Did L&I overbill hundreds of property owners in 2012?

File photo: The large vacant lot at 1801 West Courtland St. is shown in the foreground with the homes on Gratz Street in the background on April 25, 2014. An audit raises the question of whether the city overcharged property owners for clearing vacant lots. (CHARLES FOX/Staff Photographer)

If you were one of hundreds of bad neighbors who let your vacant Philadelphia property get so run-down a few years ago that the Department of Licenses and Inspections cleaned it, sealed it and sent you the bill, here’s a question:

Were you overcharged?

An audit by the City Controller’s Office for fiscal year 2012 found that L & I overcharged at least four property owners by 34 percent for cleaning and sealing their properties. Controller Alan Butkovitz said Wednesday that his office sampled four bills sent to owners -- and found all four were overcharged. Butkovitz said the billings totaled $1,176 when they should have been $878.

L&I Commissioner Carlton Williams said that when the auditors initially found the billing errors last year, L&I corrected its computer system, which was automatically adding an extra half-hour of work to all Clean and Seal Operation jobs — the boarding-up or cleaning of lots around vacant buildings.

“We fixed the glitch last summer,” he said.

Williams said L&I did not reach out to the property owners to tell them of the glitch.

“We don’t even know if that’s accurate or not,” Williams said about the controller’s claims of overcharges.

But if the glitch was adding 30 minutes to every job, might that suggest many owners were overcharged?

No, Williams said. “There could’ve been discrepancies,” he said -- adding that his department will be reviewing the 2012 bills for any overbilling, as well as prior years, to gauge the “magnitude” of the problem.

In fiscal year 2012 alone, the department issued 1,492 clean-and-seal bills, which totaled almost $1.4 million in charges.

Overbillings have existed since 2010 when the Controller’s Office found that five out of five sampled bills included overcharges, the latest audit report stated.

"It raises a serious concern when the City is over billing property owners," Butkovitz said in a news release. "If the City expects owners of these properties to pay the full amount on time, it needs to bill for the correct amount."

As we pointed out in previous articles, many of these L&I bills for vacant properties don’t get paid and end up as so-called “nuisance” liens. Those liens, like unpaid taxes, accrue interest based on the initial bill.

So if those bills were erroneous, the nuisance liens could also be off, too.

Until a review is completed, Williams said, “If any property owner believes they made payment on an inaccurate clean-and-seal bill, they should immediately contact our Department for a review of the charges.”

Other items flagged in the controller’s audit of the city’s 42 department and agencies, released Wednesday, included:

- More than half of city agencies did not have a process set up for late arrival to work or requesting paid time off, leaving the departments “exposed to higher risks for employee abuse of city time,” the audit found.

- The city’s sick leave policy — of not placing employees who exceed sick time in a list and subject them to penalties — was not followed by 13 agencies, the controller found.

- The Sheriff’s Office was singled out for not going through the proper channels to approve $23,123 in travel reimbursement vouchers. “Employees could submit fraudulent reimbursable expense vouchers with little chance of detection,” the audit stated.

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