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The Jefferson Parish, LA Department of Community Development Did Not Always Support Expenditures, Comply With Procurement Requirements, or Provide Adequate Oversight of Subrecipients

We audited the Jefferson Parish’s Community Development Block Grant (CDBG) program as part of the Office of Inspector General’s annual audit plan to review Community Development funds.  The audit objective was to determine whether the Parish adequately supported and expended its program funds in accordance with Federal requirements.

We found that the Parish did not always (1) have documentation to support program expenditures, (2) comply with procurement requirements when procuring contractors for housing rehabilitation, and (3) provide adequate oversight for its subrecipients.  These conditions occurred because the Parish (1) did not have updated written departmental procedures for its staff, adequate staffing levels, an efficient records management system, or complete written departmental procurement procedures; (2) relied on its subrecipient to maintain documentation to support its project without verifying the adequacy of the documentation; (3) did not ensure that staff was aware of the departmental monitoring policy; and (4) disregarded monitoring and agreement requirements.  As a result, the Parish could not support that more than $1.4 million of program costs were eligible, reasonable, or met a national objective.  In addition, it increased the risk of fraud, waste, and abuse.

We recommend that the Director of HUD’s New Orleans Office of Community Planning and Development require the Parish to (1) support or repay its CDBG program $1.4 million from non-Federal funds, (2) implement written departmental expenditure, procurement, and monitoring procedures, (3) implement a departmental records management system for expenditures and national objective compliance, and (4) implement a departmental process to maintain and update the Parish’s pre-qualified bidder’s list.