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We completed a review of HUD’s monitoring and administration of the Housing Choice Voucher Family Self-Sufficiency (HCV FSS) program.  The review was included in OIG’s annual audit plan and contributes to OIGs objective of improving HUD’s execution of and accountability for grant funds.  The objectives of the review were to determine whether HUD officials sufficiently monitored public housing agencies (PHA) to encourage the use of the program, evaluate its outcome, and ensure that PHAs properly monitor the participating families’ progress while in the program and upon graduation and document the program benefit.

Our review determined that due to the priority of the HCV program over the FSS program and a lack of resources, HUD officials did not (1) sufficiently monitor PHAs, (2) encourage the use of the FSS program, (3) evaluate its overall outcome, and (4) determine whether PHAs properly monitored the participating families’ progress while in the program.  In addition, HUD officials did not require PHAs to track participating families after program graduation and document the program benefit in terms of realized cost savings resulting from reduced or eliminated rental assistance.

We recommend that HUD’s Assistant Secretary for Public and Indian Housing develop policies and procedures to periodically verify the timeliness, completeness, and accuracy of key performance data, such as FSS enrollment, participant progress, escrow accounts, and program exits that PHAs self-report through PIC.  In addition, if the fiscal year 2014 program coordinator funding for HCV FSS and PH FSS is combined, consider disbursing the new grant through LOCCS, which would require PHAs to request the grant payments and enable HUD officials to manually approve payment requests, if necessary, to prevent the misuse of funds or ensure that required performance reports are submitted.  Also, establish and implement a system to identify best practices and recommendations that would improve the effectiveness of the HCV FSS program.