We recommend that HUD’s Deputy Assistant Secretary for Grant Programs require the City to provide documentation showing that it has strengthened its invoice review process to ensure that costs are eligible and supported before disbursing disaster funds to its subrecipient under the program.

Develop and implement controls over owner contributions and owner distributions to ensure compliance with its regulatory agreement and HUD regulations.

Complete HUD-approved training regarding owner contributions and distributions.

Repay its project’s operating account for the ineligible $15,000 disbursement from non-project funds.

Perform an analysis of all security deposits and ensure that the security deposit account is fully funded.

Implement controls to ensure existing procedures are followed to maintain the project’s security deposit funds separately from all other accounts by depositing and disbursing all security deposit funds directly into and from the security deposit account.

Develop and implement controls to ensure that policies and procedures for account executives are continually reviewed and updated to reflect changes in Ginnie Mae’s operations.

Develop and implement controls to review issuers to determine the total impact of a large or multiple-issuer default, the maximize-size default Ginnie Mae can adequately execute, and an issuer’s ability to adapt to changing market conditions.

Develop and implement controls to continually assess skills required to meet organizational goals to include a plan to prioritize resources to accommodate changing organizational needs.

Develop and implement training programs to ensure that employee skill levels are developed to meet changing organizational needs to include secondary market training.

Support that $2,533,377 in costs were reasonable and allowable program expenses in accordance with requirements or repay from non-Federal funds the appropriate programs any amounts they cannot support.

Repay the appropriate programs from non-Federal funds the $1,524,604 in ineligible funds paid when costs exceeded contract terms.

Determine the appropriateness of the remaining balance of $1,242,154 on unsupported contracts to ensure costs were reasonable, reprocure the subject contracts, or reallocate the funds to the appropriate program.

Reprocure expired service contracts to ensure estimated balances of $375,526 are used on eligible contract.

Reprocure any service contracts necessary and ensure that the contracts are properly awarded in accordance with HUD requirements.

Strengthen and implement controls and procedures over procurement, including monitoring consultants, to ensure that procurement activities meet HUD requirements.

Establish and implement an effective system to ensure that payments do not exceed approved contract values.

Establish and implement an effective system to maintain a complete and accurate contract register to ensure proper contract planning and administration.

Provide technical assistance to the Authority to ensure that responsible staff and board members receive necessary procurement training.

Take appropriate steps to establish eligibility for collection termination or compromise for 10 debts totaling $1,210,278,5 including three debts that were closed without required DOJ approval. For debts that have a remaining appropriate means of collection, such as demand letters, administrative offset, or referral to Treasury, HUD should reinstate the debt and resume collections.