Oregon Housing and Community Services Allowed a Developer To Use Neighborhood Stabilization Program Funds for Ineligible Purposes | Office of Inspector General, Department of Housing and Urban Development

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February 28, 2011

Community Planning and Development

2011-SE-1003

ig1101003.pdf

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited Oregon Housing and Community Services to determine whether it timely obligated Neighborhood Stabilization Program (NSP) funds, adequately monitored subgrantee and contractor performance, properly maintained NSP records, and reasonably assured NSP funds were spent for eligible activities. We selected OHCS because it received $19.6 million in NSP funds.

Oregon Housing generally complied with program requirements. However, it did allow one developer to use $5,000 of program funds for ineligible operating and replacement reserves. We recommended that Oregon Housing repay or reallocate the $5,000, ensure its subrecipients and developers understand program requirements regarding reserves, and check for and correct similar problems in other projects.