We completed an audit of the City of Eagle Pass Housing Authority’s (Authority) American Recovery and Reinvestment Act of 2009 (Recovery Act) grant activities. The Authority was selected based on the U.S. Department of Housing and Urban Development’s (HUD), Office of the Inspector General’s (OIG)  annual plan to conduct oversight of the Recovery Act funds provided to public housing agencies and our regional risk evaluation.  Our audit objective was to determine whether the Authority (1) properly obligated and spent its Recovery Act formula grant funds, and (2) properly obtained its Recovery Act contracts.

The Authority generally had adequate policies, procedures, and controls to oversee its obligation and expenditure of Recovery Act funds.  In addition, it properly obtained its Recovery Act funded contracts in accordance with HUD requirements.  However, the Authority made a minor contracting error as it did not ensure one professional service contract had required contract term limits.  The Authority did not include the contract term limits because it was unaware of HUD’s requirements.  By not adopting term limits in its contract, the Authority cannot be sure it is receiving the best price for goods and services under full and open competition.

We recommend that HUD’s Director of the San Antonio Office of Public Housing instruct the Authority to add a term limit to its current architectural and engineering professional service contract and any other open ended contracts currently in effect, and adopt a procurement procedure that ensures future contracts contain the required contract limit maximums