We audited the Port Huron Housing Commission’s public housing program as part of the activities in our fiscal year 2016 annual audit plan. We selected the Commission based on our analysis of the risk factors relating to public housing agencies in Region 5’s 1 jurisdiction. Our objective was to determine whether the Commission administered its program in accordance with the U.S. Department of Housing and Urban Development’s (HUD) and its own program requirements.
The Commission did not properly implement asset management. Specifically, it inappropriately allocated more than $1.4 million in expenses incurred by its central office cost center to its asset management projects. As a result, HUD and the Commission lacked assurance that the costs allocated to the Commission’s projects were (1) necessary and reasonable and (2) for eligible program-related activities or services received by the projects.
We recommend that the Director of the Detroit Office of Public Housing require the Commission to (1) support that $1.4 million in central office cost center expenses allocated to the public housing program were eligible, necessary, and reasonable program costs and (2) implement adequate procedures and controls to address the issue cited in this report.
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1 Region 5 includes the States of Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin.
Recommendations
Public and Indian Housing
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Status2017-CH-1001-001-AOpenClosed$1,432,222.00Questioned 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 Abril 04, 2018Support that $1,432,222 in central office cost center expenses allocated to the public housing program projects were eligible, necessary, and reasonable costs of the program. Costs that cannot be supported, or were unnecessary, unreasonable, or for ineligible program costs should be reimbursed to the program from non-Federal funds.
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Status2017-CH-1001-001-BOpenClosedClosed on Abril 12, 2018
Implement adequate procedures and controls, including but not limited to developing a plan to manage its central office cost center expenses and determining an appropriate fee structure with HUD’s approval that would allow it to operate its program within HUD’s requirements.
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Status2017-CH-1001-001-COpenClosedClosed on Marzo 26, 2018
Implement adequate procedures and controls, including but not limited to providing training to its staff to ensure that the Commission fully implements asset management and operates its program in accordance with HUD’s requirements.