We are conducting an audit of the City of Jersey City’s Community Development Block Grant (CDBG) program based upon an Office of Inspector General (OIG) hotline complaint containing several allegations, one of which was that the City’s Division of Community Development’s lead risk assessor was not qualified or producing monitoring reports for rehabilitation work funded under the City’s Homeowner Rehabilitation Program.  The objective of our review is to determine whether the complaint allegations had merit.  During our review of 10 homeowner rehabilitation activities funded under the City’s program, incidents of noncompliance with CDBG program lead paint requirements raised an issue of concern requiring immediate corrective action.  Our review determined that there was no assurance that the household members of the homes rehabilitated with CDBG funds were not at risk of lead paint hazards, that lead paint dust did not exist after rehabilitation work was completed at the 27 homes rehabilitated with CDBG funds in program years 2012 and 2013, and that the City’s XRF lead analyzer complied with New Jersey administrative codes.  We attributed these deficiencies to the City staff’s unfamiliarity with CDBG program requirements and improper supervision of the City’s lead risk assessment process. 

We recommend that City officials (1) notify the two homeowners that lead dust existed in their homes after the rehabilitation work was completed and that it exceeded HUD’s allowable lead limits, (2) collect and test lead dust samples from the floors and window sills of  the 27 homeowner  units that received CDBG funds in program years 2012 and 2013 to ensure that the lead dust  does not exceed the allowable lead dust standards.  If the tests reveal the existence of excessive lead dust, City officials need to reduce the lead dust to the allowable limit, or reimburse the City’s CDBG line of credit from non-Federal funds for disbursements previously made to repair those 27 units, (3) strengthen the City’s administrative controls to ensure that the lead risk assessment conducted after the completion of rehabilitation work is adequately documented, (4) strengthen the City’s administrative controls to ensure that adequate documentation is maintained to support compliance with the Federal and State lead requirements, (5) provide documentation to support that the City’s XRF lead analyzer is registered with the State of New Jersey as required, and (6) provide lead hazard training to the City’s lead risk assessor to ensure compliance with Federal and State requirements.