We audited the Buffalo Municipal Housing Authority based on our risk analysis of public housing agencies that fall under the jurisdiction of the U.S. Department of Housing and Urban Development’s (HUD) Buffalo, NY, field office. The objective of our audit was to determine whether the Authority administered its operating funds in accordance with applicable HUD, Federal, and Authority requirements.
We found that the Authority did not administer its operating funds in accordance with applicable HUD, Federal, and Authority requirements. Specifically, it (1) did not properly procure goods and services with related operating fund disbursements and (2) improperly requested, received, and used operating funds. These issues occurred because the Authority did not fully understand applicable requirements and did not have adequate controls to ensure compliance with HUD, Federal, and Authority requirements. As a result, HUD did not have assurance that (1) the Authority conducted procurements in a manner that provided full and open competition, (2) more than $1.4 million in operating funds paid under five contracts and to two vendors for purchase orders was for prices that were fair and reasonable, and (3) $464,166 in operating funds was available and used for its intended purpose.
We recommend that HUD require the Authority to (1) provide documentation to show that more than $1.4 million in operating funds paid under five contracts and to two vendors for purchase orders was for prices that were reasonable; (2) evaluate apparent conflict-of-interest situations and pursue administrative sanctions if warranted; (3) provide documentation to justify $372,695 in unsupported Operating Fund subsidies received and $8,564 in excessive property management fees charged; (4) reimburse its Operating Fund account from non-Federal funds $82,907 for document management services contract payments that should have been paid with non-Federal funds; (5) strengthen its controls to ensure compliance with HUD, Federal, and Authority requirements; and (6) provide training to employees involved in the procurement, funding, and expenditure processes to ensure compliance with HUD, Federal, and Authority requirements.
Recommendations
Public and Indian Housing
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Status2018-NY-1006-001-AOpenClosed$583,920.00Questioned 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 September 22, 2020We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide documentation to show that the $583,920 paid to two vendors for purchase orders below the Authority’s micropurchase limit was for prices that were reasonable or reimburse its Operating Fund from non-Federal funds for any amount that it cannot support or is not considered reasonable.
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Status2018-NY-1006-001-BOpenClosed$842,931.00Questioned 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 September 28, 2020We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide documentation to show that $842,931 paid under five contracts was for prices that were reasonable or reimburse its Operating Fund for any amount that it cannot support or is not considered reasonable.
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Status2018-NY-1006-001-COpenClosedClosed on September 14, 2020
We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to strengthen its controls over purchases to ensure compliance with HUD, Federal, and Authority procurement requirements. This includes, but is not limited to, controls to ensure that it (1) maintains records sufficient to detail the significant history of procurements, (2) complies with requirements for each type of procurement, (3) obtains independent cost estimates and performs cost or price analyses when required, and (4) prevents and detects conflict-of-interest situations.
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Status2018-NY-1006-001-DOpenClosedClosed on February 12, 2020
We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide training to its staff to ensure compliance with HUD and Federal procurement requirements.
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Status2018-NY-1006-002-AOpenClosed$372,695.00Questioned 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 February 12, 2020We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide documentation to justify the $372,695 in unsupported Operating Fund subsidies received or reimburse its Operating Fund from non-Federal funds for any amount it cannot support.
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Status2018-NY-1006-002-BOpenClosed$8,564.00Questioned 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 February 12, 2020We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide documentation to justify $8,564 in excessive property management fees charged by the COCC or reimburse its Operating Fund from non-Federal funds for any amount it cannot support.
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Status2018-NY-1006-002-COpenClosed$82,907.00Questioned 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 February 12, 2020We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to reimburse its Operating Fund from non-Federal funds $82,907 for 16 document management services contract payments that should have been paid with COCC funds.
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Status2018-NY-1006-002-DOpenClosedClosed on March 26, 2020
We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to strengthen its controls to ensure that operating funds are requested, received, and used in accordance with HUD, Federal, and Authority requirements.
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Status2018-NY-1006-002-EOpenClosedClosed on March 26, 2020
We recommend that the Acting Director of HUD’s Buffalo Office of Public Housing require the Authority to provide training to employees involved in the funding and expenditure processes to ensure compliance with HUD, Federal, and Authority requirements
General Counsel
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Status2018-NY-1006-001-EOpenClosedClosed on August 19, 2019
We also recommend that the Director of HUD’s Departmental Enforcement Center evaluate the apparent conflict-of-interest situations in this report and pursue administrative sanctions if warranted.