We audited the Lubbock Housing Authority’s Public Housing Capital Fund program as part of our regional audit plan.  Our objective was to determine whether the Authority properly implemented its U.S. Department of Housing and Urban Development (HUD) Capital Fund program.

The Authority generally implemented its Capital Fund program in compliance with HUD requirements and undertook work consistent with its annual and 5-year plans.  However, it could improve the management of its Capital Fund operations.  While the Authority’s records provided general support for its procurements, its files contained deficiencies.  In addition, the Authority did not have adequate competition for many of its procurements, and its contractors did not always pay the required minimum Davis-Bacon Act wages.  Further, the Authority improperly used capital funds instead of insurance proceeds to replace two roofs, and it did not appropriately hold tenants accountable for their damage.  These conditions existed because the Authority had significant turnover of procurement managers during the scope under review, causing inconsistency in its operations, and it did not fully understand or apply procurement requirements.  As a result, it could not always fully support that it entered into fair and reasonable contracts, and it could not assure HUD that it operated its program effectively and efficiently.

We recommended that the Director of HUD’s Fort Worth Office of Public Housing require the Authority to implement stronger controls to ensure consistency in its Capital Fund program and increase competition for its procurements, resolve $38,232 in questioned costs, and hold its tenants accountable for damages they cause to units.