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We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of Private Enforcement Initiative grants awarded under its Fair Housing Initiatives program as part of our annual audit plan. Our objective was to determine whether HUD performed monitoring to ensure that enforcement grant funds were spent in compliance with grant terms and program requirements.

HUD monitoring generally covered procedures required to ensure that grantees complied with grant terms and program requirements. However, HUD did not perform onsite monitoring as required for approximately $10.2 million of about $40.9 million in enforcement grants awarded during the audit period and did not always report monitoring results in a timely manner. These deficiencies occurred because program technical monitors and representatives did not perform their monitoring responsibilities in accordance with HUD policy. Also HUD did not have a system or process in place to ensure that monitoring and related reporting were consistently completed as required. As a result, there was no assurance that program requirements were fully met for grants that were not properly monitored.

We recommended that the Deputy Assistant Secretary for Enforcement and Programs (1) issue a directive emphasizing the importance of onsite monitoring to applicable staff, and (2) develop and implement a tracking process to ensure that grantee monitoring and related reporting are completed in accordance with HUD policies.