We audited the Housing Authority of the City of Comer’s financial and procurement operations. We selected the Authority based on concerns from the U.S. Department of Housing and Urban Development’s (HUD) Georgia State Office of Public Housing regarding significant deficiencies identified during its August 2013 management review. HUD’s Office of Public Housing identified findings regarding the misuse of funds, a lack of governance and internal controls, excessive unit vacancies, and a conflict of interest by the executive director.
The Authority did not properly manage its financial operations and procurement activities in accordance with HUD requirements. Specifically, it paid more than $22,000 that violated conflict-of-interest provisions and also prevented it from renovating its vacant units in a timely manner. During the period 2006 to 2014, 10 units were taken offline for renovations, and only two had been completed. One unit had been offline since 2006. In addition, the Authority could not support that it complied with its procurement policies for more than $33,000 in contracts for professional services and general labor. These conditions occurred because the board of commissioners and the executive director failed to follow the provisions of the Authority’s consolidated annual contributions contract and Federal regulations.
We recommend that HUD’s Office of Public Housing require the Authority to (1) reimburse $22,178 in ineligible costs from non-Federal funds; (2) hire qualified contractors to complete the work necessary to make the vacant units habitable and available to low-income families; (3) support or reimburse $33,144 from non-Federal funds; and (4) ensure that its board of commissioners is able to enforce the regulations related to the Authority’s financial operations, conflict-of-interest relationships, and procurement. We also recommend that HUD’s Departmental Enforcement Center, in coordination with the HUD’s Office of Public Housing, take appropriate enforcement actions against the Authority officials responsible for the noncompliance.