We completed a capacity review of the Los Angeles County Community Development Commission’s (County) Neighborhood Stabilization Program. We performed the audit because Housing and Economic Recovery Act reviews were part of the Office of the Inspector General’s annual audit plan and the program was identified as high risk. In addition, the County was awarded significant Neighborhood Stabilization Program funds of $16.8 million. Our objective was to determine whether the County had sufficient capacity and the necessary controls to manage and administer the Neighborhood Stabilization Program. We found no evidence indicating that the County lacked the capacity to adequately administer its current Neighborhood Stabilization Program funding. The County has applied for additional funding under the American Recovery and Reinvestment Act of 2009 to continue its Neighborhood Stabilization Program activities and based on our review, its procedures and controls should be adequate to administer the continuation of the program.