Audit 376568

Housing Quality Standards– HOME Investment Partnerships Program ALN 14.239 U.S. Department of Housing and Urban Development Criteria: Per 24 CFR §92.504(d), participating jurisdictions must monitor HOME-assisted properties to ensure compliance with HUD property standards throughout the affordability period. Inspections of HOME-assisted rental units must occur initially within 12 months of project completion and at least every three years during the affordability period. Condition: The City did not perform required property inspections within the prescribed timeframe. Scheduled inspections during 2023 were not completed as required by 24 CFR §92.504(d). Context: Our review of the City’s Consolidated Annual Performance and Evaluation Report and inspection records indicated that inspections scheduled for 2023 were missed due to staffing shortages following personnel transitions. Cause: Inadequate internal controls over inspection scheduling and insufficient staffing resources. Effect: Failure to perform inspections increases the risk that properties may not meet HUD standards, potentially resulting in unsafe living conditions, noncompliance with federal requirements, and exposure to HUD findings or repayment of funds. Repeat Finding: No. Recommendation: We recommend the City implement a tracking system for inspection due dates, assign responsibility for monitoring compliance, conduct overdue inspections immediately, and update policies to address staff turnover contingencies. Management’s Response: See management’s response in City’s Corrective Action Plan.

Reporting – Coronavirus State and Local Fiscal Recovery Funds ALN 21.027 U.S. Department of the Treasury Criteria: The U.S. Department of the Treasury established reporting requirements for local government recipients of Coronavirus State and Local Fiscal Recovery Fund (SLFRF). Recipients are required to submit quarterly Project and Expenditure Reports through the Treasury’s reporting portal by the last day of the month following the end of each quarter. Condition: The City submitted all required quarterly reports for 2023; however, each report was filed after the required deadline. Reports were submitted within 60 days after quarter end, rather than by the last day of the subsequent month as required. Context: Our review confirmed that all reports were eventually filed, but none met the prescribed timeline. Cause: Lack of knowledge and insufficient internal controls over SLFRF reporting requirements. Effect: The City was not in compliance with federal reporting requirements, which may increase the risk of questioned costs or impact future funding. Repeat Finding: Yes. Prior Year Finding 2022-001. Recommendation: We recommend the City strengthen internal controls over SLFRF reporting requirements, including assigning responsibility for monitoring and reporting program activity to appropriate individuals and ensuring those individuals understand Treasury deadlines and portal requirements. Management’s Response: See management’s response in City’s Corrective Action Plan.