We reviewed the County of Santa Barbara’s HOME Investment Partnerships program due to concerns expressed by the U.S. Department of Housing and Urban Development’s (HUD) Los Angeles Office of Community Planning and Development regarding the County’s administration of its HOME program. Our objective was to determine whether the County performed its monitoring responsibilities and ensured that incurred HOME program expenditures were eligible and supported.
The County demonstrated that expenditures totaling more than $3.9 million related to rental housing project costs were eligible and adequately supported. However, it incurred more than $3.5 million in unsupported and ineligible HOME costs. In addition, it did not perform the required monitoring of its Community Housing Development Organizations (CHDOs) or conduct required onsite inspections of its HOME-funded rental housing properties.
We recommend that the Director of the HUD Los Angeles Office of Community Planning and Development require the County to (1) support more than $3.1 million in expenses or repay the program; (2) repay $444,499 in ineligible expenses from non-Federal sources; and (3) update and implement its written monitoring, recordkeeping, and payment processing policies and procedures as well as controls to ensure compliance with required HOME program rules and requirements.