Homelessness Prevention and Rapid Re-Housing Program. Our objectives were to determine whether the State ensured that (1) Recovery Act disbursements to local governments were eligible and supported and (2) Program participants were eligible to receive assistance in accordance with Program requirements.

The State generally ensured that its Recovery Act disbursements to local governments were eligible. However, some of the disbursements were not adequately supported. This condition occurred because the State’s review did not always identify issues related to missing documentation when it processed reimbursement requests from its local governments. As a result, the State incurred $10,547 in unsupported costs. Additionally, the State did not always ensure that Program participants’ eligibility to receive Program assistance was adequately supported. Specifically, 20 of 37 Program participant files reviewed lacked required documentation supporting income verification; housing status; and needs, rent reasonableness, and lead-based paint determinations. This condition occurred because the State did not did not ensure that its local governments and subgrantees established adequate control procedures to ensure that they adequately supported their eligibility determinations. As a result, the State paid $31,217 in Program assistance for participants whose eligibility was not adequately documented.

We recommend that the U. S. Department of Housing and Urban Development’s (HUD) Director of Community Planning and Development require the State to (1) support or repay $41,764 in unsupported costs. Since the State’s Recovery Act program ends July 31, 2012, we did not provide a recommendation to address the causes regarding expenditure and eligibility violations.