” grant obligations over the past year.
Finally in a letter to Taylor dated July 1, the labor department indicated it had run out of patience.
“Your request to extend the grant beyond June 30, 2020 is denied,” wrote Department of Labor Grant Officer Brinda Ruggles.