In accordance with our regional plan to review public housing programs and as part of our overall risk strategy to review smaller housing authorities, we reviewed the Housing Authority of the City of Beeville, TX.  Our objective was to determine whether the Authority operated its public housing and related grant programs in accordance with the U.S. Department of Housing and Urban Development’s (HUD) requirements.  However, we limited our review to determining whether the Authority (1) properly collected, deposited, and recorded its low-rent rental receipts; (2) had adequate controls over its credit cards; and (3) made additional or improper payroll payments.  We also reviewed board oversight and expanded our testing to cover other high-risk disbursements. 

The Authority’s management did not properly manage its public housing and related grant programs in accordance with HUD requirements.  Specifically, it (1) did not properly oversee its rent receipts, (2) mismanaged its credit cards and vehicles, (3) paid ineligible and unsupported costs, and (4) failed to hold regular board meetings.  These conditions occurred because the Authority’s management, consisting of its executive director and board of commissioners, did not exercise adequate oversight of and control over the Authority.  Further, management did not ensure that staff followed policies, procedures, and controls.  As a result, the Authority’s tenant accounts receivable balances were inaccurate, and it overcharged a few tenants.  Additionally, it paid ineligible and unsupported costs totaling $75,583.

We recommended that HUD’s Office of Public Housing require the Authority to 1) implement or update its internal controls, policies and procedures; 2) support or repay questioned costs; 3) hold regular board meetings that provide adequate oversight; and 4) consult with the Mayor of Beeville to evaluate the board of commissioner and remove and replace commissioners as appropriate.