We audited the Virgin Islands Housing Finance Authority’s Non-Federal Match Program for Community Development Block Grant Disaster Recovery (CDBG-DR) funds. This Match Program was developed to assist non-Federal entities in paying for their share of projects that addressed unmet needs because of the 2017 Hurricanes Irma and Maria. We initiated this audit due to the $415 million of CDBG-DR funds allocated by the Authority and to support the U.S. Department of Housing and Urban Development’s (HUD) strategic objective of promoting effectiveness and accountability in long-term disaster recovery.
Our audit objective was to determine whether the Authority effectively administered its Match Program by identifying and assessing any challenges that hindered its ability to achieve program goals.
We determined that the Authority’s administration of its Match Program had weaknesses. Specifically, the Authority had (1) insufficient financial controls, (2) insufficient oversight of its Match Program-funded projects, (3) inaccurate performance measures reported in its quarterly performance reports, and (4) insufficient documentation to support its national objectives. This condition occurred because the Authority did not have adequate policies and procedures or did not implement its existing policies to ensure effective administration of its Match Program. As a result, the Authority was at risk of not managing its Match Program in compliance with HUD requirements and achieving program goals. Further, this condition could result in the Authority providing program benefits to the intended beneficiaries late and increasing the risk of the Authority issuing improper payments.
We recommend that the Deputy Assistant Secretary for Grant Programs require the Authority to (1) develop and implement policies and procedures to address the challenges identified and (2) conduct training for its staff and CDBG-DR Match Program recipients.
Recommendations
Community Planning and Development
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Status2023-FW-1002-001-AOpenClosedClosed on July 30, 2024
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to develop and implement procedures, including financial controls, to enhance its tracking of payments made with CDBG-DR funds and payments made with FEMA funds to ensure that payments are not made for the same invoices, match requirements are not exceeded before closeout, and a thorough review is conducted for award increases and cost reasonableness.
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Status2023-FW-1002-001-BOpenClosedClosed on October 20, 2023
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to enforce its subrecipient agreement requirement to submit monthly status reports.
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Status2023-FW-1002-001-COpenClosedClosed on July 30, 2024
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to develop and implement procedures to ensure that all Match Program activities are monitored, and guidance is provided to its Match Program recipients.
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Status2023-FW-1002-001-DOpenClosedClosed on October 20, 2023
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to develop and implement detailed policies and procedures to guide staff in reporting performance outcomes in the QPR and on its disaster recovery website.
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Status2023-FW-1002-001-EOpenClosedClosed on July 30, 2024
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to revise its policies and procedures to include requirements to document its basis for activities’ meeting the national objective, including the rationale for the service area used and a list of acceptable documents to support that the area was primarily residential for the low- and moderate- income area benefit national objective.
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Status2023-FW-1002-001-FOpenClosedClosed on July 30, 2024
We recommend that the Deputy Assistant Secretary instruct the Virgin Islands Housing Finance Authority to conduct training for Authority staff on the newly developed or revised policies and procedures
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Status2023-FW-1002-001-GOpenClosed
We recommend that the Deputy Assistant Secretary work with the Authority to assess the risk of potential improper payment for projects PW273 and PW100 and vouchers 576322, 583423, and 578761.
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Status2023-FW-1002-001-HOpenClosedClosed on July 30, 2024
We recommend that the Deputy Assistant Secretary require HUD program staff to provide technical assistance to the Authority to address deficiencies noted throughout the audit report.