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Report Fraud, Waste and Abuse
January 29, 2010
2010-AT-1008
ig1041008.pdf

We conducted this audit because the County was one of several participating jurisdictions visited during a 2009 internal audit of HOME commitments (audit report number 2009-AT-0001, issued September 28, 2009). During the internal audit, we determined that the County entered incorrect commitments into HUD’s information system. Our objective for this audit was to determine the extent of the incorrect HOME commitments that the County entered into the information system and the impact of the incorrect entries, including those identified during the internal audit.

The audit identified more than $1.6 million in incorrect commitment entries that the County made to HUD’s information system. The incorrect entries masked a shortfall of more than $400,000 that is subject to recapture by HUD. The incorrect commitments occurred because County staff did not follow and enforce HUD program requirements or implement adequate controls to monitor the accuracy of HOME commitments.

In addition, the County improperly executed agreements for its HOME-funded tenant-based rental assistance activities that obligated Section 8 funds to pay the costs, although the County used HOME funds to make the assistance payments. The Section 8 contracts did not legally support the commitment of HOME funds. This condition occurred because County management failed to ensure that the contracts were properly drafted to commit HOME funds for its tenant-based rental assistance program.

We recommend that the Director of HUD’s Jacksonville Office of Community Planning and Development (1) recapture $400,776 in HOME funds not committed by the County’s October 31, 2008, deadline compliance date, (2) require the County to implement controls to ensure that future HOME funds are committed by the required deadline, monitor commitments entered into HUD’s information system, and take appropriate action to promptly correct detected violations, and (3) require the County to prepare a proper legal contract template for its HOME-funded tenant-based rental assistance activities and use that contract template for all future HOME funds committed to those activities.