Council committee approves $3.5 million appropriation to DePaul USA for Strobel House after questions about billing and contract errors

The Metro Nashville Budget & Finance Committee voted to appropriate $3,500,000 from the Office of Homeless Services to DePaul USA Inc. for property management, on-site support and case management services at Strobel House permanent supportive housing.

The appropriation was approved after public comment and a lengthy staff discussion about contract paperwork, multiple funding streams and payment procedures. The motion carried with 10 in favor, 0 opposed and 0 not voting.

Why it matters: Council members and the public raised questions about how Strobel House expenses were billed and paid, including apparent clerical errors in a grant contract and use of payment methods that bypassed purchase orders. Committee members pressed the Office of Homeless Services and finance officials for explanations and corrective steps to prevent similar problems going forward.

Public comment flagged contract inconsistencies and billing totals. In public comment, Steve Reiter said he found a “clerical error” in the DePaul contract that listed different term lengths in separate sections and an effective date of June 30, 2026. Reiter also said the council had approved $500,000 as a start-up cost for Strobel House but that, according to reporting he’d seen, “more than a million dollars has been billed for this operation” and that “we just haven't gotten the answers.”

Director April Calvin of the Office of Homeless Services explained the procurement and payment history to the committee. Calvin said coordination problems across multiple Metro departments, vendor negotiations, staffing turnover and mixed funding streams contributed to the situation. She told the committee DePaul has been the vendor operating Strobel House for the last year and that the vendor has “housed over a 100 individuals there,” including 68 people who experienced chronic or street-level homelessness.

Calvin described the appropriation before the committee as a measure to “bring us into compliance with that funding stream that we had already received” and to align the contract with the money that Metro had been paying from previously authorized funds.

Finance and procurement officials described how payments were made and why the overrun occurred. A finance official explained that some payments to DePaul were processed as direct vouchers rather than through purchase orders. Direct vouchers are approved at the departmental level and are not automatically linked to a contract in the financial system, the official said — a method that, in this instance, allowed payments to continue after the department’s contract total had been reached.

Mary Jo Wiggins, a finance department representative, told the committee that while finance conducts after-the-fact contract reviews, departments are responsible for monitoring grant contracts during execution. Wiggins and other finance staff described system changes planned with Metro’s forthcoming Oracle Cloud implementation to link vendors and contracts more tightly so vendors engaged under contracts will be designated for purchase-order payments only and not allow department-level direct vouchers to bypass contract limits.

Committee members pressed for accountability and training. Councilwoman Soria said it looked like “a huge error” and asked whether finance was alerted when payments were approved. Calvin said the issue came to light after staff turnover and that corrective work began about three months ago. Calvin listed four corrective actions OHS undertook: working with central finance and Metro Legal to ensure procedures are followed; hiring a contract administrator; enrolling administrative and finance staff in certified county finance officer training; and realigning payment processes with Metro Finance.

Some council members described the payment errors as both a departmental and systems problem. Wiggins described existing safeguards — monthly OMB reviews and after-the-fact contract monitoring by the Office of Financial Accountability — and said the new Oracle Cloud configuration will allow Metro to restrict vendors with contracts to PO-only payment methods going forward.

No new conditions or penalties were imposed by the committee; the resolution before the committee was an appropriation to authorize payment and align the contract with existing funding. Committee members said they expect continued follow-up on the department’s corrective measures and system changes to prevent recurrence.

The committee approved the resolution and then moved on to other items on the agenda.