Finding Text
Finding No.: 2025-008 Identification of the federal program: Federal Agency: U.S. Department of Housing and Urban Development (HUD) AL Program: 14.239 HOME Investment Partnerships (HOME) Program Federal Award No.: M17ST660202, M18ST660202 Area: Special Tests and Provisions – Housing Quality Standards Criteria or specific requirement (including statutory, regulatory or other citation): 24 CFR 92.251states: (a) New construction projects — (2) Construction progress and final inspections. The participating jurisdiction must conduct on-site progress and final inspections of construction to ensure that work is done in accordance with the applicable codes, the construction contract, and construction documents. Before completing the project in the disbursement and information system established by HUD, the participating jurisdiction must perform an on-site inspection of the project to determine that all contracted work has been completed and that the project complies with the property standards and requirements in this paragraph (a). All inspections performed by the participating jurisdiction must be conducted in accordance with the participating jurisdiction's inspection procedures. Condition: For all four (100%) new mortgages, aggregating $700,750 of $2,230,031 in total HOME subsidies, the HOME program did not perform final on-site inspections to confirm the housing meets appropriate property standards. Cause: The HOME program does not have formalized monitoring procedures, including detailed review checklists, to ensure that all required documentation is completed and adequately reviewed prior to the approval and disbursement of HOME subsidies. Finding No.: 2025-008, continued Effect or potential effect: GHURA is in noncompliance with applicable special test and provisions requirements. Questioned Costs: $700,750 Identification as a repeat finding: Not applicable. Recommendation: The HOME program should establish and implement a detailed standardized checklists with reviewer controls, to ensure that all required documentation—particularly evidence of final onsite inspections, is completed and reviewed prior to the approval and disbursement of HOME funds. Views of Responsible Officials: Management partially concurs with the finding. Refer to Management’s position as outlined in the Corrective Action Plan. Conclusion: The condition relates to the support available for review for audit submission. We examined all new mortgagee files submitted on April 10, 2026. Management submitted additional information on June 28, 2026; however, due to time constraints, we were unable to sufficiently corroborate and evaluate the documentation provided. Accordingly, the finding remains, as there was insufficient evidence to support a determination of compliance as of the audit date.