20-05-2025
Preliminary audit of YDC fund lacks any smoking gun
Anyone expecting that a preliminary audit of the Youth Development Center Settlement Fund would have an explosive, smoking gun finding is bound to be disappointed.
Carson requested and Legislative Fiscal Committee ordered YDC fund audit
Senate President Sharon Carson, R-Londonderry, requested and the Legislative Fiscal Committee approved a report reviewing the finances of the Youth Development Center Settlement Fund created in 2022 to consider damage awards to victims of alleged sexual and/or physical abuse.
The 18-page report addressing seven bullet points the Legislative Fiscal Committee had called for at the urging of Senate President Sharon Carson does not cite any concern that the fund, created in 2022, has been improperly managed.
Christine Young, director of audits under Legislative Budget Assistant Michael Kane, said four members of her team conducted interviews over the last four weeks of employees involved in the program with the Department of Justice (DOJ) and the YDC Claims Administration (YDCCA) staff group. They've also been reviewing all policies and reports.
A final report from Young's group is due in early June.
Carson said she requested the review because she didn't know enough about how the fund was dispensing awards, especially since June 2024 when a new law allowed fund administrator John Broderick and his legal team to pay out awards over time rather than in lump sums.
The law allows awards to be paid in up to 10-year terms, but the report found that only five of 80 approved awards would be paid over 10 years, while 50 of the 80 awards will be paid out in four years or less.
Awards already agreed to are going to cost the state budget at least $20 million in the two-year period that begins July 1, according to the report.
The House-approved state budget has earmarked only $10 million for the fund in each of the next two years. Broderick has requested $150 million, which would equal the $75 million the fund is allowed to spend in any given year.
Payments to lawyers
Carson and other fiscal members raised questions about how lawyers representing the victims are paid.
The report found the average attorney fee paid to date has been 30.8% of the award, below the 33% cap allowed by state law.
Young's report confirms that 18 firms representing more than 75% of the victims have agreed to receive their fees over a three-year period.
But the report found 50 claims had attorney fees totaling $11.2 million that had been paid in lump sums while their clients were all getting paid in installments.
The report does reveal that Broderick has chosen not to act upon requests from Attorney General John Formella's staff for more fact finding on his cases.
Preliminary financial report on YDC settlement fund released
A House-Senate budget oversight committee approved an immediate audit into the finances of the state-created claims fund that approves damage awards to victims of sexual and physical abuse at the Youth Development Center in Manchester (pictured).
The AG hired the Verrill Dana law firm of Portland, Maine, to review claims by the administrator to assess completeness and areas of agreement or disagreement. From 2022 to 2024, the AG had to provide its position whether it agreed 'fully or partially' with the administrator's claim decision. Since June 2024, that view from the AG has been optional though the practice 'remains substantially in place,' the report said.
Young said the Verrill Dana firm has 'in certain cases' requested Broderick refer the case to a fact facilitator, but Broderick has not done so.
'YDCCA staff reported requests have not been granted by the administrator to conduct an additional independent investigation because statute requires timely processing of claims, and the resolution proceeding uses trauma-informed professionals to address verification and credibility questions in addition to controls throughout the claims process,' the report said.
'Contracts for these professionals include fact facilitation in the scope of work should it ever be needed.'
Other details in the report included:
* Inmate victims: Nearly one in five who have brought claims are currently prison inmates. Only 17 of those inmates are in out-of-state jails while the other 181 (91.4%) reside in New Hampshire prisons.
* Administrative costs: Formella's staff spent 61.6% for the fund with the YDCCA has accounted for 38.4%.
* Size of awards: The average award has been $543,000. Among the 296 completed claims, 54 of them were more than $1 million and 242 were less than that benchmark.
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