On September 15, HUD sent out an email reminding recipients of HUD funds that FY 2009 grant funds are expiring at the end of this month. Grantees must submit drawdown approvals for these funds by September 16, 2016. The email also notes that “[f]or other funds not approaching expiration, grantees can continue to enter draw down requests to September 28th and the draw will be processed before HUD’s accounting system closes. If a disbursement is received by the Line of Credit Control System (LOCCS) (directly, or via IDIS or DRGR) after September 28th, the request will not be processed until HUD’s accounting system is reopened. HUD’s accounting system is expected to reopen in early October.”
This week HUD’s Office of Inspector General (OIG) released a report that found HUD did not always accurately verify Operating Fund calculations. Although the report found HUD did not always verify the calculation of Operating Fund subsidies, it did note that HUD recaptured the funds once it determined that excess subsidies were provided to PHAs. According to the OIG, more than $12 million in operating funds disbursed to PHAs was not adequately supported, and $116,218 was ineligible.
The report recommends that HUD officials:
- determine whether any of the overpayment of $3.6 million was ineligible and recover the ineligible payments;
- recapture from PHAs the $116,218 ineligibly disbursed for the units that exceeded the limit;
- obtain documentation of the utility expense level amounts and verify the accuracy of the computation of $9 million of Operating Fund subsidies and recapture ineligible amounts;
- enhance controls to ensure that verification procedures for Operating Fund calculations are followed by field office staff;
- continue implementing the reconciliation software application to provide greater assurance that operating fund subsidies are accurately calculated based on correct data, and;
- strengthen controls over record keeping.