We audited Community Action North Bay’s Continuum of Care Program based on hotline complaints (HC-2016-2275 and HT-2019-1142) and concerns expressed by the San Francisco Office of Community Planning and Development that included matching noncompliance issues. The complaints alleged improper accounting, timekeeping irregularities, unreported program income, and conflicts of interest. Our objective was to determine whether the Community administered its Continuum of Care Program in accordance with U.S. Department of Housing and Urban Development (HUD) requirements.
The complaints and concerns had merit. The Community did not administer its Continuum of Care Program in accordance with HUD requirements. Specifically, it did not maintain documents required to support that (1) it met the matching contribution requirement, (2) its rapid rehousing and permanent supportive housing programs assisted eligible individuals, and (3) program income and expenses were supported and eligible. These conditions occurred because the Community did not implement corrective actions recommended by HUD and its staff lacked the knowledge and skills needed to administer the program. As a result, the Community is at risk of having to repay HUD grant funds totaling $647,827 if it cannot provide supporting documentation related to required matching contributions. It also could not support the eligibility of individuals assisted by its rapid rehousing and permanent supportive housing programs.
We recommend that the Director of HUD’s San Francisco Office of Community Planning and Development require the Community to (1) support that it met the matching contribution requirement or reimburse HUD $577,670 from non-Federal funds, (2) reclassify $28,576 as program income to the specific permanent supportive housing program, and (3) support that $2,687 paid to a board member for legal services was allowed through a HUD-approved waiver or repay HUD from non-Federal funds.
Recommendations
Community Planning and Development
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Status2020-LA-1001-001-AOpenClosed$577,670.00Questioned 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 May 05, 2021Support that it met its $161,957 matching contribution required for the $647,827 it drew down for expenses related to its four HUD-funded programs. If the Community cannot provide support, it should reimburse HUD $577,6707 from non-Federal funds.
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Status2020-LA-1001-001-BOpenClosedClosed on October 21, 2021
Develop and implement written policies and procedures to ensure that it maintains documentation to support matching contributions received in compliance with HUD requirements.
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Status2020-LA-1001-001-COpenClosed$15,163.00Questioned 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 July 17, 2020Repay HUD $15,163 from non-Federal funds for the rental assistance provided to five ineligible individuals.
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Status2020-LA-1001-001-DOpenClosed$26,676.00Questioned 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 August 17, 2021Support the eligibility of the 11 individuals who received rental assistance through its rapid rehousing program or repay HUD $26,676 from non-Federal funds.
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Status2020-LA-1001-001-EOpenClosed$5,493.00Questioned 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 November 10, 2021Work with HUD to determine the eligibility of current permanent supportive housing residents and if residents are determined ineligible, take appropriate action.
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Status2020-LA-1001-001-FOpenClosedClosed on November 01, 2021
Implement its written policies and procedures to ensure that only eligible individuals receive rapid rehousing assistance.
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Status2020-LA-1001-001-GOpenClosedClosed on July 30, 2021
Implement its written policies and procedures to ensure that individuals entering its permanent supportive housing are eligible.
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Status2020-LA-1001-001-HOpenClosed$17,025.00Questioned 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 March 25, 2021Support or repay HUD $17,025 from non-Federal funds for the questioned payroll costs charged to the programs.
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Status2020-LA-1001-001-IOpenClosedClosed on July 30, 2021
Develop and implement written policies and procedures to ensure accurate and complete reporting of staff hours charged to each program.
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Status2020-LA-1001-001-JOpenClosed$8,605.00Questioned 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 March 25, 2021Support the validity of its indirect cost allocations or repay HUD $8,605 from non-Federal funds.
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Status2020-LA-1001-001-KOpenClosedClosed on August 04, 2021
Develop and implement an indirect cost allocation plan, which ensures that indirect costs are charged to the correct program.
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Status2020-LA-1001-001-LOpenClosedClosed on December 21, 2020
Provide technical assistance to the Community to ensure that its staff receives training on documentation of matching contributions and the use of program funds.
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Status2020-LA-1001-002-AOpenClosed$28,576.00Funds 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.
Closed on October 20, 2020Reclassify the $28,576 as program income to the specific permanent supportive housing program that generated it and ensure these funds are used for that specific program.
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Status2020-LA-1001-002-BOpenClosedClosed on August 04, 2021
Develop and implement written policies and procedures to ensure that all program income is recorded and used in accordance with HUD requirements.
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Status2020-LA-1001-003-AOpenClosed$2,687.00Questioned 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 July 17, 2020Support that $2,687 in payments to the board member for legal services was allowed through a HUD-approved waiver that occurred before the legal services or repay HUD from non-Federal funds.