November 11, 2003
Legislators want review of Wheels-to-Work grants
State should track recipients' jobs, they say

A state senator is questioning why a nonprofit group with "spotty results statewide and terrible results for some families" has received a $1 million grant to run a donated-car program for welfare recipients.

The state Department of Health and Human Resources recently awarded the grant to Morgantown-based Human Resources Development Foundation, an offshoot of the state AFL-CIO.

Sen. Larry Rowe, D-Kanawha, asked for a hearing and a review of the bidding process in a letter to DHHR Secretary Paul Nusbaum on Monday. Rowe asked why the grant did not go to Charleston-based Good News Mountaineer Garage, "which has been very successful" and was the model for the donated-car program, he wrote.

Another state senator also said he would ask tough questions about the welfare-to-work car programs during legislative interim meetings next week.

Sen. John Unger, D-Berkeley, said the program needs to track participants better, so it can determine if they keep jobs. He also wants more cooperation between DHHR and regional workforce investment boards, which fund employment programs.

"There's waste, there's potential for fraud or abuse in the system," said Unger, who co-chairs the Legislative Oversight Commission on Workforce Investment for Economic Development. "The goals the program is trying to accomplish aren't being measured. They don't know if they're accomplishing what they set out to do. That's bad public policy."

The legislators' questions follow news reports that revealed questionable spending in the state's $23.7 million Wheels-to-Work car lease program. Nonprofit groups sold clunkers to welfare recipients while used-car dealers reaped millions in sales and repairs over the past three years.

Since 2001, the Human Resources Development Foundation received more than $4 million to run a lease-to-own vehicle program in the central part of the state. The nonprofit group leased cars whose engines caught fire, mufflers fell off and seat belts didn't latch, according to program participants.

Some participants returned to welfare when their unreliable cars couldn't take them to work.

Sharon Paterno, a former DHHR official now working for the Human Resources Development Foundation, declined to comment on Rowe's letter Monday.

Last week, Human Resources Development Foundation officials vigorously defended the Wheels program. They said they sold quality vehicles that passed inspection.

The organization had the highest repossession rate in the Wheels program — about 40 percent. The agency "bundled" dozens of cars it wanted to get rid of and sold them at much-reduced prices. They were supposed to sell each car individually.

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Three years ago, the state started an ambitious program, West Virginia Wheels, to lease used cars to thousands of welfare recipients so they could get to jobs. But West Virginia's poorest citizens didn't get the safe, reliable vehicles the state had promised. Instead, many people wound up with dangerous clunkers while used car dealers made millions. What went wrong? Find out more in "Taken for a Ride," an ongoing Gazette investigation.
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