Report: New York City failed to control overspending on migrants

(The Center Square) — The Adams administration failed to provide oversight of a $432 million contract to provide services to newly arriving migrants, wasting millions of taxpayer dollars, according to a new audit.

The report by City Comptroller Brad Lander, who is challenging Eric Adams in next year's Democratic mayoral primary, blasts the city's Department of Housing Preservation and Development for a lack of oversight on the no-bid contract with DocGo, a private medical services provider, to provide emergency housing and other services for migrants, which expired in May.

The comptroller's report , which reviewed DocGo's invoices and properties, found a "wide range of fiscal mismanagement and shoddy oversight," including overpaying security subcontractors by $2 million, skimming off over $400,000 in overhead for almost 10,000 unused hotel rooms, and failing to ensure promised social and casework services.

"My office repeatedly sounded the alarm on the Adams Administration’s rush to contract with DocGo, and our audit confirmed that the City’s haphazard management ended up wasting millions of taxpayer dollars on DocGo," Lander said in a statement. "Each misstep reveals that the Administration failed to adequately vet the company or oversee their work."

The audit follows a previous report by Lander's office revealing deficiencies in the Adams administration’s emergency contracting practices, which totaled $54 million as of the end of November. Lander's report said a lack of transparency in the emergency contracting process increases the risk of overpayment and corruption.

In December, Lander revoked Adam's emergency powers to sign deals with private contractors providing housing, food, laundry and other services for asylum seekers without prior approval.

New York Attorney General Letitia James launched an investigation into allegations that DocGo has been deceiving and threatening migrants while failing to vet security officers properly. That probe is ongoing.

Camille Joseph Varlack, Adams' chief of staff, defended the administration's actions during the chaotic time period covered by the audit, pointing out that the city was faced with an influx of asylum seekers arriving on buses from Texas and other border states. She said the administration "kept families and children off the street" by negotiating a flat rate of $170 a night for migrant housing amid price gouging by hotel owners.

"We needed to make sure that people had a safe place to stay. I think that we have demonstrated that we have been able to do that," she told reporters at a Tuesday briefing. "We needed to make sure that we had hotel capacity to absorb the folks that were coming in. And we needed to make sure that we locked in a price for the city."

Varlack said the Adams administration has already implemented "many of the changes" that the comptroller called for a previous audit, which suggested DocGo was "ill prepared" to handle the volume of asylum-seekers requiring housing and other assistance.

To be sure, Lander has been a fierce critic of Adams' handling of the migrant crisis as he gears up to challenge the fellow Democrat in next year's mayoral elections.

"It is very comfortable to sit in the bleachers and, you know, just be a detached spectator," Adams, a Democrat, said during Tuesday's briefing. "But when you are running a city as complex as this, you have to be prepared."

New York City has had an influx of more than 210,000 asylum seekers over the past year and a historic surge of immigration along the U.S.-Mexico border, a crisis that Adams said is "not going away."

The city is providing housing, food and other necessities for more than 60,000 migrants in more than 200 temporary "humanitarian" shelters. Adams estimates the city will need to spend $12 billion on migrants through 2025.