What We Audited and Why 

We audited the East St. Louis Housing Authority (Authority) because of a hotline complaint alleging that Authority’s management misused U.S. Department of Housing and Urban Development (HUD) funds.  Our audit objective was to determine whether the Authority followed HUD’s regulations and its own policies when procuring goods and services, granting leave, and managing vehicle operations.

What We Found  

The Authority improperly procured goods and services by not following HUD regulations or its own procurement policy and has no assurance that it received the best value or paid a reasonable amount on procurement actions totaling $705,764. The Authority also improperly granted leave to employees in exchange for contributions to the United Way, spending $147,934 that should have gone toward ensuring decent, safe, and sanitary housing for its residents. In addition, the Authority poorly managed its general vehicle operations, incurring excess vehicle costs totaling $36,554. 

What We Recommend  

We recommend that HUD require the Authority to improve its procurement controls by developing clearly written policies and procedures and repay from nonfederal sources the $147,934 improperly spent for employee leave. We also recommend that HUD require the Authority to improve its controls over vehicle operations, dispose of unnecessary vehicles, and repay from nonfederal sources the $29,095 improperly spent on vehicle allowances. For each recommendation without a management decision, please respond and provide status reports in accordance with HUD Handbook 2000.06, REV-3.  Please furnish us copies of any correspondence or directives issued because of the audit.