HUD OIG performed an audit of the City of Augusta's Community Development Block Grant Facade Rehabilitation Grant program due to concerns of mismanagement and abuse regarding the City's program. The purpose of the audit was to determine whether the City's facade program complied with federal requirements and whether program activities met the national objectives of the CDBG program
The City did not have adequate controls over its financial management of the facade program. A review of the City's program drawdown reports showed payments totaling $180,817 that were not recorded in the general ledgers. In addition, HUD could not be assured that the remaining $270,175 in program funds would be accurately recorded or expended in a timely manner. The City did not adequately monitor its facade program. It did not verify the program match requirements or complete facade grants in a timely manner. In addition, it did not ensure that program files were complete and contained all information required by its policies and procedures.
OIG recommended that the Director of HUD's Atlanta Office of Community Planning and Development require the City to (1) properly support or repay the facade program $180,817 from non-federal funds and establish controls to ensure that all program transactions are accurately recorded in the general ledgers and (2) establish controls to ensure that the remaining $270,175 in program funds is used for its intended purpose or reprogrammed to fund other eligible CDBG activities. OIG also recommend that the Director ensure that the City establishes controls to ensure that staff follows written policies and procedures for administering the facade program.