We audited the Louisiana Land Trust (LLT), a $29 million Community Development Block Grant (CDBG) disaster recovery subrecipient of the State of Louisiana, Office of Community Development (State). We initiated the audit as part of the Office of Inspector General (OIG) Gulf Coast Region’s audit plan and examination of relief efforts provided by the federal government in the aftermath of Hurricanes Katrina and Rita. Our audit objective was to determine whether LLT, as the State’s subrecipient, properly maintained properties received from the State.
Although LLT ensured that its maintenance contractor generally maintained the lawns of properties, it did not always ensure that the properties were properly maintained overall. Of 67 properties visited, 23 (34 percent) had maintenance deficiencies, mostly related to security and cleanliness, which violated contract requirements. This condition occurred because (1) the State did not clearly convey its expectations to LLT regarding property maintenance, (2) LLT did not ensure that its maintenance contractor complied with the terms of its contract, (3) the contract between LLT and its maintenance contractor did not specifically detail the responsibilities of the maintenance contractor, and (4) LLT’s inspectors did not have written policies and procedures to follow during their inspections. Further, LLT did not take action on some properties, properly coordinate with other entities when making decisions, or document its decisions in its system. As a result, there were services that were not satisfactorily performed, and some properties presented safety risks to the general public, which could potentially cause LLT to incur financial liabilities.
We recommend that HUD’s General Deputy Assistant Secretary for Community Planning and Development require the State to (1) specify its expectations of LLT as related to property maintenance, in its cooperative endeavor agreement; (2) continuously monitor LLT to ensure that its maintenance contractor complies with the terms of its contract; (3) ensure that LLT clearly conveys and documents the maintenance contractor’s expectations; (4) ensure that LLT develops written policies and procedures for its inspectors to follow; (5) correct deficiencies identified at the 23 properties; and (6) ensure that LLT coordinates with the State when making decisions, document decisions made in its system, and create a written policy for prioritizing properties for demolition.