We audited the City of Bridgeport CT’s HOME Investment Partnerships program based on an Office of Inspector General risk assessment, which ranked the City as the second highest risk HOME grantee in New England. The objective of the audit was to determine whether the City properly committed and disbursed HOME funds in accordance with Federal and U.S. Department of Housing and Urban Development (HUD) rules and regulations.
City officials did not properly administer their HOME program. Specifically, they did not properly commit and disburse HOME funds in accordance with Federal and HUD rules and regulations. They did not ensure that they (1) met the commitment deadline for their community housing development organizations’ (CHDO) funds, (2) properly documented and supported their underwriting of activities, (3) complied with environmental review requirements, (4) disbursed funds in accordance with program requirements, (5) maintained adequate support to ensure tenant eligibility and compliance with HOME rental limits, and (6) supported their administrative fees. These deficiencies occurred because City officials did not establish adequate written underwriting policies and procedures, were not aware of HUD and Federal requirements, and had poor record-keeping practices. Further, the City’s HOME policies and procedures were outdated. As a result, they incurred $422,768 in ineligible costs and more than $3.2 million in unsupported costs, and $741,698 in unspent HOME funds will need to be reallocated to eligible activities.
We recommend that the Director of HUD’s Hartford Office of Community Planning and Development require City officials to (1) repay $422,768 in ineligible costs related to the City’s failure to meet commitment deadlines and complete activities in accordance with the HOME agreement and HOME regulations; (2) support that more than $3.2 million was reasonable and supported, or repay the funds, (3) reallocate $741,698 in unspent funds to ensure they will be put to their intended use; and (4) develop and implement adequate and updated HOME policies and procedures and tools to improve record-keeping practices.
Recommendations
Community Planning and Development
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Status2019-BO-1001-001-AOpenClosed$422,768.00Questioned 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 December 01, 2022Repay from non-Federal funds the $422,768 in ineligible funds related to the City’s failure to meet HOME CHDO commitment deadlines and complete activities in accordance with the HOME agreement and HOME regulations.
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Status2019-BO-1001-001-BOpenClosed$3,136,798.00Questioned 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.
Support that $3,136,798 in HOME funds disbursed was reasonable and supported in accordance with Federal requirements or repay from non-Federal funds any amount that cannot be supported.
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Status2019-BO-1001-001-COpenClosed$130,667.00Questioned 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.
Support that the City properly administered the HOME program and earned $130,667 in HOME administrative fees or repay from non-Federal funds any amount that cannot be supported
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Status2019-BO-1001-001-DOpenClosed$487,483.00Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Reallocate the $487,483 in unspent funds to ensure that they will be put to their intended use or, if the activities remain open, maintain support to show that the HOME funds disbursed were reasonable and Reallocate the $487,483 in unspent funds to ensure that they will be put to their intended use or, if the activities remain open, maintain support to show that the HOME funds disbursed were reasonable and supported in accordance with Federal requirements.
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Status2019-BO-1001-001-EOpenClosed$254,215.00Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Identify, review, and approve a CHDO to work with the City to ensure that $254,215 in CHDO funds will be properly committed to avoid being deobligated.
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Status2019-BO-1001-001-FOpenClosed
Establish underwriting policies and procedures to ensure that HOME activities are consistent and meet Federal requirements.
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Status2019-BO-1001-001-GOpenClosed
Develop and implement adequate environmental policies and procedures to ensure that environmental reviews are properly documented and supported and that HUD and Federal environmental requirements have been followed before committing HOME funds to an activity.
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Status2019-BO-1001-001-HOpenClosed
Develop and implement adequate policies and procedures to ensure that fixed HOME units are identified and adequate documentation is maintained to support tenant eligibility and compliance with HOME rental limits for the entire affordability period.
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Status2019-BO-1001-001-IOpenClosed
Develop and implement tools to improve record-keeping practices to support the eligibility, necessity, and reasonableness of the HOME activities.
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Status2019-BO-1001-001-JOpenClosed
Provide technical assistance to the City to ensure that responsible staff receives necessary environmental, underwriting, and overall program administration training.