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HUD-OIG audited the Housing Authority of the City of Colorado Springs, Colorado in response to an anonymous complaint alleging that it improperly awarded all contracts for rehabilitation services to the same bidder, did not properly maintain its waiting list, and inappropriately awarded new Section 8 housing choice vouchers.

Our audit objectives were to determine whether the Authority followed federal procurement requirements and its own procurement policies in awarding two capital fund rehabilitation contracts, properly administered all work done by its contractor, and followed federal occupancy requirements and its own administrative plan in maintaining its Section 8 waiting list and selecting eligible applicants from its waiting list.

The Authority did not follow applicable requirements while awarding and administering two capital fund rehabilitation contracts. It also violated applicable requirements while maintaining its Section 8 waiting list and selecting participants from the waiting list. Specifically, the Authority had no assurance that it received the best price when awarding two contracts that eventually paid out more than $2.2 million. In addition, it did not administer the contracts according to requirements when it paid more than $570,000 to a contractor for services provided outside the scope of the statement of work on the contracts. Lastly, the Authority improperly maintained its waiting list and selected tenants without regard to the waiting list or appropriate support.

Based on the results of our audit, we recommend that the Denver Office of Public Housing require the Authority to provide training, and implement controls to ensure written procedures are followed. In addition, we recommend that the Denver Office of Public Housing perform a post-monitoring review to ensure the Authority took recommended actions.