We audited the City of Rocky Mount, NC’s HOME Investment Partnerships program based on a request from the U.S. Department of Housing and Urban Development’s (HUD) Greensboro, NC, Office of Community Planning and Development.  The request expressed several concerns regarding the City’s administration of its HOME program.  Our objective was to determine whether HUD’s concerns had merit and whether the City operated its HOME program in accordance with requirements.

The City did not properly manage its HOME program.  It failed to properly monitor its subrecipient, properly manage its community housing development organization contract, retain some program documents, and keep the Integrated Disbursement and Information System up to date.  These conditions occurred due to internal control weaknesses such as high employee turnover and extended vacancies in key positions.  As a result, the City expended $9,309 for ineligible expenses, could not demonstrate that it used $313,286 for eligible expenses, and failed to keep HUD informed regarding the status of its program.

We recommend that HUD’s Greensboro Office of Community Planning and Development require that the City provide assurance that it has put into place an acceptable internal control structure for providing appropriate administration and oversight of its HOME program activities, including appropriate staffing and the required retention of program documents.  We further recommend that HUD require the City to repay $9,309 in ineligible expenses and support that it spent $313,286 on eligible activities.