U.S. flag

An official website of the United States government Here’s how you know

The .gov means it’s official.

Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.

The site is secure.

The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Línea Directa

REPORTAR FRAUDE, DESPERDICIO O ABUSO
Mayo 11, 2009
2009-CH-1008
2009-ch-1008.pdf

The U.S. Department of Housing and Urban Development's (HUD) Office of Inspector General audited the City of East Cleveland's (City) use of HOME Investment Partnerships (HOME) and Community Development Block Grant (Block Grant) program funds. The audit was part of the activities in our fiscal year 2008 annual audit plan. We selected the City based upon our analysis of risk factors relating to HOME grantees in Region V's jurisdiction and a request from HUD's Columbus Office of Community Planning and Development. Our audit objectives were to determine whether the City effectively administered its HOME and Block Grant programs; appropriately disbursed HOME funds for owner-occupied, single-family residential rehabilitation projects (rehabilitation projects), community housing development organization projects (organization projects), and grant assistance program financing activities (financing activities); appropriately drew down and disbursed Block Grant funds; and followed HUD's requirements.

The City did not effectively administer its HOME and Block Grant programs. It lacked documentation to support its use of nearly $444,000 in HOME funds for 12 rehabilitation projects and four financing activities; inappropriately disbursed nearly $60,000 in HOME funds for a rehabilitation project that did not meet HUD's property standards requirements and had unused prepurchased construction materials for three organization projects; and provided nearly $97,000 and committed more than $24,000 in HOME funds for an improper organization project.

The City also failed to disburse Block Grant funds drawn down from its line of credit within a reasonable number of days and lacked documentation to support that it used Block Grant funds for appropriate expenses. As a result, HUD lost more than $4,000 in interest on the more than $183,000 in Block Grant funds that the City failed to disburse within a reasonable number of days, and the City was unable to support its use of nearly $5,000 in Block Grant funds for eligible costs.

We recommend that the Director of HUD's Columbus Office of Community Planning and Development require the City to (1) provide documentation or reimburse its HOME and Block Grant programs nearly $449,000 from nonfederal funds for the unsupported payments, (2) reimburse its HOME and Block Grant programs more than $156,000 from nonfederal funds for the improper use of funds, (3) decommit more than $24,000 in HOME funds inappropriately committed for an organization project, (4) disburse or reimburse HUD for nearly $32,000 in Block Grant funds not disbursed, (5) reimburse HUD more than $4,000 from nonfederal funds for the interest HUD lost on the Block Grant funds that the City failed to disburse within a reasonable number of days of being drawn down from its line of credit, and (6) implement adequate procedures and controls to address the findings cited in this audit report.