We audited the Inkster Housing Commission’s public housing and Section 8 programs as part of the activities in our fiscal year 2013 annual audit plan.  We selected the Commission based on a citizen’s complaint to our office and our analysis of risk factors relating to public housing agencies in Region 5’s jurisdiction.  Our objective was to determine whether the Commission administered its programs in accordance with HUD’s and its own requirements.

The Commission did not comply with HUD’s requirements and its own administrative plan regarding the administration of its Section 8 program household files.  Specifically, it did not (1) correctly calculate and process housing assistance payments, (2) maintain required eligibility documentation, and (3) ensure that assisted units were affordable.  As a result of the Commission’s noncompliance, it had more than $174,000 in overpayments, nearly $447,000 in unsupported payments, and nearly $11,000 in underpayments.  In addition, households paid nearly $66,000 for assisted units that were not affordable.  Further, because the household files were missing required eligibility documentation, HUD and the Commission lacked assurance that the households were eligible for the program.

The Commission inappropriately used its Federal funds to pay ineligible expenditures.  As a result, it used more than $27,000 in Federal funds for ineligible expenditures. 

We recommend that the Director of HUD’s Detroit Office of Public Housing require the Commission to (1) pursue repayment or reimburse its program more than $201,000 from non-Federal funds, (2) support or reimburse its program, households or landlords nearly $447,000 from non-Federal funds, (5) reimburse the households nearly $77,000, and (6) implement adequate controls to address the findings cited in this audit report.