NONPROFIT SETTLEMENT $1.1 million payback for claim agency overbilled
A state audit revealed the agency overbilled taxpayers in several counties.
PITTSBURGH (AP) -- A nonprofit agency that takes care of mentally retarded and disabled people will pay more $1.1 million to settle claims that it overbilled the state and seven southwestern counties for its services.
Passavant Memorial Homes of Harmarville must pay the money over seven years with no interest, according to its attorney, Jay D. Marinstein.
"We're very pleased with the settlement. We said from the start that the allegations were far in excess of the real issues involved in the case," he said.
A 2002 Allegheny County audit found the nonprofit overbilled taxpayers by more than $5.3 million.
The state later audited the nonprofit and concluded Passavant had overbilled taxpayers in several counties by $2.2 million, saying that Allegheny County auditors misunderstood a relevant regulation and noting that Passavant wouldn't share key documents. Passavant will pay half that amount to settle the claims.
Last year, Passavant was fined $450,000 and agreed to revise its pay formula for top executives. The state Attorney General's Office had sued after the Pittsburgh Tribune-Review published stories alleging excessive executive pay and lax internal controls.