This is the second story in a three-part investigation, where Spotlight Delaware analyzed all of the grant applications, contracts signed by recipients and grant reports shared with the lieutenant governor’s office to determine how funds have been allocated in the state. Part 1 is available here.
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Why Should Delaware Care?
Delaware is nearing a new round of funding to get opioid settlement funds out to addiction recovery services. But an investigation by Spotlight Delaware has found those decisions are often made with incomplete information.
In the summer of 2023, Delaware officials sitting on a commission tasked with doling out the state’s opioid settlement windfall had three business days to review a mountain of applications – more than 300 pages – seeking nearly $10 million.
The next year, they again had two days to scrutinize dozens of applications seeking an additional $2 million. In the end, three officials withheld their vote, with one stating that she didn’t have enough time to parse through the pile of applications.
“Two days ago, we received a link giving us access to actual the applications and not just a description of what they were asking for,” Tammy Anderson, who is a voting member, said at that June commission meeting. “I had time to go through about 60% of them, but not the full list.”
Anderson said she reviewed a little more than half of them, finding some with merit, but others that raised questions.
“I have at least nine (applications) that I have questions about, and my overall impression is that the information provided between them is so uneven,” she added.
Over two months, Spotlight Delaware has obtained hundreds of pages of documents and emails via the Freedom of Information Act and spoken with nearly a dozen members of the Prescription Opioid Settlement Distribution Commission (POSDC) or those who have knowledge of its operations to understand the relatively new appointed body.
That investigation found commission members have approved grantees without ever seeing full applications, contracts drafted by commission staff are often far less detailed than applications, and reporting as to the effectiveness of the money granted to date is uneven.
Grants saw quick reviews
Spotlight Delaware reviewed emails sent prior to large POSDC votes and recordings of meetings, finding that the full commission only got applications and short summaries of organizations a few days before a vote.
A letter written to members of the commission by Attorney General Kathy Jennings said her office asked to reschedule that meeting to allow more time for review.
“In multiple instances, in both Phase 1A and Phase 1B, DOJ staff have had to advocate for Commission staff to remove clearly inadequate, incomplete, or unmerited applications from its grant recommendations,” she said.
In early 2023, ahead of the $3.5 million Phase 1A vote, the attorney general’s office raised concerns about the amount of time that commission members would have to read applications, according to emails obtained by Spotlight Delaware.
Additionally, another email shows those documents weren’t collected as part of the application process, and POSDC staff reached out to applicants to get this information only after scoring. These documents could include its operational finances, business licenses and budgets for how they’d use the funds.
Before the first vote on grant applications, POSDC Executive Director Susan Holloway said that commission members would need at least a full week to review applications, according to an email. After the Department of Justice were concerned with some applications and could not complete a thorough review of all applicants, a vote was delayed by several weeks to March 2023.
Emails obtained by Spotlight Delaware and meeting minutes show this wasn’t sustained in future grant cycles, with commission members only getting a few days to review dozens of applications and hundreds of pages.
Members were given a little more than three business days in July 2023 to review hundreds of pages in applications before a $9.5 million vote, according to records. Meanwhile, summaries of the applications were often limited to one sentence.
Spotlight Delaware obtained all 341 pages from Phase 1B applications and it took nearly eight hours to thoroughly review the entire batch.
At the June 28 POSDC meeting, the day commission members went to a vote on grant extensions, Anderson, a University of Delaware professor and commission member, held her vote.
She based her abstention on the commission only having two days to review the applications sent to her. In turn, Anderson said she couldn’t get through all of the nearly 50 applications prior to the vote.
When asked about the repeated practice of only giving a few days to review applications, Hall-Long’s office said the review periods were “flexible” and that when someone asked for more time – it was granted.
“We will continue to improve our processes to ensure more transparency and accountability,” Hall-Long’s office said. “This includes addressing the application review process.”
Ambitious applications
The Prescription Opioid Settlement Fund has awarded 70 different organizations more than $15 million since 2023. While some declined their awards, the majority accepted. There have been two open application periods for organizations to apply, as well as an opportunity for grant extensions.
Although many organizations presented rather ambitious plans in their applications that were approved by the POSDC, the final contracts that they signed were often significantly watered down.
For example, one organization sought more than $2.5 million to build a new treatment facility, mental health clinic and skills training center. In the end, it received a $100,000 grant to expand its treatment services and build a small skills training program.
Requests and contract differentials like this were common in Phase 1B. Unlike in the first round of applications, where grants were capped at $100,000, the second round was not capped.
Second-round application requests averaged $543,330, while the average award was $257,570.
According to an application screening guideline for the second round shown at an Aug. 21 POSDC Governance Committee meeting, Phase 1B applications received points primarily based on the number of boxes they checked off.
Applicants could score up to 85 points on their screening guidelines, and scores were tallied by determining whether the applicant demonstrated that the funds are applicable to settlement rules, where in the state the program would offer services, what high-risk populations are targeted and if a “high-use” area would be serviced.
Sixty-one of those points could have come from how organizations reported they’d use the funds in line with the settlement agreement. According to the public application portal for 1B, those metrics were self-reported by organizations and were “yes” or “no” answers.
By these metrics, Code Purple Kent County, an organization that’s now under investigation for fraud, would have scored much higher than organizations like Brandywine Counseling and Community Services, solely based on how many times it said “yes” in its application.
At that Aug. 21 meeting, Joanna Champney, the director Delaware Division of Substance Abuse and Mental Health (DSAMH), asked how smaller organizations that have a limited capacity to do work could score higher.
Holloway, the POSDC director, said that if organizations have some sort of agreement with treatment agencies and refer people who use their services to those agencies, they could earn more points, and the organization doesn’t actually need to provide the services, just facilitate them.
When it comes to organizations with larger applications, Holloway said the POSDC would look at the needs most aligned with Exhibit E, the national guidelines for allowable uses for opioid settlement dollars, and return to the groups with a different offer.
Grant enforcement?
After analyzing grant monitoring reports obtained via FOIA, Spotlight Delaware found that multiple recipients of opioid funds were inconsistently sending in evidence of their efforts to fulfill the grant requirements – some submitting months of data at a time, despite reminders.
SODAT Delaware, an outpatient treatment center in Wilmington, was awarded $100,000 to expand its opioid addiction services and distribute naloxone to uninsured patients. Of the $100,000 it’s been awarded, the commission sent the organization $25,000 for startup costs.
But more than a year after its first award, the organization had yet to send a single report to the POSDC, according to data from Aug. 29.
In an email statement, SODAT Director of Operations Latisha Bracy said the organization paused its operations for a year due to “several operational challenges.”
“The organization completed the first set of deliverables, however, instead of requesting the remaining $75,000, the organization chose to pause and to resume in the future,” Bracy said. “All reporting from the testing and outreach that was completed previously is up to date in the system.”
A spokesperson for the lieutenant governor’s office said funds aren’t sent until “data is submitted and verified by the monitor,” who are members of the lieutenant governor’s staff assigned to keep track of a recipient’s data.
The office also said there are times when recipients are “unable to submit their data reports on time” and reminders are automatically sent by the monitoring software.
But in a recent grant extension opportunity for previous recipients, nearly half of the awardees received additional funds despite not obtaining all of their first awards.
When it comes to contracts, many of the grantees signed agreements with identical “grant deliverables,” or targeted outcomes by a grantee. Moreover, many of these recipients are only bound by three quarterly deliverables, often lacking specific goals outlined in their application.
On a monthly basis, recipients are required to send in tracking reports that outline their efforts during that period. The commission gives recipients a list of 68 metrics to demonstrate what work they’ve done with the funding.
These metrics are based on principles from Exhibit E and greatly vary in specificity.
Relationships grow tense
Concerns over the operations of the POSDC first came to light in June after Attorney General Kathy Jennings began publicly addressing oversight issues.
Since that time, tensions have risen between Jennings’ office, which secured the opioid funds, and Hall-Long’s office, which has managed them. These arguments have happened both in private, as well as during public meetings.
In late-June, the attorney general flagged fraud accusations against Code Purple Kent County, which was awarded $570,000 from the settlement fund, and called for a freeze on future grants.
A month later, Jennings’s office also flagged that a grant recipient had been overpaid $20,000 by the POSDC after its contract was errantly inflated.
Back-channel emails between both offices also showed the attorney general tried to get a hold of tracking information for grantees for nine months, with it eventually boiling over into a formal letter to the POSDC demanding the records.
Delaware State Solicitor Patty Davis, who leads the Department of Justice’s Civil Division and has contributed to the POSDC work, noted concerns about how well projects have progressed in an email to Holloway.
“Lot of questions about the process and the decision making and what’s been going on in your office with the grants we’ve already awarded. Aside from data points and atTAck Addiction, we haven’t heard any status updates on how individual projects are progressing,” Davis wrote to Holloway on June 27.
In July, the state auditor’s office opened audits into 12 opioid relief recipients, although it has emphasized those reviews are not predicated by suspicion of wrongdoing but instead are a snapshot review of the program’s oversight.
Meanwhile, an independent Wilmington consulting firm, Social Contract, has been hired by the commission to complete a report about the industry of addiction resource companies in Delaware to further guide future grant distribution.
That report is scheduled to be publicly released on Oct. 28.
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