Update its procedures to ensure that any additional home-buyer assistance agreements contain recapture provisions that meet HUD recapture requirements relating to the sales price, closing costs, and net proceeds.

Train its staff to ensure that recapture amounts do not exceed net sales proceeds.

Revise and implement written policies and procedures for managing and accurately tracking all NSP3 activity to ensure that the $12,275 in identified closing cost refunds and any additional refunds identified in recommendation 2B are not overpaid by recipients.

Identify any additional closing cost refunds for NSP3 properties using the general ledger, DRGR supporting documentation, and the property file and either repay the recipients from non-Federal funds or update its tracking spreadsheet.

Repay $95 from non-Federal funds to the two recipients who paid more than the assistance provided (appendix E).

Repay the program $1,495 for closing cost expenses not incurred from non-Federal funds and remove the expenses from program records if the City incorrectly recorded the refunds as program income.

Reclassify home-buyer assistance expenses and refunds from the City’s NSP3 ARR program to its NSP3 Homebuyer Assistance Program in DRGR and the general ledger.

Consolidate and reconcile all NSP3 home-buyer assistance tracking spreadsheets and the general ledger with HUD’s DRGR to ensure that all information is accurate and up to date.

Develop and implement written policies and procedures to periodically reconcile all NSP3 tracking spreadsheets to ensure that data remain accurate and up to date.

Provide training to all employees responsible for NSP3 to ensure that the City adequately determines repayment amounts and tracks and records NSP3 activities.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to support the $240,010 in unsupported procurement payments or repay its CDBG program from non-Federal funds.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to report $22,872 in program income to HUD and properly use program income.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to correct its HOME matching liability report to include the recalculated amount for 2014 and pay the matching liability of $3,301.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to confirm that it has developed and implemented written procurement procedures to ensure that future contracts and subrecipient agreements address the procurement and required provision issues identified in the report.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to ensure that all program files include required documentation and support.

We recommend that the Director of HUD’s Houston Office of Community Planning and Development require the Department to monitor subrecipients annually as stated in its monitoring policy.

Consider requiring water testing for all FHA-insured properties.

Review the Authority’s non-Sound Families Initiative project-based voucher projects to determine whether it executed the agreement with the owners of new construction projects.

Assist the Authority in obtaining any training needs identified by the review in recommendation 1A.

Require the Authority to submit evidence and its board of directors to certify to the Director of the Seattle Office of Public Housing that it has complied with regulatory requirements for each step of the project-based voucher process for each new project-based voucher project until such time as the Director of the Seattle Office of Public Housing believes the Authority understands and is consistently complying with the requirements.