There is some confusion on this.  Some people think that since we will be getting the $3.4 million back in HUD grant monies that the $3.4 million fine in essence did not cost us anything.   This is not true:

  1. If HUD determines that there have been mistakes, the PJ (presiding jurisdiction), the City of Worcester, needs to return the money.
  2. It is then up to the PJ whether or not they want to try and get the monies back from the underlying entities.  In this case, the PJ (City of Worcester) chose not to go after the recipients of the money in question.
  3. At this point HUD will merely reduce future grant awards by the amount owed (3.4 million) to get their monies back.
  4. The City of Worcester, however, chose to pay the 3.4 million so future awards would not be reduced.


In essence the City of Worcester paid 3.4 million for 3.4 grant monies that we could have received for free if we did not owe this money from the audit.    This did in fact cost the City of Worcester 3.4 million.  It was