FAC Explorer

Finding 498457 (2023-006)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2023
Accepted
2024-09-26
Audit: 321162
Organization: City of Baton Rouge - Parish of East Baton Rouge (LA)
Auditor: Eisneramper

AI Summary

  • Core Issue: The City-Parish lacks required architect certifications for HOME-funded projects, risking unallowable costs.
  • Impacted Requirements: Best practices for internal controls are not being followed, as site inspections are inadequately documented and performed by unqualified personnel.
  • Recommended Follow-Up: Implement architect certifications for all construction projects or ensure site inspections are conducted by qualified personnel with proper documentation.

Finding Text

Internal Controls over Project Costs Questioned Costs: Undetermined Department of Housing and Urban Development 14.239 Home Investment Partnerships Program (HOME) Grant No(s): M-21-MC-22-0204, M-22-MC-22-0204 Criteria: Best practices in internal controls for construction projects suggests that application for payment be accompanied by architect certifications or construction site inspections by qualified personnel prior to payments to contractors or developers. Condition: The City-Parish does not require architect certifications prior to disbursement of funds for its HOME-funded housing projects under construction. Site inspections are conducted by City-Parish personnel, but they are inadequately documented and performed by office personnel. Universe/ Population: Our test of costs charged to the program included four projects involving construction or physical plant improvements. None of them had architect certifications. Effect: Without authoritative architect certification and/ or adequately documented site inspection, the City-Parish may be at risk of incurring unallowable or wasteful program costs. Cause: The Program believes the certifications are not required by the program and are not cost-beneficial given the relatively small size of their projects. Recommendation: Architectural certifications should be performed for construction projects. If the decision is to forego such certifications, then sections should be performed by qualified personnel and adequately documented. View of Responsible Official: Architect certification is not required by the Department of Housing and Urban Development nor our policies and procedures. It is listed in our contracts as one of the many different types of reimbursement documentation our office will accept. For many projects, an architect certification for each draw would be financially prohibitive and would likely reduce the financial viability of affordable housing developments. Our office does conduct intermittent on-site or desktop monitoring throughout the course of the project to ensure evidence activities. Additionally, all construction projects must complete permit requirements to ensure housing quality. Evidence of monitoring or activity was provided to the auditors.

Corrective Action Plan

Management’s response and corrective action is as follows: Architect certification is not required by the Department of Housing and Urban Development nor our policies and procedures. It is listed in our contracts as one of the many different types of reimbursement documentation our office will accept. For many projects, an architect certification for each draw would be financially prohibitive and would likely reduce the financial viability of affordable housing developments. Our office does conduct intermittent on-site or desktop monitoring throughout the course of the project to ensure evidence activities. Additionally, all construction projects must complete permit requirements to ensure housing quality. Evidence of monitoring or activity was provided to the auditors. Expected Implementation Date: October 2024 Contact person: Marlee Pittman Miller, Director, Mayor-President’s Office of Community Development

Categories

Subrecipient Monitoring Allowable Costs / Cost Principles Cash Management Internal Control / Segregation of Duties

Other Findings in this Audit

  • 498454 2023-003
    - Repeat
  • 498455 2023-004
    Significant Deficiency
  • 498456 2023-005
    Significant Deficiency
  • 498458 2023-007
    Material Weakness Repeat
  • 498459 2023-008
    Material Weakness Repeat
  • 498460 2023-009
    Significant Deficiency
  • 498461 2023-009
    Significant Deficiency
  • 498462 2023-009
    Significant Deficiency
  • 498463 2023-010
    Significant Deficiency
  • 498464 2023-010
    Significant Deficiency
  • 498465 2023-010
    Significant Deficiency
  • 1074896 2023-003
    - Repeat
  • 1074897 2023-004
    Significant Deficiency
  • 1074898 2023-005
    Significant Deficiency
  • 1074899 2023-006
    Significant Deficiency
  • 1074900 2023-007
    Material Weakness Repeat
  • 1074901 2023-008
    Material Weakness Repeat
  • 1074902 2023-009
    Significant Deficiency
  • 1074903 2023-009
    Significant Deficiency
  • 1074904 2023-009
    Significant Deficiency
  • 1074905 2023-010
    Significant Deficiency
  • 1074906 2023-010
    Significant Deficiency
  • 1074907 2023-010
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $42.80M
21.023 Emergency Rental Assistance Program $9.04M
20.205 Highway Planning and Construction $7.79M
20.106 Airport Improvement Program, Covid-19 Airports Programs, and Infrastructure Investment and Jobs Act Programs $7.43M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $5.22M
97.039 Hazard Mitigation Grant $5.18M
97.029 Flood Mitigation Assistance $5.12M
93.914 Hiv Emergency Relief Project Grants $5.04M
93.686 Ending the Hiv Epidemic: A Plan for America � Ryan White Hiv/aids Program Parts A and B $1.97M
93.137 Community Programs to Improve Minority Health Grant Program $1.92M
17.259 Wioa Youth Activities $1.70M
93.569 Community Services Block Grant $1.38M
17.278 Wioa Dislocated Worker Formula Grants $1.19M
20.930 Payments for Small Community Air Service Development $1.00M
14.231 Emergency Solutions Grant Program $972,687
17.258 Wioa Adult Program $904,123
93.600 Head Start $674,944
10.558 Child and Adult Care Food Program $661,662
20.600 State and Community Highway Safety $639,142
14.218 Community Development Block Grants/entitlement Grants $573,380
97.067 Homeland Security Grant Program $350,265
14.239 Home Investment Partnerships Program $137,394
95.001 High Intensity Drug Trafficking Areas Program $120,643
93.658 Foster Care Title IV-E $103,567
20.607 Alcohol Open Container Requirements $86,780
20.616 National Priority Safety Programs $82,655
16.609 Project Safe Neighborhoods $75,354
93.568 Low-Income Home Energy Assistance $73,314
93.493 Congressional Directives $63,633
97.042 Emergency Management Performance Grants $61,405
97.024 Emergency Food and Shelter National Board Program $57,923
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $26,525
16.738 Edward Byrne Memorial Justice Assistance Grant Program $19,352
14.905 Lead Hazard Reduction Demonstration Grant Program $18,255
15.904 Historic Preservation Fund Grants-in-Aid $13,000
16.034 Coronavirus Emergency Supplemental Funding Program $7,205
21.009 Volunteer Income Tax Assistance (vita) Matching Grant Program $6,688
93.069 Public Health Emergency Preparedness $5,397
14.241 Housing Opportunities for Persons with Aids $1,995
66.818 Brownfields Multipurpose, Assessment, Revolving Loan Fund, and Cleanup Cooperative Agreements $1,947
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $334
17.277 Wioa National Dislocated Worker Grants / Wia National Emergency Grants $-90