The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

Adequately support the eligibility of payroll costs or repay its CoC grants $824,302 from non-Federal funds.

Adequately support the eligibility of rent costs or repay its CoC grants $55,545 from non-Federal funds.

Develop and implement additional written procedures and controls to ensure that employees charge time in accordance with program requirements and that the Authority fully documents and supports that salary and rental cost allocations are charged to its CoC grants in accordance with its cost allocation plan.

Develop and implement written policies and procedures regarding the designation of legal representation for applicants.

Develop a departmentwide human capital plan or evaluate and revise existing plans to guide the recruitment, retention, and skill development of staff involved in IT acquisitions. The plan should include related metrics to measure plan implementation and effectiveness.

Evaluate IT acquisition process workflows and identify ways to simplify the processes, facilitate more effective stakeholder coordination across offices, and create efficiencies when possible.

Establish a centralized acquisition tracking system that allows for input and monitoring by all offices involved with the IT acquisition process by: a. Developing a plan with detailed implementation milestones; b. Obtaining appropriate approvals and funding; and c. Implementing a centralized acquisition tracking system, based on the implementation plan and approvals from 4a and 4b.

Complete a program-specific fraud risk assessment and risk profile for the CDBG and ESG programs, with emphasis on CARES Act funding, and replicate this process to create program-specific fraud assessments and risk profiles for other CPD programs.

Consider OIG’s fraud risk inventory to improve CPD’s own fraud risk assessments and develop a program-specific fraud risk map and compendium.

Implement efforts to increase the awareness of fraud at all levels (headquarters, field offices, grantees, subrecipients, etc.), including but not limited to regularly publishing articles on known fraud schemes and identified instances of fraud in periodic newsletters or on CPD’s intranet website, providing recurring fraud risk trainings to HUD employees and grantees and working with OIG to develop materials to support fraud awareness.

Develop and implement a fraud risk checklist or other instrument as part of CPD’s monitoring oversight requirements, to be completed as part of each remote and onsite monitoring review.

Develop and implement a fraud analytics strategy using available data, including but not limited to data and information collected during the grantee risk assessment and monitoring processes, to begin conducting data analyses to identify potential fraud risks for further review.

Establish and implement a process to ensure that The Office of Multifamily Housing Programs’ policies, procedures, and supervisory controls are effective. This process should include addressing postdisaster damage assessments, properly updating iREMS, and executing loan forbearances. This process should also integrate with other HUD program offices as appropriate to improve consistency with HUD’s overall disaster response and to ensure the effectiveness of disaster controls.

Provide documentation to support that $658,261 in loan proceeds was used for an eligible NSP2 activity or property or repay the program from non-Federal funds.

Provide documentation to support that $500,000 in NSP funds transferred to the revolving loan fund was used for an eligible NSP2 activity or property or repay the program from non-Federal funds.

Amend the NSP2 action plan to include its revolving loan fund.

Adjust program income calculation methodology to ensure it is in accordance with HUD requirements.

Submit overdue NSP2 quarterly reports to DRGR and update prior reports that did not accurately report program income activity.

Provide adequate documentation to support its administrative and project delivery cost expenditures or repay the program $1,388,545 from non-Federal funds.