We audited the Housing Authority of the Township of Irvington, NJ, regarding the administration of its public housing program because it was classified as a troubled public housing agency and based on a complaint from the union representing its maintenance and clerical employees. The complaint alleged serious financial and operational mismanagement. The audit objectives were to determine whether the issues identified in the complaint could be substantiated and whether the Authority administered its public housing program in accordance with U.S. Department of Housing and Urban Development (HUD) regulations and had sufficient financial controls.
The allegations in the complaint regarding serious financial and operational mismanagement were valid. Authority officials did not always administer the Authority’s public housing program in accordance with program requirements. Specifically, officials spent program funds for unsupported and ineligible costs, excessive compensation was provided to the former executive director, HUD was not notified about litigations, deficiencies were noted in rent collection, program income was spent for ineligible and unsupported costs, and controls over procurement were inadequate. We attributed these deficiencies to the Authority officials’ unfamiliarity with program requirements, disregard for the financial condition of the Authority, and failure to establish a proper control environment. As a result, HUD had no assurance that $1.2 million in expenditures charged by the Authority was eligible and adequately supported.
We recommended that HUD require Authority officials to (1) reimburse the public housing program from non-Federal funds for $95,240 in ineligible expenditures, (2) provide supporting documentation to justify $1.1 million in unsupported expenditures charged to the public housing program or repay the program from non-Federal funds, and (3) establish adequate controls to ensure compliance with program requirements. We also recommend that the Director of HUD’s Departmental Enforcement Center pursue administrative sanctions against any current or former Authority officials found to have spent public housing program funds for personal or unallowable use.
Recommendations
Public and Indian Housing
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Status2017-NY-1008-001-AOpenClosed$88,534.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide supporting documentation to justify the $88,534 in unsupported travel and training costs related to out-of-State trainings, meetings, and conferences. Any amount determined to be ineligible should be repaid from non-Federal funds to the Operating Fund.
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Status2017-NY-1008-001-BOpenClosed$27,599.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide supporting documentation to justify the $27,599 in unsupported training travel and per diem expenses related to quarterly meetings and trainings offered by HAI. Any amount determined to be ineligible should be repaid from non-Federal funds to the Operating Fund.
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Status2017-NY-1008-001-COpenClosed$27,487.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide supporting documentation to justify the $27,487 reimbursed to Authority officials for various costs, such as health coverage waiver incentives, supplies, food, and decorations. Any amount determined to be ineligible should be repaid from non-Federal funds to the Operating Fund.
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Status2017-NY-1008-001-DOpenClosedClosed on Marzo 29, 2019
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to implement policies and procedures to ensure accountability for travel and training costs and require the Authority to maintain adequate supporting documents for travel, training, health coverage waiver incentives, supplies, food, decorations, and any other costs charged to the Capital Fund and Operating Fund to ensure that costs were actually incurred, necessary, reasonable and allowable.
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Status2017-NY-1008-001-EOpenClosed$61,145.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to reimburse the Operating Fund from non-Federal funds for $61,145 in ineligible expenditures for personal expenses, such as meals, grocery items, gift cards, flowers, golf, an award dinner, Costco and AAA memberships, and a church deduction.
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Status2017-NY-1008-001-FOpenClosed$8,190.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to reimburse the Operating Fund from non-Federal funds for $8,190 in ineligible salary advance.
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Status2017-NY-1008-001-GOpenClosed$4,048.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to reimburse the Operating Fund from non-Federal funds for the $4,048 in ineligible civil service fines.
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Status2017-NY-1008-001-HOpenClosed$90,000.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to obtain retroactive approval from HUD for the $90,000 lawsuit settlement related to a former employee. If approval is not obtained, the Authority should reimburse $90,000 to the Operating Fund from non-Federal funds.
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Status2017-NY-1008-001-IOpenClosedClosed on Marzo 29, 2019
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to obtain retroactive approval from HUD for the pending litigation related to issues with the elevators. If approval is not obtained, the Authority should withdraw the lawsuit.
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Status2017-NY-1008-001-JOpenClosed$13,340.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide documentation to support that $13,340 in rent collected in March 2016 was deposited into an appropriate bank account or repay the Operating Fund from non-Federal funds for any amount not properly deposited.
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Status2017-NY-1008-001-KOpenClosed$106,971.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide documentation to justify the $106,971 in unsupported rent that was written off for 52 tenants. Any amount determined to be ineligible should be repaid from non-Federal funds to the Operating Fund.
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Status2017-NY-1008-001-LOpenClosed$7,164.00Questioned 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 Junio 11, 2019We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to collect $7,164 in outstanding rent from the resident commissioner and if past-due rent is not paid, take appropriate legal action.
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Status2017-NY-1008-001-MOpenClosed$21,857.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to reimburse the program income account from non-Federal funds for $21,857 in ineligible expenditures for golf outings, banquets, or dinner shows.
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Status2017-NY-1008-001-NOpenClosed$37,671.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide documentation to justify $37,671 that did not have receipts or other support showing how these transactions were used for low-income housing and benefited the residents or repay the program income account from non-Federal funds for any amount not supported.
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Status2017-NY-1008-001-OOpenClosedClosed on Marzo 29, 2019
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to develop and implement an appropriate policy for program income, including the proper use, accounting, and reporting of program income in accordance with the Federal definition and treatment of program income.
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Status2017-NY-1008-001-POpenClosed$710,721.00Questioned 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.
We recommend that the Acting Director of HUD’s Newark Office of Public Housing instruct Authority officials to provide documentation to show that the $710,721 paid for services procured was for costs that were reasonable or repay from non-Federal funds approximately $500,000 to the Operating Fund and approximately $200,000 to the Capital Fund. Footnote: Regulations at 24 CFR 905.306(f) require that all capital funds be spent within 48 months after the date on which they become available. Funds that have not been properly spent within 48 months have to be recaptured and returned to the U.S. Treasury.
General Counsel
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Status2017-NY-1008-001-QOpenClosedClosed on Diciembre 13, 2018
We recommend that the Director of HUD’s Departmental Enforcement Center pursue administrative sanctions against any current or former Authority officials found to have spent public housing program funds for personal or unallowable use.