Provide documentation to support the $8,919 in NSP funds spent on rehabilitation costs or repay to the program from non-Federal funds.

Provide documentation to support a reconciliation between financial records and DRGR and report in HUD’s DRGR system the appropriate amount of program income generated from all NSP1 and NSP3 funds from the inception of the grants.

Provide documentation to support that all NSP properties are properly classified and recorded in HUD’s DRGR system.

Develop and implement policies and procedures to include but not be limited to oversight, effective internal controls, separation of duties, procurement, and overall administration of the program.

Conduct a review of the remaining 10 properties not reviewed during our audit to ensure compliance with HUD requirements and identify and repay costs related to ineligible or unsupported activities (see appendix C).

For Property 1504, provide documentation to support the recording in HUD’s DRGR system, the repayment of $144,004 in NSP funds and $1,120 in program income.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to repay its HOME program from non-Federal funds $1,322,280, which it misspent reconstructing homes.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to ensure that staff responsible for environmental reviews understands and complies with environmental requirements.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to hire a qualified entity to determine and correct deficiencies related to 13 reconstructed homes, including the structural integrity of the homes.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to provide a detailed plan for covering the cost of any potential warranty work needed on these 13 properties for the entire statutory warranty period.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to support or reduce its match contributions by $2,967,568 and review its HOME match contributions for the past 5 years for compliance with HOME regulations and report the results to the Fort Worth Office of Community Planning and Development.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to develop and adopt policies and procedures to address HOME match contribution requirements.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to ensure that the loan agreements are signed and valid legal instruments.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to develop policies and procedures, to include the review of all subcontractors in SAM.

We recommend that the Fort Worth Office of Community Planning and Development Director require the City to ensure that its staff understands and complies its policies and procedures including HOME income requirements.

We recommend that HUD’s Acting Director for the Office of Block Grant Assistance require the Texas General Land Office to review and update its internal controls throughout the grant cycle to ensure that the procurement and expenditure policies and procedures are implemented and working as designed, including the Federal prohibition of cost plus percentage of cost contracts.

We recommend that HUD’s Acting Director for the Office of Block Grant Assistance require the Texas General Land Office to fill vacancies, ensuring that staffing levels remain adequate to administer Hurricane Harvey disaster grant funds.

We recommend that HUD’s Acting Director for the Office of Block Grant Assistance require the Texas General Land Office to negotiate with SBA to extend its data-sharing agreements for the term of the expenditure requirements set forth in public laws or the Federal Register.

We recommend that HUD’s Acting Director for the Office of Block Grant Assistance require the Texas General Land Office to initiate negotiations with the Texas Department of Insurance to establish data-sharing agreements for the Hurricane Harvey disaster, any open disaster recovery grants, and future disasters.

We recommend that HUD’s Acting Director for the Office of Block Grant Assistance require the Texas General Land Office to ensure that false statement and false claim warnings are included in all of its contract-related forms.