The U. S. Department of Housing and Urban Development Office of Inspector General audited the City of Thornton (City) to determine whether it used its Community Development Block Grant (CDBG) funds for projects that met a national objective.

The City did not maintain sufficient records demonstrating that each CDBG activity met a national objective. Of the 10 CDBG projects reviewed, the City sufficiently documented that five of the projects met a national objective. However, for four projects that the City certified met the national objective based on area benefit, it did not identify the specific area to be benefited by the activity, it did not document that at least 51 percent of the residents in the area were low- and moderate-income persons, and it did not document that the area was primarily residential. For the remaining project, it did not certify what national objective the project would meet and did not document that a national objective was ultimately met.

We recommend that HUD require the City to provide documentation supporting that the five CDBG projects met a national objective. We also recommend that HUD require the City to establish and implement effective policies and procedures to ensure that it maintains adequate documentation to support compliance with the CDBG national objective requirements.