We audited the City of Albuquerque’s Community Development Block Grant (CDBG) program based on our risk analysis and as part of the Office of Inspector General’s annual audit plan to review community planning and development funds. The audit objective was to determine whether the City administered its CDBG program in accordance with U.S. Department of Housing and Urban Development (HUD) requirements.
The City did not always properly administer and adequately document its CDBG program activities in accordance with HUD requirements. Specifically, it did not always follow procurement and conflict-of-interest requirements and did not ensure that executed written agreements included the required language. It did not comply with environmental reviews of its projects as the environmental records were not completed correctly and lacked supporting documentation. In addition, it did not ensure that expenditures were reasonable, eligible, and adequately supported as it exceeded allowed residential rehabilitation limits, did not reconcile its timesheet activities, and failed to follow Federal travel regulations. Further, it did not maintain documentation supporting that its projects met a national objective and did not adequately monitor or report on its subrecipients’ results. These conditions occurred because the City did not have the capacity to implement an effective grant administration program. As a result, it incurred grant costs of more than $2.9 million that were ineligible or unsupported and decreased the effectiveness of the CDBG program.
We recommend that the Director of the Albuquerque Office of Community Planning and Development extend the City of Albuquerque’s high risk grantee designation until the City can show that it has implemented an effective program in compliance with all requirements and has repaid the $1.83 million in ineligible costs and supported $1.06 million in unsupported costs identified in this report.
Recommendations
Community Planning and Development
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Status2017-FW-1010-001-AOpenClosed$568,629.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 27, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $568,629 in ineligible costs for its violation of procurement requirements. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-001-BOpenClosed$572,929.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 27, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $572,929 in ineligible costs for its violation of Federal requirements and procurement procedures when it acquired a property with CDBG funding. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-001-COpenClosedClosed on Agosto 28, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to implement technical assistance and guidance received from HUD to ensure compliance with requirements.
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Status2017-FW-1010-001-DOpenClosedClosed on Septiembre 04, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to obtain technical assistance from HUD related to differentiating between subrecipients and contractors and ensuring that the correct procurement requirements are followed when obtaining a subrecipient or contractor.
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Status2017-FW-1010-001-EOpenClosedClosed on Agosto 28, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to update its CDBG written agreements to include the specific language required.
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Status2017-FW-1010-001-FOpenClosedClosed on Septiembre 04, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to develop contracts to include all Federal requirements and to be signed by both the City and the contractors awarded bids with CDBG funding.
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Status2017-FW-1010-001-GOpenClosedClosed on Septiembre 04, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to amend and implement its conflict-of-interest policy and procedures to ensure that it complies with Federal conflict-of-interest requirements and includes elected and appointed positions.
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Status2017-FW-1010-002-AOpenClosed$59,604.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that environmental requirements and client eligibility were met for dental services or repay $59,604 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-002-BOpenClosed$260,000.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that environmental requirements were met for the roof replacement of a food bank or repay $260,000 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-002-COpenClosed$181,053.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that environmental requirements were met for homeowner rehabilitation or repay $181,053 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-002-DOpenClosed$73,186.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $73,186 in ineligible costs for its statutory violation of environmental requirements when it rehabilitated a home without completing the environmental review. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-002-EOpenClosedClosed on Septiembre 04, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to provide training for staff members to ensure that they know their roles and responsibilities with respect to CDBG program oversight and that documentation and other requirements are met.
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Status2017-FW-1010-003-AOpenClosed$507,218.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $507,218 in ineligible costs for its violation of its home rehabilitation policy and procedure when it exceeded the allowed maximum assistance per home with no cost justifications. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-003-BOpenClosed$110,647.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $110,647 in ineligible costs for the rehabilitation costs that exceeded the allowed HOME value limits. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-003-COpenClosed$474.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $474 in ineligible costs for violation of Federal travel regulations. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-003-DOpenClosed$9,476.00Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reclassify the $9,476 to program administration and recalculate its cap to determine whether it exceeded the allowed 20 percent. Any amount that is over the allowed cap would be ineligible, and repayment of the overage amount to its CDBG line of credit would be required. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-003-EOpenClosed$69,254.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support payroll wages charged to the CDBG grant or repay $69,254 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-003-FOpenClosedClosed on Septiembre 13, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to implement recommendations made from its internal and external auditors that will ensure compliance with applicable regulations related to cost reasonableness and eligibility and that costs are adequately supported.
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Status2017-FW-1010-004-AOpenClosed$123,831.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that subrecipient 1 met a national objective, environmental requirements, and client eligibility or repay $123,831 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-004-BOpenClosed$69,000.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that subrecipient 2 met a national objective, environmental requirements, and client eligibility or repay $69,000 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-004-COpenClosed$304,975.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to support that subrecipient 3 met a national objective, environmental requirements, and client eligibility or repay $304,975 to its CDBG line of credit from non-Federal funds.
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Status2017-FW-1010-004-DOpenClosed$565.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $565 in ineligible costs for its failure to provide subrecipient oversight, which should have identified that the subrecipient had incorrectly applied eligibility requirements for homeless clients served. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-004-EOpenClosed$1,400.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on Agosto 28, 2018We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to reimburse its CDBG line of credit for $1,400 in ineligible costs for its failure to provide subrecipient oversight, which should have identified the ineligibility of clients whose income exceed the threshold as reported. Reimbursement must be from non-Federal funds.
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Status2017-FW-1010-004-FOpenClosedClosed on Septiembre 13, 2018
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development require the City of Albuquerque’s Department of Family and Community Services to develop and implement written CDBG policies and procedures, which detail the requirements, including but not limited to (1) meeting Federal procurement requirements, (2) executing written agreements for all subrecipients and contractors that meet minimum requirements, (3) documenting all conflicts of interest, (4) complying with HUD environmental review requirements, (5) maintaining documentation to support that its CDBG-funded projects met one or more national objectives, (6) properly and accurately monitoring subrecipients for compliance with all requirements, and (7) consistently and accurately reporting activities in IDIS.
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Status2017-FW-1010-004-GOpenClosedClosed on Marzo 22, 2019
We recommend that the Director of HUD’s Albuquerque Office of Community Planning and Development continue to classify the City of Albuquerque as a high risk grantee until such time as HUD has determined the City has implemented an effective program in compliance with all requirements.