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.