We audited the Gallia Metropolitan Housing Authority’s American Recovery and Reinvestment Act of 2009 Public Housing Capital Fund Stimulus (formula) grant. The audit was part of the activities in our fiscal year 2011 annual audit plan. We selected the Authority based upon our analysis of risk factors relating to the housing agencies in Region V’s (see footnote 1) jurisdiction and a request by the U.S. Department of Housing and Urban Development’s (HUD) Office of Public and Indian Housing. Our objective was to determine whether the Authority administered its grant in accordance with Recovery Act, HUD’s, and its requirements.
The Authority did not administer its grant in accordance with Recovery Act, HUD’s, and its requirements. Specifically, it (1) incorrectly stated in its solicitations for appliances both the make and model number of the appliances required instead of providing only a general description, (2) did not award a contract for 5 ranges to the lowest bidder, (3) purchased 143 ranges and 142 refrigerators when its plan stated that it would purchase 140 of each, (4) replaced 13 refrigerators and 10 ranges that still had useful life, and (5) did not accurately report in FederalReporting.gov the number of jobs created and retained. The problems occurred because the Authority lacked adequate procedures and controls regarding the administration of its grant funds to ensure that expenditures and grant reporting met Recovery Act, HUD, and its requirements. As a result, it improperly used $11,397 in formula grant funds contrary to program requirements, and its reporting of Recovery Act-funded activities on FederalReporting.gov was inaccurate.
We recommend that the Director of HUD’s Cleveland Office of Public Housing require the Authority to (1) reimburse $11,397 from non-Federal funds to HUD for transmission to the U.S. Treasury for the inappropriate use of the funds cited in finding 1 and (2) implement adequate procedures to ensure that its procurement policies are followed.