OFFICE OF INSPECTOR GENERAL

U.S. Department of Housing and Urban Development

SEMIANNUAL REPORT 

TO CONGRESS

For the period April 1, 2021, to September 30, 2021

OFFICE

INSPECTOR GENERAL

UNITED STATES DEPARTMENT OF

HOUSING AND URBAN DEVELOPMENT 

o f 
TABLE OF CONTENTS

PROFILE OF PERFORMANCE .....................................................................................................................................3

A MESSAGE FROM THE INSPECTOR GENERAL..................................................................................................4

SNAPSHOT.........................................................................................................................................................................6

Spotlight..........................................................................................................................................................................6

Making an Impact........................................................................................................................................................9

PROGRAM AREAS........................................................................................................................................................ 10

Housing......................................................................................................................................................................... 10

Public and Indian Housing..................................................................................................................................... 14

Community Planning and Development ......................................................................................................... 17

ADDITIONAL REPORTS............................................................................................................................................. 20

Other Significant Audits and Evaluations......................................................................................................... 20

Legislation, Regulations, and Other Directives............................................................................................... 23

Report Resolution ..................................................................................................................................................... 32

Whistleblower Protection Coordinator ............................................................................................................. 51

Peer Review Reporting............................................................................................................................................ 49

APPENDIXES.................................................................................................................................................................. 53

Appendix 1 – Reports Issued................................................................................................................................. 53

Appendix 2 – Tables.................................................................................................................................................. 56

Appendix 3 – Inspector General Empowerment Act ................................................................................... 88

Appendix 4 – Reporting Requirements............................................................................................................. 94

Appendix 5 – Acronyms and Abbreviations.................................................................................................... 96

Appendix 6 – OIG Telephone Directory............................................................................................................. 98
PROFILE OF

3 PROFILE OF PERFORMANCE I HUD OIG Semiannual Report to Congress

PERFORMANCE

For the period April 1, 2021, to 

September 30, 2021

AUDIT RESULTS This Reporting Period Fiscal Year 2021

Recommendations that funds be put to better use $9,760,886 $448,452,193

Recommended questioned costs $1,767,427 $14,632,094

Collections from audits $37,520,915 $127,722,597

Administrative sanctions 0 0

Civil actions 0 1

Subpoenas 0 2

Personnel actions 0 0

INVESTIGATIVE RESULTS

Total restitutions and judgments $17,810,809 $57,898,921

Total recoveries and receivables to HUD programs $6,636,890 $25,182,931

Arrests 61 112

Indictments and informations 73 149

Convictions, pleas, and pretrial diversions 57 122

Civil actions 6 30

Total administrative sanctions 20 69

Suspensions 2 2

Debarments 1 14

Program or professional license/certification 9 39

Evictions 5 8

Other1 3 6

Systemic implication reports 0 0

Search warrants 19 31

Subpoenas 203 411

1

Includes employee actions (reprimands, suspensions, demotions, or terminations of the employees of Federal, State, or local governments or of Federal contractors and grantees as the result of OIG 

activities) and limited denial of participation. 
A MESSAGE FROM

THE INSPECTOR GENERAL

4 A MESSAGE FROM THE INSPECTOR GENERAL I HUD OIG Semiannual Report to Congress

I am proud to submit the U.S. Department of 

Housing and Urban Development (HUD), Office 

of Inspector General’s (OIG) Semiannual Report 

to Congress, which covers the period April 1 – 

September 30, 2021. 

As I complete my third year as Inspector General, I am more impressed than 

ever by the oversight we do here at HUD OIG and by the dedication of our 

cross-cutting team of engaged professionals. Together, we have developed 

and implemented collaborative processes to help us focus on performing 

timely and quality oversight that improves HUD’s program delivery. Our 

team works closely to support HUD’s core mission, and together with 

our colleagues at HUD, our goal is to make HUD’s programs and the 

administration of those programs the strongest and most efficient that they 

can be. 

We strive to make a difference and ensure that our work has maximum 

positive impact. There are so many people who need us to get this right 

because safe, affordable, clean housing, available to all eligible individuals, 

is critical. As we engage in strategic planning for the next 4 years, we are 

committed to protecting the interests of our stakeholders – HUD, Congress, 

and the public. 

I am also a member of the Pandemic Response Accountability Committee, 

with whom my office collaborates to protect pandemic relief funds 

governmentwide. Given the influx of Coronavirus Aid, Relief, and Economic 

Security (CARES) Act and American Rescue Plan Act (ARP) funds intended 

to assist individuals impacted by the pandemic in a timely manner, our 

oversight is imperative. 

I want to take this opportunity to welcome the new leadership team at 

HUD, under the direction of Secretary Marcia L. Fudge, and recognize HUD’s 

career public servants, who work hard each day to efficiently administer 

HUD’s programs and deliver critical housing to those in need. With an annual 

budget of nearly $50 billion – plus more than $10 billion in ARP funds in 2021, 

more than $12 billion in CARES Act funds from 2020, and almost $39 billion in 

disaster recovery funds from prior years to be spent – we understand that the 

challenges of administering these funds are significant. As we conduct our 

oversight, we strive to recognize the progress that has been made by HUD as 

well as the challenges that are ahead, particularly with the influx of pandemic 

relief funds. 

Internally, we collaborate to develop ideas for how we can maximize our 

impact and do what we were created to do: perform timely impactful 

oversight to help HUD meet its critical mission of providing housing 

assistance to those in need. This includes identifying instances of fraud, 

waste, abuse, and mismanagement and providing recommendations that 

help HUD, its grantees, and subgrantees get assistance out as quickly as 

possible to address housing needs when they arise. It also includes ensuring 

proper stewardship of HUD funds and keeping them out of the hands of 

the fraudsters who seek to divert these funds for other purposes. We have 

invested in growing our Office of Information Technology to enhance our use 

of data, incorporating it throughout every component of our organization, so 

that we can make risk-based decisions for all of our oversight. We have also 

incorporated agile work into our portfolio to provide timely information to 

HUD and our stakeholders. 

Toward these ends, our audit and evaluation teams have focused on areas we 

have identified as priorities, such as ensuring that housing is habitable and 
5 A MESSAGE FROM THE INSPECTOR GENERAL I HUD OIG Semiannual Report to Congress

hazard free; promoting integrity and efficiency in HUD operations; improving 

accountability and effectiveness in disaster response and recovery; managing 

risk in grant programs; and identifying, preventing, and investigating 

fraud against HUD programs. For example, during this reporting period, 

we conducted an evaluation and recommended the issuance of a 

departmentwide policy aimed at protecting residents in HUD-assisted 

housing from the hazardous health effects of radon exposure. We also 

conducted an audit focused on the underutilization of HUD’s Housing Choice 

Voucher Program, making recommendations to help HUD maximize the 

number of eligible families who benefit from that program. This is especially 

important now that ARP has provided an additional $5 billion to HUD to 

fund 70,000 more vouchers for individuals and families who are experiencing 

homelessness or are at risk of homelessness. 

We have looked at challenges in administering disaster relief programs, which 

need to get funds out promptly to those impacted by emergencies. During 

this semiannual period, we issued two audit reports focusing on the untimely 

administration of disaster recovery funds related to Hurricane Harvey, both 

identifying concerns related to compliance with procurement controls, the 

maintenance of adequate documentation, and subrecipient oversight. As we 

have done previously, we continue to recommend that HUD’s Community 

Development Block Grant Disaster and Mitigation programs be codified, 

which we believe is critical in helping HUD to administer disaster relief funds 

in a timely manner moving forward. 

We also continue to perform work to help HUD address its top management 

challenges, to include ongoing staffing challenges at HUD, which impact the 

efficient operations of all of its programs. During this semiannual period, we 

conducted an evaluation of HUD’s hiring process, identifying challenges and 

impediments to bringing qualified individuals on board in a timely manner. 

HUD accepted all 11 recommendations and is in the process implementing 

process improvement plans. 

We take an agencywide approach to preventing and pursuing fraud. The 

efforts of our Office of Investigation have resulted in several indictments and 

convictions related to fraud across multiple HUD programs. For example, 

during this semiannual period alone, a former executive director of a public 

housing agency pleaded guilty to embezzling more than $500,000; a former 

manager of three housing complexes catering to elderly and disabled citizens 

pleaded guilty to diverting more than $400,000 for personal expenses; and 

a former administrator and owner of an Alzheimer’s assisted living facility 

was sentenced to almost 4 years in prison and ordered to pay $2 million in 

restitution for equity skimming for taking money from his business to pay 

for personal expenses, rather than using it to repay a HUD-insured loan, 

as mandated. Our cases have also resulted in civil settlements involving 

allegations of false claims, to include a duplicate billing scheme by an 

individual who charged HUD and a local funding program for the same 

expenses, and a landlord who improperly used HUD funding for a relative’s 

housing for 10 years and provided associated false certifications to HUD. 

Beyond investigations, our audit team is conducting substantial work related 

to identifying risks and improper payments, making recommendations to 

protect HUD’s programs. 

In closing, I would like to thank Congress for its continued support of our 

oversight efforts, which is so important to our ability to be impactful, as well 

as the many community stakeholders who partner with us to protect HUD’s 

programs and help ensure that eligible individuals have safe and affordable 

housing without hazards. In addition, I want to recognize the commitment of 

our entire HUD OIG team, who work above and beyond to protect taxpayer 

funds and the individuals who need HUD’s assistance in meeting their critical 

housing needs. I am honored to lead this team, to enhance our oversight 

capabilities and maximize impact, and to continue to help effect positive 

change for HUD programs and those served by them. 

Inspector General 

Rae Oliver Davis
SNAPSHOT

Spotlight

Our fiscal year 2021 performance has helped us deliver for the U.S. 

Department of Housing and Urban Development (HUD), Congress, and our 

other stakeholders, including HUD communities nationwide. Our work has 

helped the Department achieve its mission to create strong, sustainable, 

inclusive communities and quality, affordable homes for all. Our scale, 

reach, and activities range from efforts to identify and mitigate health 

risks to residents living in HUD-funded properties to providing oversight of 

relief efforts provided by the Coronavirus Aid, Relief, and Economic Security 

Act (CARES Act), as well as providing oversight to more than 300 of HUD’s 

programs and operations. This section draws attention to our reports and 

performance since April 1, 2021.

HUD Remains Challenged To Serve the Maximum Number of 

Eligible Families Due to Decreasing Utilization in the Housing 

Choice Voucher Program

HUD’s Office of Inspector General (OIG) audited HUD’s oversight of voucher 

utilization and reallocation in the Housing Choice Voucher Program based 

on the OIG report on HUD’s top management challenges for fiscal year 

2020 and HUD’s strategic goals and objectives reported in its 2018-2022 

strategic plan. 

In addition, while responding to a congressional inquiry from Senator 

Chuck Grassley’s office, regarding portability in the Program (audit report 

number 2020-CH-0006, issued September 9, 2020), OIG identified that as 

of September 2019, HUD had more than 300,000 unused vouchers that 

could potentially be used to house families in need of affordable housing. 

The audit objective was to assess HUD’s oversight of voucher utilization 

and reallocation in the Housing Choice Voucher Program. HUD remains 

challenged to ensure that the maximum number of eligible families 

benefits from its Housing Choice Voucher Program. 

Specifically, while HUD’s voucher utilization rate had decreased, it 

estimated that as of November 2020, more than 62 percent of public 

housing agencies in the Program had leasing potential and that leasing 

potential could increase in 2021.

In addition, HUD had not exercised its regulatory authority to reallocate 

housing choice vouchers and associated funding when public housing 

agencies underutilized their vouchers. HUD remains challenged with 

voucher utilization because some public housing agencies continue to 

encounter difficulties that are not within their control to overcome and 

which negatively impact the agencies’ ability to increase leasing in their 

service areas. In addition, HUD believed that it could not implement its 

reallocation regulation because of legislative changes dating back to 

2003. As a result, nearly 81,000 available housing choice vouchers could 

potentially be used to provide additional subsidized housing for eligible 

families. Further, more than 191,000 authorized vouchers were unused 

and unfunded, meaning that more than 191,000 additional low- to 

moderate-income families could possibly benefit from subsidized housing 

by using these vouchers. However, HUD would need an additional 

appropriation of nearly $1.8 billion to fund these vouchers.

OIG recommended that HUD’s Office of Field Operations establish and 

implement a plan to assist public housing agencies in optimizing leasing 

6 SNAPSHOT I HUD OIG Semiannual Report to Congress
potential to maximize the number of assisted families and prevent 

additional vouchers from becoming unfunded. OIG also recommended 

that HUD’s Office of Public Housing and Voucher Programs establish and 

implement a plan for the unused and unfunded vouchers to mitigate 

or prevent additional vouchers from becoming unused and unfunded. 

(Agencywide, Audit Report: 2021-CH-0001)

HUD’s Office of Multifamily Housing Programs’ Complaint 

Process Did Not Ensure That Health and Safety Complaints Were 

Resolved in a Timely Manner

OIG audited HUD’s Office of Multifamily Housing Programs’ health and 

safety complaint process. OIG conducted this audit due to a July 2019 

explosion that occurred at the Calloway Cove Apartments, a Multifamily 

Housing property in Jacksonville, FL, which resulted in a fire that injured 

several people. HUD’s Real Estate Assessment Center had identified lifethreatening health and safety deficiencies at the property for several years, 

and there had been separate concerns related to health and safety issues 

at this complex, which appear to have gone unaddressed and may have 

led to the fire. The audit objective was to determine whether HUD ensured 

that health and safety complaints associated with Multifamily HousingSection 8-assisted housing were resolved in a timely manner.

HUD’s complaint process did not ensure that health and safety complaints 

were resolved in a timely manner. 

On average, it took 2.5 days to resolve the life-threatening health and 

safety issues reviewed, including 3 days to resolve a gas leak issue. 

It took an average of 17 days to resolve the non-life-threatening health and 

safety issues, including 175 days to resolve an infestation problem. For the 

purpose of this audit, OIG determined reasonable benchmark resolution 

times to be 24 hours for resolving life-threatening health and safety 

issues and 72 hours for non-life-threatening health and safety issues. This 

condition occurred because HUD did not have a standardized, effective 

process for monitoring, tracking, and resolving complaints in a timely 

manner. As a result, Multifamily Housing tenants were, in some instances, 

faced with unhealthy and dangerous living environments for extended 

periods.

OIG recommended that the Deputy Assistant Secretary for Multifamily 

Housing Programs (1) develop a comprehensive process to ensure 

that complaints received by the Multifamily Housing Clearinghouse 

are resolved in a timely manner; (2) develop agencywide policies and 

procedures for the intake, monitoring, and tracking of health and safety 

complaints; (3) develop an automated real-time system for receiving, 

tracking, and resolving health and safety issues; and (4) revise the annual 

contributions contract to more clearly define contractor and property 

management responsibilities and deadlines for resolving health and safety 

issues. (Agencywide, Audit Report: 2021-KC-0004)

HUD’s Use of, Accounting for, and Reporting on CARES Act 

Funding

As of March 31, 2021, HUD had disbursed $3.4 billion and obligated $7.4 

billion of its $12.4 billion in CARES Act funds. Meanwhile, HUD had more 

than $1.6 billion in CARES Act funds unobligated. These funds had various 

expiration dates. For example, HUD had until September 30, 2021, to 

obligate $28 million of the remaining management and administration 

CARES Act funds and until September 30, 2022, to obligate more than $1.3 

billion of the remaining Office of Community Planning and Development 

CARES Act funds. If HUD is unable to obligate funds properly before its 

appropriations expire, it may have balances canceled and returned to the 

General Fund when the expired account(s) closes.

7 SNAPSHOT I HUD OIG Semiannual Report to Congress
HUD tracks all CARES Act funding in its financial systems using disaster 

emergency fund codes (DEFC) “N” and “O” assigned by the Office of 

Management and Budget and the U.S. Department of the Treasury. HUD 

incorporates these DEFCs into the fund code for each program, which 

allows HUD to track the status of each program’s CARES Act funds. 

Regarding the CARES Act requirement for preventing duplication of 

benefits, the Act does not specify a structure for meeting this requirement. 

According to HUD, it passed on the responsibility to prevent the 

duplication of benefits to Community Development Block Grant-CARES 

Act grantees.

HUD’s reporting process generally supports CARES Act reporting 

requirements, which are outlined in Section 15011 of the CARES Act. 

By leveraging existing reporting mechanisms, HUD has established 

a process to meet portions of its Pandemic Response Accountability 

Committee (PRAC) quarterly reporting requirement on behalf of covered 

recipients. 

However, HUD’s process does not support reporting quarterly on the 

estimated number of jobs created or retained or on subrecipient data 

as required for covered recipients in the CARES Act. Further, unclear 

reporting requirements and the required reporting schedule pose 

challenges to HUD’s quarterly reporting to the PRAC. As of March 31, 2021, 

OIG had undertaken 26 reviews related to the CARES Act, of which 1 report 

offers a recommendation on CARES Act-related accounting. OIG has 

published two other reports highlighting the need for customer servicerelated improvements. OIG has several ongoing reviews and continues 

to perform oversight work related to the CARES Act. (Agencywide, 

Evaluation Report: 2021-OE-0006 )

Opportunities Exist To Improve the U.S. Department of Housing 

and Urban Development’s Hiring Process 

While some of HUD’s efforts to improve its hiring and human capital 

functions and reduce its average time-to-hire have been successful, 

HUD’s hiring process overall was not efficient. HUD’s Office of the Chief 

Human Capital Officer (OCHCO), which is responsible for developing and 

implementing policies and procedures associated with human capital 

management, set a goal to reduce the average time-to-hire but did not 

meet this goal. OCHCO must implement efforts to improve HUD’s hiring 

and human capital functions and increase hiring efficiency as defined in its 

own human capital operating plans.

Hiring process owners, including program office hiring managers and 

administrative staff, received limited and inconsistent training on the 

hiring process and were not aware of the roles or responsibilities in 

the hiring process. The unclear roles and responsibilities, along with 

the inconsistent training, impacted HUD’s ability to hire efficiently. 

Additionally, OCHCO had inconsistent and unreliable hiring data due to 

the manual nature of its data entry process and the lack of interaction 

among the various data-tracking tools. As a result, OCHCO may not 

fully understand how well HUD’s hiring process is operating or where 

its shortcomings exist. The unreliable hiring data impede OCHCO’s and 

the program offices’ ability to properly identify when to take actions for 

improvement.

OIG offered 11 recommendations to improve HUD’s hiring process. 

Six of the recommendations are aimed at process reform, and five 

recommendations are designed to support data improvement. The status 

of each recommendation is unresolved-open. (Agencywide, Evaluation 

Report: 2020-OE-0002 )

8 SNAPSHOT I HUD OIG Semiannual Report to Congress
Making an Impact

OIG’s oversight work results in recommendations to encourage improvements 

in the conduct of government programs and operations. This section 

highlights connections between OIG’s work and positive impact for HUD’s 

programs, operations, mission, and beneficiaries. While there are many factors 

that may cause programmatic change, OIG’s reviews and other work often 

play a role. This section draws attention to recommendations closed during 

this semiannual reporting period that have made a positive impact on HUD’s 

mission and operations.

Office of Administration - Privacy Data and Records 

Management

The Office of Administration closed 10 recommendations associated with 

OIG evaluations of HUD’s privacy and records programs. Five of these 

recommendations enabled HUD to address critical program leadership 

and governance issues and prioritize remediation of longstanding 

agency privacy and records management risks. Four recommendations 

established foundational requirements for improving HUD’s identification 

and protection of personally identifiable information within its 

environment. Three of the ten recommendations had been open for more 

than 5 years, reflecting HUD’s increased focus on improving its privacy 

and records programs. HUD’s efforts to close OIG recommendations have 

positively impacted HUD’s progress in improving its Privacy and Records 

Management programs.

Office of the Chief Information Officer - Modernizing Technology 

and the Management and Oversight of Information Technology

During this semiannual reporting period, HUD closed 37 recommendations 

associated with OIG Federal Information Security Modernization Act of 

2014 (FISMA) evaluations and financial statement application audits. The 

Office of the Chief Information Officer (OCIO) made a concerted effort to 

resolve recommendations that impacted both cybersecurity and financial 

internal controls. A portion of the closures addressed HUD weaknesses 

that had existed for up to 5 years. OIG recommendations addressed a wide 

array of criteria measures for the eight FISMA domains and the Federal 

Information System Controls Audit Manual, but all impacted HUD’s overall 

improvements in information technology (IT), cybersecurity, and financial 

reporting.

OCIO has resolved seven IT recommendations that directly contributed to 

improvements in the Information Security Continuous Monitoring FISMA 

domain, which is now assessed at the consistently implemented maturity 

level. 

Overall, since 2013, OIG has made 220 FISMA-related recommendations, 

OCIO has closed 159 of that subgroup, and those changes continue to 

enhance HUD’s security posture. HUD now has five of the eight FISMA 

domains at the consistently implemented maturity level. Further, during 

this semiannual reporting period, OCIO has resolved 15 recommendations 

associated with general and application controls audit work in support of 

the annual financial statements audits, which shows that HUD is making a 

concerted effort toward improving its financial management systems.

9 SNAPSHOT I HUD OIG Semiannual Report to Congress
HOUSING

The Office of Housing plays a vital role for the Nation’s home buyers, homeowners, renters, and communities through its nationally administered programs. 

It includes the Offices of Single Family Housing and Multifamily Housing Programs and the Federal Housing Administration (FHA), the largest mortgage 

insurer in the world. FHA single-family programs provide mortgage insurance to mortgage lenders that, in turn, provide financing that enables individuals 

and families to purchase, rehabilitate, or construct homes. The Office of Multifamily Housing’s mortgage insurance programs facilitate the construction, 

substantial rehabilitation, purchase, and refinancing of multifamily properties. The office also administers subsidized housing programs that provide rental 

assistance to low-income families, the elderly, and those with disabilities, as well as the preservation of assisted affordable housing. The Office of Healthcare 

Programs administers FHA’s mortgage insurance programs that help finance the construction, renovation, acquisition, or refinancing of healthcare facilities -- 

including hospitals, nursing homes, and assisted living facilities. AUDIT

3

KEY PROGRAM

RESULTS

0

RECOMMENDED FUNDS 

PUT TO BETTER USE

0

RECOMMENDED

QUESTIONED COSTS

INVESTIGATION

$8,358,509

INVESTIGATIVE

RECOVERIES

26

CONVICTIONS - PLEAS -

PRETRIAL DIVERSIONS

6

ADMINISTRATIVE - 

CIVIL ACTIONS

10 HOUSING I HUD OIG Semiannual Report to Congress
OFFICE OF AUDIT

Promoting a Homeless Waitlist Preference at MultifamilyAssisted Rental Unit Properties

HUD’s Office of Inspector General (OIG) provided HUD’s Office of Housing 

with an informative memorandum on promoting a homeless waitlist 

preference at Multifamily Housing rental assistance properties. OIG found 

that homeless move-in rates were significantly higher at properties that 

had waitlist preferences for previously homeless applicants. HUD should 

revisit the promotion and marketing of its homeless waitlist preference 

and consider partnering with a homeless service provider. Additionally, 

HUD can take this opportunity to make changes to the program and 

adopt additional incentives to increase the likelihood of owner and agent 

participation. Lastly, HUD should consider updating its public website to 

make it more likely that someone with limited resources and knowledge 

of its site can successfully identify Multifamily Housing rental assistance 

properties in his or her area.

Agencywide, Audit Memorandum: 2021-KC-0802

HUD’s Office of Multifamily Housing Programs’ Complaint 

Process Did Not Ensure That Health and Safety Complaints Were 

Resolved in a Timely Manner

OIG audited HUD’s Office of Multifamily Housing Programs’ health and 

safety complaint process to determine whether HUD ensured that health 

and safety complaints associated with Multifamily Section 8-assisted 

housing were resolved in a timely manner. OIG found that HUD’s 

complaint process did not ensure that health and safety complaints were 

resolved in a timely manner because HUD did not have a standardized, 

effective process for monitoring, tracking, and resolving complaints in 

a timely manner. OIG made four recommendations to HUD focused on 

developing policies and processes to improve the intake, tracking, and 

resolution of complaints, as well as revising the annual contributions 

contract to clearly define contractor and property management 

responsibilities for resolving health and safety issues. 

Agencywide, Audit Report: 2021-KC-0004

COVID-19 Forbearance Data in HUD’s Single Family Default 

Monitoring System Generally Agreed With Information 

Maintained by Loan Servicers

OIG audited the lender reporting of COVID-19 forbearances for FHAinsured loans in the Single Family Default Monitoring System (SFDMS). 

OIG compared default reporting data from SFDMS to loan data provided 

by five sampled servicing lenders that serviced a third of the FHA singlefamily portfolio. The audit objective was to determine whether COVID-19 

forbearance data available in SFDMS were consistent with the information 

maintained by loan servicers. OIG found that COVID-19 forbearance 

data available in SFDMS were generally consistent with the information 

maintained by the loan servicers reviewed and that key metrics showed 

that servicers generally complied with HUD’s forbearance reporting 

requirements. OIG made no recommendations. 

Agencywide, Audit Report: 2021-KC-0005

11 HOUSING I HUD OIG Semiannual Report to Congress
OFFICE OF INVESTIGATION

HUD-Approved Direct Endorsement Lender Agrees To Pay $2 

Million

DHI Mortgage Company, LTD, a HUD-approved direct endorsement lender, 

entered into an indemnification agreement with HUD and agreed to pay 

$2 million to HUD to indemnify HUD from its losses in connection with 

violations of FHA underwriting guidelines by DHI during the origination 

of 31 FHA-insured mortgages. The agreement does not constitute an 

admission of liability or fault on the part of the parties.

Washington, DC

Father and Son Collectively Sentenced to 58 Months Incarceration

Dr. Rafael Otero, former majority owner of the Magnolia Alzheimer’s Assisted 

Living facility, and Antonio Otero, facility administrator for Magnolia, were 

collectively sentenced in U.S. District Court to 58 months incarceration and 

4 years supervised release. Magnolia was financed with an FHA Section 

232-insured loan, which provided a favorable interest rate and did not 

require the owners of Magnolia to take personal responsibility for the loan 

when it went into default. HUD suffered the financial loss when Magnolia 

defaulted on the loan and the property went into foreclosure. Magnolia 

agreed to be bound by a regulatory agreement with HUD that prohibited 

the owners from receiving money from Magnolia unless the loan was 

being paid and Magnolia had surplus cash. Instead of paying the loan 

and in violation of the regulatory agreement, the Oteros took hundreds of 

thousands of dollars from Magnolia. Antonio was sentenced in connection 

with his earlier guilty plea to equity skimming and was ordered to pay $2 

million in restitution to HUD. Rafael was sentenced in connection with his 

earlier guilty plea to fraud against HUD and was ordered to pay jointly and 

severally with Antonio more than $3.6 million in restitution to HUD. 

Texarkana, TX

Landlord Enters Into $805,000 Settlement Agreement With HUD

Eugene Rosen, owner of Ellsworth Partners, LLC, the owner of Ellsworth 

Commons, a mixed-use residential and commercial property, entered into 

a settlement agreement and agreed to pay $805,000 to HUD to resolve 

allegations that he made improper payments to his family trusts while 

disregarding his obligation to make payments on Ellsworth Commons’ FHAinsured mortgage. Rosen also submitted a false statement to FHA related 

to those payments, which violated the civil equity skimming statute and the 

Financial Institutions Reform, Recovery, and Enforcement Act of 1989. In 

2010, Ellsworth Partners obtained an FHA-insured mortgage to finance the 

construction of Ellsworth Commons. FHA agreed that if Ellsworth Partners 

defaulted on the mortgage, FHA would pay the outstanding balance to the 

lender. In exchange, Ellsworth Partners agreed to use project revenue only 

for FHA-authorized purposes. However, for more than 2 years, Ellsworth 

Partners stopped paying its mortgage but continued to transfer money 

to family trusts, causing the mortgage to go into default. To prevent 

foreclosure, FHA agreed to pay down a substantial portion of the mortgage 

12 HOUSING I HUD OIG Semiannual Report to Congress
after Rosen certified that, while the mortgage was in default, Ellsworth 

Partners paid to its lender all net cash remaining after project expenses had 

been paid, which was untrue. HUD OIG, HUD’s Office of General Counsel, 

and HUD’s Departmental Enforcement Center conducted this investigation.

Malta, NY

13 HOUSING I HUD OIG Semiannual Report to Congress
PUBLIC AND INDIAN HOUSING

The U.S. Department of Housing and Urban Development (HUD) provides grants and subsidies to more than 3,100 public housing agencies (PHA) nationwide. 

Many PHAs administer both public housing and Section 8 programs. HUD also provides direct assistance to PHAs’ resident organizations to encourage 

increased resident management entities and resident skills programs. Programs administered by PHAs are designed to enable low-income families, the 

elderly, and persons with disabilities to obtain and reside in housing that is safe, decent, sanitary, and in good repair. Some of the highlights from this 

semiannual period are noted in this chapter. AUDIT

2

KEY PROGRAM

RESULTS

$24,250

RECOMMENDED FUNDS 

PUT TO BETTER USE

$44,256

RECOMMENDED

QUESTIONED COSTS

INVESTIGATION

$6,934,938

INVESTIGATIVE

RECOVERIES

21

CONVICTIONS - PLEAS -

PRETRIAL DIVERSIONS

13

ADMINISTRATIVE - 

CIVIL ACTIONS

14 PUBLIC AND INDIAN HOUSING I HUD OIG Semiannual Report to Congress
OFFICE OF AUDIT

HUD Remains Challenged To Serve the Maximum Number of 

Eligible Families Due to Decreasing Utilization in the Housing 

Choice Voucher Program

HUD’s Office of Inspector General (OIG) conducted an audit to assess 

HUD’s oversight of voucher utilization and reallocation in the Housing 

Choice Voucher Program. OIG found that while HUD’s voucher utilization 

rate had decreased, it is estimated that as of November 2020, more than 

62 percent of PHAs in the Program had leasing potential, which could 

increase in 2021. OIG recommended that HUD establish and implement 

a plan to assist PHAs in optimizing their leasing potential to maximize the 

number of families assisted and to prevent additional vouchers from being 

unfunded. OIG also recommended that HUD establish and implement a 

plan for the unused and unfunded vouchers to mitigate the situation or 

prevent additional vouchers from becoming unused and unfunded.

Agencywide, Audit Report: 2021-CH-0001

The Bay City Housing Authority, Bay City, TX, Did Not Follow 

Requirements for Its Legal Services, Contract, Administrative 

Costs, and Board Meetings

Based on a complaint and a request from the Office of Public and Indian 

Housing (PIH), OIG audited the Bay City Housing Authority, Bay City, 

TX. OIG audit objectives were to determine whether the Authority (1) 

followed Federal and its own procurement requirements for the board’s 

legal services, (2) paid its administrative costs in accordance with Federal 

requirements, and (3) conducted its board meetings in accordance with 

the State of Texas’ requirements. OIG found that the Authority improperly 

procured its legal services contract, paid ineligible and unsupported 

administrative costs, and did not follow Texas’ Open Meetings Act or its 

own bylaws when conducting board meetings. OIG recommended that 

the Director of the Houston Office of Public Housing require the Authority 

to (1) recover the remaining $5,000 in ineligible legal service costs paid 

and ensure that additional invoiced legal service costs totaling $24,250 

are not paid; (2) support or repay questioned costs totaling $39,256; (3) 

update its bylaws, policies, and procedures to reflect current Federal 

and State of Texas requirements; and (4) take action to address invalid or 

undocumented board decisions.

Bay City, TX, Audit Report: 2021-FW-1003

OFFICE OF INVESTIGATION

Former Public Housing Agency Executive Director Sentenced to 

46 Months Incarceration

Monica Moneymaker, former executive director of a PHA, was sentenced in 

U.S. District Court in connection with her earlier guilty plea to conspiracy 

to embezzle from a federally funded program. For more than 3 years, 

Moneymaker embezzled the PHA’s collected cash receipts from tenant 

rental payments. Moneymaker was sentenced to 46 months incarceration 

and 1 year supervised release and ordered to pay $562,138 in restitution to 

HUD.

Amarillo, TX

15 PUBLIC AND INDIAN HOUSING I HUD OIG Semiannual Report to Congress
Former Public Housing Agency Finance Officer Ordered To Pay 

Nearly $5.3 Million in Restitution

Cova Campbell, a former finance officer for a PHA, was sentenced in 

U.S. District Court in connection with her earlier guilty plea to wire 

fraud. Campbell was sentenced to 51 months incarceration and 3 years 

supervised release and ordered to pay nearly $5.3 million in restitution, 

of which more than $4.2 million will be paid to the PHA. For more than 

3 years, Campbell used a variety of schemes to embezzle $6.9 million 

in public money. Campbell diverted PHA funds in connection with 

the purchase of land and prepared and submitted false invoices to the 

PHA by making them appear as if the purchases were from an outside 

vendor. HUD OIG, the Federal Bureau of Investigation (FBI), the U.S. 

Attorney’s Office, and the Washington State Auditor’s Office conducted this 

investigation.

Tacoma, WA

Businessman Sentenced to 14 Months in Prison for Paying 

Bribes to Former HUD and District of Columbia Employees

Charles Thomas, owner of a Maryland-based company that provided 

information technology services to Federal agencies and educational 

services to public school children in the Washington, DC, area; Kevin Jones 

and LaFonda Lewis, former HUD employees; and Shauntell Harley, a former 

employee of the District of Columbia Office of the State Superintendent 

of Education (OSSE), were collectively sentenced in U.S. District Court to 

92 months and 1 day incarceration and 8 years supervised release and 

ordered to pay $747,667 in restitution, of which $668,310 is to be paid 

to the OSSE and $79,357 to the U.S. Department of the Treasury. For 

almost 5 years, Thomas provided Jones and Lewis with merchandise and 

cash payments valued at more than $70,000 in exchange for nonpublic 

information about HUD-funded contracts. Additionally, for more than 

a year, Thomas made more than $50,000 in cash payments to Harley 

in exchange for receiving the information needed to create fraudulent 

invoices for services that his company did not provide. HUD OIG, the FBI, 

and the District of Columbia OIG conducted this investigation.

Washington, DC

16 PUBLIC AND INDIAN HOUSING I HUD OIG Semiannual Report to Congress
COMMUNITY PLANNING AND DEVELOPMENT

The Office of Community Planning and Development (CPD) works in conjunction with all levels of government and the private sector to develop viable 

communities by promoting integrated approaches that provide decent housing, suitable living environments, and expanded economic opportunities for 

low- and moderate-income persons. Some of the highlights from this semiannual period are outlined in this chapter. Additionally, in response to disasters, 

Congress may appropriate additional funding to Community Development Block Grant Disaster Recovery (CDBG-DR) grants to rebuild the affected areas and 

provide crucial seed money to start the recovery process. Since fiscal year 2001, the U.S. Department of Housing and Urban Development (HUD) has allocated 

$89.8 billion in CDBG-DR and CDBG Mitigation grants to help cities, counties, and States recover from presidentially declared disasters. Of the $89.8 billion in 

disaster allocations nationwide, nearly $84.8 billion has been obligated, and more than $46.7 billion has been disbursed as of the end of the period. AUDIT

3

KEY PROGRAM

RESULTS

$9,736,636

RECOMMENDED FUNDS 

PUT TO BETTER USE

$1,260,680

RECOMMENDED

QUESTIONED COSTS

INVESTIGATION

$2,517,362

INVESTIGATIVE

RECOVERIES

7

CONVICTIONS - PLEAS -

PRETRIAL DIVERSIONS

4

ADMINISTRATIVE - 

CIVIL ACTIONS

17 COMMUNITY PLANNING AND DEVELOPMENT I HUD OIG Semiannual Report to Congress
OFFICE OF AUDIT

Harris County Community Services Department, Houston, TX, 

Was Inefficient and Ineffective in Operating Its Hurricane Harvey 

Program

HUD’s Office of Inspector General (OIG) audited the Harris County 

Hurricane Harvey CDBG-DR program to assess its efficiency and 

effectiveness and whether the program was assisting disaster participants 

in a timely manner; specifically, to examine the status of its HUD-approved 

activities and challenges, if any, in implementing the activities. OIG 

found that Harris County had not efficiently or effectively operated its 

Hurricane Harvey CDBG-DR program. Specifically, 3 years after Hurricane 

Harvey, Harris County had assisted only 112 of 4,513 planned program 

participants and had spent less than 1 percent of its grant funds. Harris 

County’s challenges included an inability to effectively assist applicants 

and inefficiencies in its reimbursement program. OIG recommended 

that HUD require the Texas General Land Office to (1) provide its plan 

to continuously monitor Harris County’s pace and performance in its 

remaining program and take appropriate action to ensure that program 

goals are met; (2) set performance and financial milestones for all 

programs and activities funded under Harris County’s subrecipient 

agreement; (3) monitor Harris County’s capacity to manage its funds 

and address duplicative, inefficient, and cost-prohibitive processes or 

positions; and (4) review Harris County’s priorities for providing assistance 

to program participants.

Houston, TX, Audit Report: 2021-FW-1001

The City of Houston’s Housing and Community Development 

Department, Houston, TX, Did Not Always Ensure That Its 

Program Followed Procurement Requirements

OIG audited the City of Houston’s CDBG-DR 2015 program, which made 

the Consolidated Appropriations Acts of 2016 and 2017 funds available 

for necessary expenses related to disaster relief, long-term recovery, 

restoration of infrastructure and housing, and economic revitalization. 

OIG’s objective was to determine whether the City ensured that it 

maintained adequate supporting documentation for disbursements 

and its program complied with procurement requirements. OIG found 

that the City generally ensured that it maintained adequate supporting 

documentation for disbursements; however, it did not always ensure that 

its program complied with the necessary HUD procurement requirements, 

did not maintain the necessary documentation to support costs, and did 

not have adequate contract provisions. OIG recommended that HUD 

require the City to (1) support that it awarded contracts without restriction 

and in a manner advantageous to it and HUD or put the more than $9.7 

million in contract awards to better use, (2) support or repay more than 

$1.2 million in contract disbursements, and (3) develop and implement 

written procedures and take actions to better ensure that it and its 

subrecipients meet all program procurement requirements.

Houston, TX, Audit Report: 2021-FW-1002

18 COMMUNITY PLANNING AND DEVELOPMENT I HUD OIG Semiannual Report to Congress
HUD’s Major Program Offices Can Improve Their Preparedness 

To Respond to Upcoming Natural Disasters

OIG audited HUD’s disaster preparedness from 2005 to 2018 to determine 

whether HUD’s Offices of Multifamily Housing Programs, Single Family 

Housing, Community Planning and Development, Native American 

Programs, and Public Housing can improve their preparedness to respond 

to upcoming natural disasters. OIG found that each program office 

reviewed had weaknesses in its written policies and supervisory controls. 

The Offices of Multifamily and Single Family had control weaknesses 

in their postdisaster information-gathering activities. The Offices of 

Community Planning and Development and Native American Programs 

had weaknesses in their controls to ensure that all affected grantees and 

housing entities were contacted following a disaster. The Office of Public 

Housing did not track its outreach to public housing agencies (PHA). OIG 

made five recommendations, one for each program office, related to 

effective policies, procedures, and supervisory controls, including controls 

for contacting grantees and tracking outreach to PHAs.

Agencywide, Audit Report: 2021-KC-0003

OFFICE OF INVESTIGATION

11 Demolition Contractors and Government Officials Sentenced 

in Bribery Scheme

Demolition contractors Joseph Tucceri, Gwen Tucceri, Consuelo Brown, 

Paul Eadah, Martin Fano, Eric Whitherspoon, and Gani Xhoka, along with 

Ken Tyson, Vanessa Veals, Rufus Taylor, and Gary Norton, government 

officials for local municipalities, were collectively sentenced in U.S. District 

Court to 6 years incarceration, 11 years probation, and 7 years supervised 

release and ordered to pay $44,000 in fines. For more than 6 years, the 

conspirators devised and participated in a scheme to defraud local 

municipalities, which were recipients of more than $19 million in HUDfunded CDBG grants. The conspirators paid cash bribes and things of value 

to Taylor in exchange for expedited service and favorable treatment for 

work performed on demolition contracts. HUD OIG; the Internal Revenue 

Service, Criminal Investigation; and the Federal Bureau of Investigation 

conducted this investigation.

Cleveland, OH

19 COMMUNITY PLANNING AND DEVELOPMENT I HUD OIG Semiannual Report to Congress
OTHER SIGNIFICANT 

AUDITS AND 

EVALUATIONS

The U.S. Department of Housing and Urban Development (HUD), Office of 

Inspector General’s (OIG) additional significant reports are highlighted in this 

chapter.

OFFICE OF AUDIT

HUD Did Not Fully Comply With the Payment Integrity 

Information Act of 2019

OIG audited HUD’s fiscal year 2020 compliance with the Payment Integrity 

Information Act of 2019 (PIIA) and the Office of Management and Budget 

guidance on improper payments reduction requirements. HUD did 

not fully comply with PIIA reporting and improper payments reduction 

requirements for fiscal year 2020. Of the six requirements, HUD did not 

comply with one requirement, and one requirement was not applicable. 

As a result, HUD’s programs were vulnerable to the adverse effects of 

improper payments, and HUD will likely continue to miss opportunities to 

prevent, identify, reduce, and recover improper payments unless it fully 

complies with PIIA reporting and reduction requirements. However, OIG 

recognized that HUD was making progress in being fully compliant with 

PIIA and acknowledged its plan to execute a comprehensive sampling 

and estimation methodology in the coming year. OIG recommended that 

HUD use a comprehensive sampling and estimation methodology for all 

reported programs and disclose in its reporting any limitations imposed or 

encountered.

Agencywide, Audit Report: 2021-AT-0002

Limited Review of HUD’s Office of Chief Procurement Officer 

Pandemic-Related Procurement Accommodations and 

Challenges

OIG conducted a limited review of HUD’s Office of the Chief Procurement 

Officer’s (OCPO) administration of five procurement activities under the 

Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The CARES 

Act and related Office of Management and Budget memorandums gave 

HUD flexibility in modifying existing contracts and required rapid delivery 

of CARES Act funds. The audit’s objective was to determine what HUD 

had done to accommodate contractors’ pandemic-related issues while 

ensuring that HUD met its business objectives, as well as determining what 

challenges HUD encountered in procuring and administering its contracts 

during the pandemic. Based on a limited review of five COVID-19-related 

contract transactions and OIG’s understanding of the prepandemic 

controls and policies that HUD had in place, OIG found that HUD was 

adequately prepared before the pandemic to accommodate contractors’ 

pandemic-related issues while ensuring that HUD met its business 

objectives. Because HUD was adequately prepared, it did not encounter 

any substantial challenges in procuring and administering its contracts. 

OIG did not make any recommendations to HUD. 

Agencywide, Audit Memorandum: 2021-FW-0801

20 OTHER SIGNIFICANT AUDITS AND EVALUATIONS I HUD OIG Semiannual Report to Congress
OFFICE OF EVALUATION

HUD Program Offices’ Policies and Approaches for Radon

HUD does not have a departmentwide policy for dealing with radon 

contamination but, rather, relies on each program office to develop radon 

policies that align with HUD’s environmental regulations. OIG reviewed 

three program offices, the Offices of Multifamily Housing Programs, 

Public and Indian Housing, and Community Planning and Development, 

which were found to not have consistent radon policies. Without a 

departmentwide radon policy, each program office has independently 

developed a radon policy or approach with varying degrees of testing 

and mitigation requirements. This approach does not align with HUD’s 

environmental regulations or support industry standards, which state 

that radon testing should occur every 2 years after a mitigation system 

is installed. Given that environmental reviews generally occur only for 

specific funding or approval actions and exposure to radon shows no 

immediate health effects or other warning signs, HUD cannot ensure 

that residents in HUD-assisted housing receive consistent and sufficient 

protection from the hazardous health effects of radon exposure. OIG 

has made seven recommendations to help HUD better protect residents 

from hazardous health risks of indoor radon exposure, to include that 

HUD develop and issue a departmentwide policy that notes that radon 

is a radioactive substance, ensures that radon testing and mitigation are 

consistent and sufficient for all HUD programs, and aligns with HUD’s 

environmental regulations. The Office of Environment and Energy 

indicated it aimed to publish the department wide policy in the fourth 

quarter of FY 21. The recommendation remains open.

Agencywide, Evaluation Report: 2020-OE-0003

HUD’s Use of, Accounting for, and Reporting on CARES Act 

Funding

As of March 31, 2021, HUD had disbursed $3.4 billion and obligated $7.4 

billion of its $12.4 billion in CARES Act funds. Meanwhile, HUD has more 

than $1.6 billion in CARES Act funds unobligated. These funds have 

various expiration dates, and if HUD is unable to obligate funds properly 

before its appropriations expire, it may have balances canceled and 

returned to the General Fund when the expired accounts close. HUD’s 

reporting process generally supports CARES Act reporting requirements 

by leveraging existing reporting mechanisms, which meet portions of its 

Pandemic Response Accountability Committee (PRAC) quarterly reporting 

requirement on behalf of covered recipients. However, HUD’s process does 

not support quarterly reporting on the estimated number of jobs created 

or retained or on subrecipient data, as required for covered recipients 

in the CARES Act. Additionally, unclear reporting requirements and the 

required reporting schedule pose challenges to HUD’s quarterly reporting 

to the PRAC.

Agencywide, Evaluation Report: 2021-OE-0006

2021 Persistent IT Challenges and Issues Facing HUD

OIG conducted a topic brief that highlights key challenges HUD faces managing 

and improving its IT program. The brief is not based on new work, but is a 

summary of 83 reports and 788 recommendations from past HUD OIG and GAO 

reports. It discusses the present IT environment at HUD, previously identified and 

new IT-related challenges, and HUD’s efforts and progress in addressing these 

challenges. Based on our analysis of open IT recommendations, we concluded 

that HUD’s IT program, including its modernization efforts, have improved. 

21 OTHER SIGNIFICANT AUDITS AND EVALUATIONS I HUD OIG Semiannual Report to Congress
Additionally, HUD’s Office of the Chief Information Officer (OCIO) made notable 

progress. Nonetheless, OCIO will require continued support and resources to 

implement IT plans and projects to overcome identified challenges.

Agencywide, Evaluation Topic Brief: 2021-OE-0004

HUD IT Modernization Roadmap Evaluation Report

OIG reviewed HUD’s information technology (IT) modernization 

roadmap to (1) determine the extent to which HUD has developed an IT 

modernization roadmap and to report on its current and future state, (2) 

gain an understanding of HUD’s IT modernization strategy and priorities, 

and (3) assess the effectiveness of the roadmap and strategy. OIG found 

that a significant number of HUD’s mission-essential applications have 

not been modernized, which presents multiple sources of risk. These 

applications are hosted on legacy information systems and mainframe 

platforms, which are operationally inefficient, increasingly difficult 

to secure, and costly to maintain. As a result, hundreds of millions of 

dollars in potential savings from modernization have not been realized, 

and security risks have remained. This evaluation report contains two 

recommendations and five opportunities for improvement to assist in 

continued successes for future modernization efforts.

Agencywide, Evaluation Report: 2021-OE-0003

Opportunities Exist To Improve the U.S. Department of Housing 

and Urban Development’s Hiring Process

While some of HUD’s efforts to improve its hiring and human capital 

functions and reduce its average time-to-hire have been successful, 

HUD’s hiring process overall was not efficient. HUD’s Office of the Chief 

Human Capital Officer (OCHCO), which is responsible for developing and 

implementing policies and procedures associated with human capital 

management, has not met its goal to reduce the average time-to-hire. 

Hiring process owners, including program office hiring managers and 

administrative staff, received limited and inconsistent training and were 

not aware of their roles or responsibilities in the hiring process, which 

has impacted HUD’s ability to hire efficiently. Additionally, OCHCO had 

inconsistent and unreliable hiring data due to the manual nature of the 

data input and the lack of interaction among the various data-tracking 

tools. The unreliable hiring data impede OCHCO’s and the program offices’ 

ability to properly identify when to take actions for improvement. OIG 

has 11 recommendations to improve HUD’s hiring process. Six of the 

recommendations are aimed at process reform, and five recommendations 

are designed to support data improvement. In response to the report, 

OCHCO accepted all eleven recommendations and offered a number of 

promising initiatives and updates. The status of each recommendation is 

unresolved-open.

Agencywide, Evaluation Report: 2020-OE-0002

22 OTHER SIGNIFICANT AUDITS AND EVALUATIONS I HUD OIG Semiannual Report to Congress
LEGISLATION, REGULATIONS, AND 

OTHER DIRECTIVES

Reviewing and making recommendations on legislation, regulations, and policy issues is a critical part of the Office of Inspector General’s (OIG) 

responsibilities under the Inspector General Act. During this 6-month reporting period, OIG has committed more than 1,400 hours to reviewing 161 

issuances. The draft directives consisted of 97 notices, 22 mortgagee letters (ML), and 42 other directives. OIG provided comments on 50 (or 31 percent) of 

the issuances and nonconcurred on 9 (or 6 percent) but lifted 8 nonconcurrences. Of the 42 other directives, we reviewed two final rules and four proposed 

rules, taking no position on three, and commented on three; 18 handbooks and guidebooks; 13 research reports; two statements of policy; one discretionaryunsolicited research proposal; and two sets of frequently asked questions (FAQ) on the U.S. Department of Housing and Urban Development’s (HUD) plan of 

actions to implement Executive Order 13175 and regarding the Indian Community Development Block Grant – Imminent Threat funding under the American 

Rescue Plan Act. A summary of selected reviews for this 6-month period as follows.

0

5

10

15

20

Set of FAQs

Discretionary-unsolicited 

research proposal

Statements of policy

Research reports

Handbooks and guidebooks

Proposed rules

Final rules

2

4

18

13

1 2 2

161 TOTAL ISSUANCES OF THE 42 OTHER DIRECTIVES

Other directives Mortgagee 

letters Notices

60%

97 26%

42

14%

22

23 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
NOTICES, MORTGAGEE LETTERS, AND OTHER DIRECTIVES

SINGLE FAMILY HOUSING

Handbook 4000.1, FHA Single Family Housing Policy Handbook - On April 

19 and July 21, 2021, HUD issued updates to the FHA [Federal Housing 

Administration] Single Family Housing Policy Handbook (Handbook 

4000.1). Handbook changes incorporated previously issued MLs and 

other various policy updates. OIG provided a no position response to this 

issuance.

Amendments to HUD’s nonborrowing spouse policy for all HECM 

loans - On May 6, 2021, HUD issued ML 2021-11, amending regulations 

for home equity conversion mortgages (HECM) regarding nonborrowing 

spouses that apply to all HECM loans, regardless of case number 

assignment, that comprise a valid first lien security interest in real property 

under applicable State law. OIG provided a no position response to this 

ML. 

Eligibility requirements for certain nonpermanent resident borrowers

- On May 28, 2021, HUD issued ML 2021-12, clarifying the eligibility of FHAinsured financing for Deferred Action for Childhood Arrivals recipients, 

while amending the documentation requirements for citizens of the 

Freely Associated States and H-1B nonimmigrants. OIG provided editorial 

comments on this ML. 

Student loan payment calculation of monthly obligation - On June 

17, 2021, HUD issued ML 2021-13, informing lenders of new student loan 

calculation requirements of the monthly payment obligation, to align 

better with the current industry standards. OIG provided a no position 

response to this ML.

Extension of implementation date for the April 19, 2021, publication 

of the Single Family Housing Policy Handbook 4000.1 - On June 24, 

2021, HUD issued ML 21-14, extending the implementation date for 

Section III - Servicing and Loss Mitigation, Appendix 4.0 - FHA-Home 

Affordable Modification Program Calculations, and Appendix 5.0 - HUD 

Schedule of Standard Possessory Action and Deed-in-Lieu of Foreclosure 

Attorney Fees, of the Single Family Housing Policy Handbook (Handbook 

4000.1). OIG provided a no position response to this ML.

Extension of the end date for COVID-19 updated temporary guidance 

for verification of self-employment, rental Income, and the 203(k) 

rehabilitation escrow account - On June 29, 2021, HUD issued ML 

2021-16, announcing an extension of the effective period for ML 2020-

24, published on July 29, 2020, and extended in ML 2021-07, dated 

February 23, 2021. This extension allows industry partners an additional 

opportunity to utilize flexible guidance related to verification of selfemployment and verification of rental income for single-family Title II 

forward mortgage and HECM programs and 203(k) escrow administration 

for the 203(k) Rehabilitation Program, in response to impacts from the 

presidentially declared COVID-19 national emergency. OIG provided a no 

position response to this ML.

Extension of the foreclosure and eviction moratorium and expiration 

of the foreclosure moratorium in connection with the presidentially 

declared COVID-19 national emergency, further expansion of the 

COVID-19 forbearance and the COVID-19 HECM extensions, and 

establishment of the COVID-19 advance loan modification - On July 

30, 2021, HUD issued ML 2021-19, informing lenders of the extension 

of the foreclosure-related eviction moratorium for an additional period 

through September 30, 2021, and reminding them of the expiration of 

the foreclosure moratorium. Earlier HUD issued ML 2021-15 on June 

24 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
25, 2021, informing lenders of an extension to the foreclosure and 

eviction moratorium originally issued in ML 2020-04 and most recently 

extended in ML 2021-05 for borrowers with FHA-insured single-family 

mortgages for an additional period through July 31, 2021. ML 20-15 

further extended the start dates of the initial COVID-19 forbearance and 

HECM extension, provided additional COVID-19 forbearance and HECM 

extensions for certain borrowers, and established the COVID-19 advance 

loan modification and an associated default status code. OIG provided no 

position responses to these MLs.

FHA Catalyst: Single Family Default Monitoring System Reporting 

Module - On September 13, 2021, HUD issued ML 2021-21, announcing 

the transition of the Single Family Default Monitoring System from FHA 

Connection to FHA Catalyst. This ML also updates and adds default 

reporting error codes and streamlines the data elements. OIG provided a 

no position response to this ML.

Mandatory transition to the FHA Catalyst: Electronic Appraisal 

Delivery Module for FHA single-family appraisals - On September 15, 

2021, HUD issued ML 2021-23, announcing the mandatory use date for 

the FHA Catalyst: Electronic Appraisal Delivery Module for all single-family 

origination appraisal deliveries as well as the expanded availability for the 

delivery of HECM appraisals. OIG provided a no position response to this 

ML.

PUBLIC AND INDIAN HOUSING

Notice of continuation of demonstration to test proposed new 

method of assessing the physical conditions of voucher-assisted 

housing - On June 8, 2021, HUD published a notice (Federal Register (FR)-

5928-N-03), which announces the continuation of HUD’s demonstration 

to test the new method of assessing the physical condition of housing 

assisted by HUD vouchers (voucher-assisted housing) through October 

1, 2022, and renews its call for additional public housing agency (PHA) 

volunteers (eligible PHAs administering the Housing Choice Voucher 

Program). This continuation supports HUD’s ability to align the Program 

with the National Standards for the Physical Inspection of Real Estate 

physical inspection model and to assess the Program’s inspection 

protocol against this model. With this notice, HUD is also lifting the 3-year 

limitation to PHA participation in the program. Current PHA volunteers 

may continue to participate beyond the previous 3-year limitation and 

for the duration of the demonstration. HUD, therefore, extends this 

demonstration through October 1, 2022. OIG provided minor editorialrelated comments regarding this notice. 

Voucher Management System - On August 20, 2021, HUD issued a 

notice (FR-7040-N-09), which proposes the need for information using 

forms HUD–52681–B, 52672, 52681, 52663, and 52673. The Voucher 

Management System (VMS) supports the information management needs 

of the Housing Choice Voucher Program and management functions 

performed by the Financial Management Center and the Financial 

Management Division of the Office of Public and Indian Housing and the 

Real Estate Assessment Center. The automated form 52681-B is entered by 

the PHA into the VMS monthly during each calendar year to track leasing 

and housing assistance payments expenses by voucher category, as well 

as data concerning fraud recovery, Family Self-Sufficiency program escrow 

accounts, PHA-held equity, etc. The forms HUD-52672, 52681, 52663, and 

52673 are used to identify the amount of annual contributions that are 

received and disbursed by the PHA, indicate requested funds and monthly 

amounts, and estimate PHAs’ total required annual contributions. OIG 

commented on the warning and certification language on forms HUD52663 and 52681. OIG recommended that HUD change the language 

25 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
and explained that U.S. Department of Justice, State, or local prosecutorial 

offices prosecute false claims and statements, not HUD. OIG later noted 

that those forms were not attached in the Federal Register; however, when 

looking on HUD’s website for the forms, OIG also noted that the forms had 

not been changed and still included the original language despite OIG’s 

comments. 

Rental Assistance Demonstration: postconversion replacement 

of units under a PBV housing assistance payments contract - On 

September 10, 2021, HUD published a notice (FR-6276-N-01), which 

establishes the process by which assisted units under a Project-Based 

Voucher Program (PBV) Section 8 housing assistance payments (HAP) 

contract originally executed through a conversion under the Rental 

Assistance Demonstration Program (RAD) can be replaced if the original 

units were unavailable for occupancy due to a proposed demolition and 

reconstruction of the units, as a result of natural disaster, or other causes. 

RAD already includes a provision permitting the transfer of assistance to 

a new site. By this notice, HUD is supplementing the provision to transfer 

assistance by providing a mechanism for PHAs to enter into a RAD interim 

agreement and, later, a new RAD PBV HAP contract when a direct transfer 

of the HAP contract to new, eligible units is not possible and there would 

be a temporary period when a HAP contract is not in effect. OIG provided 

a no position response to this clearance item.

MULTIFAMILY HOUSING

Prepayment of Section 202 or 208/8 direct loan project - On July 2, 

2021, HUD issued a notice (FR-7038-N-11), which requests that the Office 

of Management and Budget (OMB) reinstate a previously approved 

collection for which approval has expired. Under this notice, the project 

owner must execute the Section 202 prepayment use agreement, which 

will ensure the continued operation of the project until at least 20 years 

following the maturity date of the original loan, under terms at least as 

advantageous to existing and future tenants as the terms required by the 

original loan agreement. The use agreement must be executed by the 

owner and HUD and recorded upon HUD’s approval of the prepayment 

transaction. OIG provided a no position response regarding this notice. 

Forbearance relief and associated tenant protections for FHA-insured 

Section 202, HUD-held, and risk share multifamily loans - On July 30, 

2021, HUD issued a housing notice, H 2021-03, which provides background 

and updated guidance on its policies and procedures regarding mortgage 

forbearance relief for HUD multifamily borrowers under the following 

programs: FHA mortgage insurance, 542(c) Risk Share, Section 202 loans, 

and HUD-held loans. In addition, this notice provides guidance on eviction 

relief and protections to tenants of multifamily properties subject to 

forbearance and guidance on tenant protections for multifamily properties 

not subject to forbearance and those with HUD-assisted units. Further, 

this notice updates and consolidates the guidance provided in ML 2020-09 

and housing notice 2020-07. Specifically, this notice provides guidance on 

post-CARES Act forbearance relief and required tenant protections during 

forbearance. OIG provided a no position response regarding this notice. 

HUD multifamily rental project closing documents - On August 

13, 2021, HUD issued a notice (FR-7038-N-12), which provides many 

existing closing forms or documents used in FHA-insured multifamily 

rental project transactions. HUD is also adding to the collection of 12 

closing documents, published or referenced in chapter 19 of the 2020 

Multifamily Accelerated Processing Guide, 4430.G. OIG nonconcurred 

on this clearance item because the forms and documents have variances 

in either the warning statement, certification statement, or both. OIG 

26 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
recommended that all forms and documents use the following language 

for both the warning and certification statements: “I/We, the undersigned, 

certify under penalty of perjury that the information provided above is 

true and correct. WARNING: Anyone who knowingly submits a false claim 

or makes a false statement is subject to criminal and/or civil penalties, 

including confinement for up to 5 years, fines, and civil and administrative 

penalties. (18 U.S.C. [United States Code] §§ 287, 1001, 1010, 1012; 31 

U.S.C. §3729, 3802).” These forms and documents should be modified 

to include a statement like the one suggested above. Inclusions of 

certifications under penalty of perjury and fraud warnings help discourage 

fraud and help effectively prosecute those who commit fraud. Further, any 

language indicating that HUD will prosecute false claims and statements 

or similar language if it exists in any forms or documents should be 

removed because HUD does not prosecute. U.S. Department of Justice, 

State, or local prosecutorial offices prosecute criminal matters. HUD 

modified the language for both the warning and certification statements, 

and the nonconcurrence was lifted.

COVID-19 supplemental payment requests - On August 30, 2021, 

HUD issued a notice (FR-7038-N-16), which proposes the use of form 

HUD-52671-E, to be completed by owners of properties with Section 

8 HAP contracts, Section 202 and Section 811 project rental assistance 

contracts, Section 202-162 project assistance contracts, and Section 

202 senior preservation rental assistance contracts, who wish to receive 

a supplemental payment to offset operating cost increases to prevent, 

prepare, and respond to the effects of COVID-19. OIG nonconcurred 

on this clearance item because the form HUD-52671-E contains the 

following warning statement: “Warning: HUD will prosecute false 

claims & statements, which may result in criminal conviction and/or the 

imposition of criminal fines and/or civil penalties, to the full extent allowed 

by law.” HUD does not prosecute. U.S. Department of Justice, State, or 

local prosecutorial offices prosecute these matters. OIG recommended 

that the language be changed to a statement like the following: “I/We, 

the undersigned, certify under penalty of perjury that the information 

provided above is true and correct. WARNING: Anyone who knowingly 

submits a false claim or makes a false statement is subject to criminal and/

or civil penalties, including confinement for up to 5 years, fines, and civil 

and administrative penalties. (18 U.S.C. §§ 287, 1001, 1010, 1012; 31 U.S.C. 

§3729, 3802).” The form should be modified to include a statement like the 

one suggested above. Inclusions of certifications under penalty of perjury 

and fraud warnings help to discourage fraud and help to effectively 

prosecute those who commit fraud. HUD modified the language for the 

warning statement, and the nonconcurrence was lifted.

Annual indexing of basic statutory mortgage limits and substantial 

rehabilitation threshold - On September 9, 2021, HUD issued a notice 

(FR-6274-N-01), which provides the adjustment to the basic statutory 

mortgage limits for multifamily housing programs for calendar year 

2021 in accordance with Section 206A of the National Housing Act. The 

percentage change in the Consumer Price Index for All Urban Consumers 

(CPI-U) used for the Homeownership and Equity Protection Act of 1994 

(HOEPA) adjustment is a 0.3 percent increase, and the effective date of 

the HOEPA adjustment is January 1, 2021. The dollar amounts under 

Section 206A have been adjusted accordingly and have an effective date 

of January 1, 2021. These revised statutory limits may be applied to FHA 

multifamily mortgage insurance applications submitted or amended 

on or after January 1, 2021, so long as the loan has not been initially 

endorsed. To implement the Consumer Finance Protection Bureau’s 

(CFPB) adjustment, a one-time proration is required to the 0.3 percent 

figure, which was computed from April 2019 to April 2020. Because HUD’s 

previous dollar amounts utilized CPI-U data through December 2019, only 

interim CPI-U data from January 2020 through April 2020 are reflected 

27 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
in the calculations. The overall impact of this adjustment resulted in no 

change for calendar year 2021, because CPI-U showed minor inflation 

of 1 percent in January and February 2020 but was fully offset by minor 

deflation of 1 percent in March and April 2020, associated with COVID-19 

pandemic economic disruptions. Moving forward, HUD will continue 

to utilize the CFPB’s period (April to April) used for the HOEPA CPI-U 

adjustment, which is typically published in the August preceding the 

following January effective date. OIG provided a no position response 

regarding this notice. 

Annual revisions to base city high-cost percentage, high-cost area, 

and per-unit substantial rehabilitation threshold for 2021 - On 

September 14, 2021, HUD issued a housing notice (H 2021-04) and 

ML 2021-22, which provide the maximum mortgage amounts that 

were revised by the Consolidated Appropriations Act, 2008. Section 

221 of the general provisions of Title II of Division K of the fiscal year 

2008 Appropriations Act revises the statutory exceptions to maximum 

mortgage amounts for the FHA multifamily housing programs, listed in 

Section 221 of the fiscal year 2008 Appropriations Act, by substituting 

170 percent for the 140 percent exception of any geographical area and 

substituting 215 percent for 170 percent as the maximum exception 

allowed for a specific project. Accordingly, the statutory revision allows 

the HUD Secretary to grant exceptions to maximum mortgage limits for 

certain multifamily housing programs by up to 170 percent (equivalent 

to a 270 percent multiplier) in geographical areas where cost levels so 

require or up to 215 percent in high-cost areas (equivalent to a 315 percent 

multiplier) where necessary on a project-by-project basis. OIG provided a 

no position response regarding this notice and the corresponding ML. 

Continued availability of funds for COVID -19 supplemental payments 

for properties receiving project-based rental assistance under Section 

8, Section 202, or Section 811 programs - On September 16, 2021, HUD 

issued a housing notice (H 2021-05), which announces the continued 

availability of supplemental operating funds for Section 8, Section 202, and 

Section 811 properties to prevent, prepare for, and respond to COVID-19 

and establishes a revised process for owners of properties assisted under 

these programs to request funds for one or more of these purposes. 

Appropriations provided under the Coronavirus Aid, Relief, and Economic 

Security Act will continue to be provided via a special payment process 

that supplements the amounts currently provided under existing Section 

8, Section 202, and Section 811 rental assistance contracts administered 

by the Office of Multifamily Housing Programs. This notice includes 

important updates to eligibility criteria and the process for awarding 

funds and provides the following changes: adding eligible expenses, 

including certain capitalized building costs recognized to a have direct 

role in mitigating the spread and impact of COVID-19 within multifamily 

properties; updating the formula for standard COVID-19 supplemental 

payments (CSP) funding caps with increases to the base and per-unit 

amounts; establishing a new funding prioritization schedule that features 

a minimum expected funding level for all properties and categorizes 

certain expense categories as higher priorities; and relaxing financial-need 

criteria for smaller standard CSP requests to encourage owner support for 

vaccination efforts and other beneficial expenditures. OIG provided a no 

position response regarding this notice.

28 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
COMMUNITY PLANNING AND DEVELOPMENT

Notice of waivers and alternative requirements for the pilot Recovery 

Housing Program - On July 21, 2021, HUD issued an updated notice 

(FR-6265-N-01), describing program rules, waivers, and alternative 

requirements for the Recovery Housing Program (RHP). The notice made 

the alternative requirements applicable to the Community Development 

Block Grant (CDBG) program published on November 25, 2020, applicable 

to the RHP. The notice also extended the action plan submission date from 

August 16 to December 31, 2021. OIG took no position on this clearance 

item. 

DISASTER FUNDING

Allocations, common application, waivers, and alternative 

requirements for CDBG Disaster Recovery grantees - On June 22, 2021, 

HUD published a notice (FR-6261-N-01) governing the use of $2 billion it 

allocated to enhance or improve the power systems in Puerto Rico and 

the U.S. Virgin Islands. The notice establishes a waiver and alternative 

requirement that creates electrical power system improvements as a 

CDBG Disaster Recovery-eligible activity. The notice also requires the 

grantees to assess the unmet needs for the enhancement or improvement 

of its electrical systems in its action plans. OIG’s noneditorial comments 

recommended that HUD consider (1) documenting in the notice whether 

HUD would evaluate whether the planned improvements were feasible 

and viable and (2) making it a requirement for grantees to facilitate 

receiving complaints via its websites. HUD did not address these 

comments. 

Requirements for the use of funds in the HOME-American Rescue 

Plan program - On September 13, 2021, HUD issued Office of Community 

Planning and Development (CPD) notice CPD-21-10. The notice 

established requirements for the $5 billion appropriated for the HOMEAmerican Rescue Plan. The activities to be performed under the program 

must primarily benefit individuals and families who are homeless, at risk of 

homelessness, or in other vulnerable populations. Activities may include 

(1) development and support of affordable housing, (2) tenant-based 

rental assistance, (3) provision of supportive services, and (4) acquisition 

and development of noncongregate shelter units. OIG had no position on 

this notice. 

ADMINISTRATIVE AND OTHER PROGRAM AREAS

Restoring Affirmatively Furthering Fair Housing Definitions and 

Certifications - On June 23, 2021, HUD issued an interim final notice 

(FR-6249-C-02) to correct errors in a published document. On July 

10, 2021 (86-FR-30779), HUD published its Restoring Affirmatively 

Furthering Fair Housing Definitions and Certifications interim final rule. 

Following publication, the Federal Register alerted HUD to an error in 

the amendatory instruction for revisions to 24 CFR (Code of Federal 

Regulations) 92.508. Specifically, the amendatory instruction directed that 

paragraph (a)(7)(i)(C) be revised; however, the revision being made by the 

interim final rule is to paragraph (a)(7)(i)(B). This document corrects the 

amendatory instructions for 24 CFR 92.508 to reflect the correct paragraph 

being revised. OIG provided a no position response regarding this notice.

29 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
Reinstatement of HUD’s discriminatory effects standard - On June 

25, 2020, HUD issued a proposed rule (FR-6251-P-01), seeking public 

comment. In 2020, HUD published a rule, entitled “HUD’s Implementation 

of the Fair Housing Act’s Disparate Impact Standard” (2020 Rule). Before 

the effective date of the 2020 rule, the U.S. District Court for the District 

of Massachusetts issued a preliminary injunction in Massachusetts Fair 

Housing Center v. HUD, staying HUD’s implementation and enforcement 

of the rule. Consequently, the 2020 Rule never took effect. On January 

26, 2021, President Biden issued a memorandum ordering HUD to “take 

all steps necessary to examine the effects of the [2020 Rule], including 

the effect that amending the [2013 Rule] has had on HUD’s statutory 

duty to ensure compliance with the Fair Housing Act” and “take any 

necessary steps . . . to implement the Fair Housing Act’s requirements 

that HUD administer its programs in a manner that . . . furthers . . . HUD’s 

overall duty to administer the Act... including by preventing practices 

with an unjustified discriminatory effect.” Consistent with the President’s 

memorandum and after reconsidering the 2020 Rule, HUD is proposing to 

recodify its previously promulgated rule, entitled ‘‘Implementation of the 

Fair Housing Act’s Discriminatory Effects Standard” (2013 Rule), which, as 

of the date of publication of this proposed rule, remains in effect due to 

the preliminary injunction. HUD believes the 2013 Rule better states Fair 

Housing Act jurisprudence and is more consistent with the Fair Housing 

Act’s remedial purposes. Comments were due on August 24, 2021. OIG 

provided a no position response regarding this notice. 

Implementing Executive Order 13992, Revocation of Certain Executive 

24 CFR Part 11 Orders Concerning Federal Regulation - On July 6, 

2021, in FR-6192-F-02, HUD published a final rule, removing regulations 

that were created in January. On November 10, 2020, HUD published an 

interim final rule that implemented Executive Order 13891, Promoting 

the Rule of Law Through Improved Agency Guidance Documents, 

requiring Federal agencies to publish regulations to codify processes and 

procedures for issuing guidance documents. Therefore, it created new 

regulations that outlined HUD policy and procedures for issuing guidance 

documents. However, on January 20, 2021, President Biden issued 

Executive Order 13992, Revocation of Certain Executive Orders Concerning 

Federal Regulation, which, among other things, revoked Executive Order 

13891. After considering the public comments HUD received in response 

to its interim final rule and given the revocation of Executive Order 13891, 

this final rule removes 24 CFR part 11, which it created in January. HUD 

concluded that the interim final rule deprives it of necessary flexibility 

to determine when and how to best issue guidance documents, based 

on particular facts and circumstances, and unduly restricts its ability to 

provide timely guidance on which the public can rely. In this final rule, 

HUD also took the opportunity to respond to public comments received 

in response to the interim final rule. This final rule was effective August 5, 

2021. OIG provided minor editorial comments to this final rule.

HUD program evaluation policy - policy statement - On August 13, 

2021, HUD issued a notice (FR-6278-N-01), reaffirming HUD’s commitment 

to conducting rigorous, relevant evaluations and to using evidence 

from evaluations to inform policy and practice. In July 2016, the U.S. 

Government Accountability Office (GAO) issued a report, entitled 

“Department of Housing and Urban Development: Actions Needed to 

Incorporate Key Practices into Management Functions and Program 

Oversight” (GAO 16–497), in which GAO presented a broad assessment of 

HUD’s management of its operations and programs. In the report, GAO 

examined HUD’s efforts to (1) meet Federal requirements and implement 

key practices for management functions, including performance planning 

and reporting and human capital, financial acquisition, and information 

technology management, and (2) oversee and evaluate programs. The 

Office of Policy Development and Research (PD&R) is the primary office 

30 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
within HUD responsible for data analysis, research, program evaluations, 

and policy studies that inform the development and implementation of 

programs and policies across HUD offices. Although PD&R uses a process 

including convening expert panels, GAO found that PD&R had neither 

developed agencywide, written policies for its program evaluations nor 

documented the criteria used to select the expert panels and review 

the quality of program evaluations. On December 6, 2016, HUD issued 

a policy statement in the Federal Register (81-FR-87949) responding to 

the GAO report by setting out the core principles and practices of PD&R’s 

evaluation and research activities. On January 14, 2019, the Foundations 

for Evidence-Based Policymaking Act of 2018 (Evidence Act), Public 

Law 115-435, was enacted. Section 101 of the Evidence Act created 5 

U.S.C. 311–315 and mandated that the head of each agency appoint 

an Evaluation Officer, including at HUD. This officer must establish 

common standards for all HUD evaluations, whether performed by PD&R 

or another office. This issuance articulated departmentwide evaluation 

standards and stated other new principles based on PD&R’s experience 

since the November 2016 publication. Since then, HUD has identified the 

following core principles and practices as fundamental to ensuring highquality and consistent evaluation results: rigor, relevance, transparency, 

independence, ethics, and technical innovation. This policy applies to 

all HUD-sponsored evaluations and regulatory impact analyses. It also 

applies to the selection of projects, contractors, and HUD staff involved in 

evaluations. OIG provided a no position response regarding this notice.

HEALTHCARE

Comprehensive listing of transactional and FHA healthcare facility 

documents for borrowers, lenders, and contractors - On July 6, 2021, 

HUD issued a notice (FR-7038-N-10), which informs the public that it is 

seeking approval from OMB for a revision to an information collection. 

Specifically, HUD is revising the information collection to remove form 

HUD-90011t-ORCF, which was previously approved for use under the 

temporary Operating Loss Loan Section 232-223(d) - COVID program. 

The temporary Operating Loss Loan Section 232/223(d) - COVID program 

expires on August 31, 2021. All other forms currently approved in 

OMB collection 2502-0605 remain unchanged and remain under the 

current expiration cycle of June 31, 2022. The issuance of this notice is 

modeled on the public review and input process that HUD utilized in the 

establishment of the healthcare facility documents for Section 232 of 

the National Housing Act (Section 232) program. OIG provided editorial 

comments on this notice.

Reextension of interim procedures to address site access issues - On 

August 27, 2021, HUD issued ML 21-20, which informs lenders of an 

extension from July 31, 2021, of interim procedures detailed in ML 20-

15, which addressed site access issues related to Section 232 mortgage 

insurance applications during the COVID-19 pandemic. OIG commented 

on this ML that it is more accurate to cite the United States Code as 44 

U.S.C. 3501 et seq. (if the intent was to cite to the Act in full) unless the 

drafter intended to leave out Section 3521.

31 LEGISLATION, REGULATIONS, AND OTHER DIRECTIVES I HUD OIG Semiannual Report to Congress
REPORT 

RESOLUTION

In the report resolution process, Office of Inspector General (OIG) and U.S. 

Department of Housing and Urban Development (HUD) management 

agree upon the actions and timeframes needed for resolving audit 

recommendations. Through this process, OIG strives to achieve measurable 

improvements in HUD programs and operations. The overall responsibility 

for ensuring that the agreed-upon changes are implemented rests with 

HUD managers. This chapter describes audit and evaluation reports issued 

before the start of the period that do not have management decisions, have 

significantly revised management decisions, or have significant management 

decisions with which OIG disagrees. It also has a status report on HUD’s 

implementation of the Federal Financial Management Improvement Act of 

1996 (FFMIA). In addition to this chapter on report resolution, see appendix 

3, table B, “Significant Audit Reports for Which Final Action Had Not Been 

Completed Within 12 Months After the Date of the Inspector General’s Report.”

AUDIT REPORTS ISSUED BEFORE START OF PERIOD WITH NO 

MANAGEMENT DECISION AS OF SEPTEMBER 30, 2021

HUD Did Not Always Provide Adequate Oversight of Property 

Acquisition and Disposition Activities

Issue Date: June 30, 2016

OIG audited HUD’s Community Development Block Grant (CDBG) 

program’s property acquisition and disposition activities. OIG’s objective 

was to determine whether HUD had adequate oversight of property 

acquisition and disposition activities under its CDBG program.

OIG found that HUD did not always provide adequate oversight of 

property acquisition and disposition activities. Specifically, of 14 activities 

reviewed, 7 field offices did not provide adequate oversight of 8 property 

acquisition and disposition activities totaling more than $26.2 million.

The OIG report included a recommendation that the Deputy Assistant 

Secretary for Grant Programs direct field offices to include property 

acquisition and disposition activities as an area of special emphasis 

when assessing grantee risk and establishing their monitoring plans and 

grantee monitoring strategies. The Deputy Assistant Secretary proposed 

a management decision in December 2016. OIG rejected the proposed 

management decision because it did not specifically address directing 

field offices to include property acquisition and disposition activities as 

an area of special emphasis when assessing grantee risk and establishing 

its monitoring plans and grantee-monitoring strategies as recommended. 

OIG requested clarification and documentation from HUD; however, HUD 

did not provide the requested information and documentation, and OIG 

referred this recommendation to the Assistant Secretary for Community 

Planning and Development on March 30, 2017. HUD proposed another 

management decision in April 2017; however, OIG rejected it because 

32 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
it also did not directly address the intent of the recommendation. OIG 

referred this recommendation to the Deputy Secretary on August 23, 2017, 

and as of September 30, 2021, had not received a decision.

Audit Report: 2016-PH-0001

HUD Did Not Always Provide Accurate and Supported 

Certifications of State Disaster Grantee Procurement Processes

Issue Date: September 29, 2016

OIG audited HUD’s controls over its certifications of State disaster 

recovery grantee procurement processes to determine whether HUD’s 

certifications were accurate and supported. OIG found that HUD did not 

always provide accurate and supported certifications of State disaster 

grantee procurement processes and did not have adequate controls 

over the certification process. Due to the weaknesses identified, HUD 

did not have assurance that State grantees had proficient procurement 

processes in place, and the Secretary’s certifications did not meet the 

intent of the Disaster Relief Appropriations Act of 2013.2

 The report 

included five recommendations for the Deputy Assistant Secretary for 

Grant Programs, who in turn proposed corrective actions on January 

11, 2017. OIG rejected the proposed actions on January 27, 2017. OIG 

referred the recommendations to the General Deputy Assistant Secretary 

for Community Planning and Development on February 6, 2017. The 

General Deputy Assistant Secretary responded to the referral on February 

21, 2017. For all of the recommendations, the General Deputy Assistant 

Secretary stated that OIG’s disagreement was closed by the Deputy 

Secretary in her decision regarding resolution of recommendations from 

OIG’s audit of New Jersey’s Sandy Integrated Recovery Operations and 

Management System.3

 The General Deputy Assistant Secretary asserted 

that the legal opinion for the New Jersey audit applied to this audit. Based 

on this information, the General Deputy Assistant Secretary believed 

it was appropriate to close all of the recommendations. OIG disagreed 

with the General Deputy Assistant Secretary’s request to close the 

recommendations in this audit based on the Deputy Secretary’s decision 

to resolve recommendations from OIG’s audit of New Jersey’s Sandy 

Integrated Recovery Operations and Management System. OIG disagreed 

with the Deputy Secretary’s decision to resolve the recommendations 

from that audit. Further, the Deputy Secretary’s decision did not address 

all of the issues with HUD’s process for certifying State disaster grantee 

procurement processes that were identified in the subject audit report. 

OIG referred these recommendations to the Deputy Secretary on March 

31, 2017, and as of September 30, 2021, had not received a decision.

Audit Report: 2016-PH-0005

HUD Needs To Clarify Whether Illegal-Undocumented Aliens 

Are Eligible for Assistance Under the Housing Opportunities for 

Persons With AIDS Program

Issue Date: August 21, 2017

OIG assisted the U.S. Attorney’s Office, Southern District of New York, 

in a civil investigation related to illegal-undocumented aliens receiving 

Housing Opportunities for Persons With AIDS (HOPWA) assistance. 

Noncitizen or alien ineligibility for federally funded programs is a 

recurring issue in Congress. Two laws primarily govern noncitizen or alien 

2

Public Law 113-2, dated January 29, 2013

3

2015-PH-1003, dated June 4, 2015

33 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
eligibility for housing programs: Title IV of the Personal Responsibility 

and Work Opportunity Reconciliation Act of 1996 - 8 U.S.C. (United States 

Code) 1611 (PRWORA) and Section 214 of the Housing and Community 

Development Act of 1980 as amended. PRWORA states that illegal aliens 

do not meet the definition of qualified aliens and as a result, are ineligible 

for Federal public benefits. However, PRWORA exempted certain Federal 

public benefits from the alien eligibility restrictions, and the issue of 

nonqualified aliens receiving assistance under HOPWA or other homeless 

assistance programs has not been clearly addressed in HUD regulations 

and guidance. There is a conflict as to whether “housing assistance” and 

“homeless assistance” are synonymous. OIG recommended that HUD’s 

Office of Community Planning and Development (CPD) (1) clarify whether 

assistance provided under its community development programs, such 

as HOPWA, are considered “Federal public benefits” and are, therefore, 

subject to PRWORA’s noncitizen eligibility restrictions and (2) consult with 

the Office of the Attorney General to establish whether HOPWA and other 

homeless assistance programs are a Federal public benefit that meets the 

definition of “providing assistance for the protection of life or safety” and 

are, therefore, exempt from PRWORA noncitizen eligibility restrictions. 

CPD submitted management decisions for both recommendations on 

December 18, 2017, but the management decisions stated that CPD 

was not able to act on the recommendations, and OIG rejected them. 

This issue was referred to the Assistant Secretary on December 19, 

2017. In January 2018, OIG attempted to meet with HUD regarding the 

recommendations but was unsuccessful. The issue was referred to the 

Deputy Secretary on February 27, 2018. As of September 30, 2021, OIG 

was awaiting a decision from the Deputy Secretary.

Audit Memorandum: 2017-CF-0801

HUD Did Not Provide Sufficient Guidance and Oversight 

To Ensure That State Disaster Grantees Followed Proficient 

Procurement Processes

Issue Date: September 22, 2017

OIG audited HUD’s oversight of disaster grantee procurement processes 

to determine whether HUD provided sufficient guidance and oversight to 

ensure that disaster grantees followed proficient procurement processes 

when purchasing products and services. OIG found that HUD did not 

provide sufficient guidance and oversight to ensure that State disaster 

grantees followed proficient procurement processes. Since HUD agreed 

to correct procurement issues from a previous audit,4

 OIG has issued 17 

audit reports on disaster grantees with questioned costs totaling nearly 

$391.7 million related to procurement. In this audit, OIG made four 

recommendations to the Deputy Assistant Secretary for Grant Programs, 

who in turn proposed corrective actions on November 24, 2017. For two 

of the recommendations, the Deputy Assistant Secretary stated that the 

matter of the applicability of the Federal procurement standards at 2 

CFR (Code of Federal Regulations) 200.318 through 200.3265

 (or 24 CFR 

85.36(b) through (i)) and the requirements of the Federal Register notices 

4

Audit Report 2013-FW-0001, Generally, HUD’s Hurricane Disaster Recovery Program Assisted the Gulf Coast States’ Recovery; However, Some Program Improvements Are Needed, issued March 28, 2013

5

Before December 26, 2014, the relevant procurement requirements were found at 24 CFR 85.36. HUD has since moved its uniform administrative requirements, cost principles, and audit requirements for 

Federal awards to 2 CFR part 200.

34 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
on procurement was closed by the Deputy Secretary in her decision 

regarding resolution of recommendations from OIG’s audit of New Jersey’s 

Sandy Integrated Recovery Operations and Management System.6

 In 

the January 10, 2017, decision, the Deputy Secretary wrote that the 

State certified that its procurement standards were equivalent to the 

standards at 24 CFR 85.36 and HUD had also certified to the proficiency 

of the State’s policies and procedures. The Deputy Assistant Secretary for 

Grant Programs also noted that the Senate Appropriations Committee 

report on fiscal year 2018 U.S. Department of Transportation-HUD 

appropriations legislation7

 addressed this issue. In addition, the Deputy 

Assistant Secretary stated that HUD clarified its definition of proficient 

procurement processes and policies in subsequent Federal Register 

notices that it published for later disasters. Based on this information, 

the Deputy Assistant Secretary believed it was appropriate to close 

these two recommendations. OIG disagreed with the Deputy Assistant 

Secretary’s request to close these two recommendations based on the 

Deputy Secretary’s decision to resolve recommendations from OIG’s audit 

of New Jersey’s Sandy Integrated Recovery Operations and Management 

System and rejected the Deputy Assistant Secretary’s request to close the 

recommendations. OIG also rejected the proposed management decisions 

for the other two recommendations because the proposed actions did 

not address States that chose to certify that their procurement processes 

and standards were equivalent to the Federal procurement standards at 2 

CFR 200.318 through 200.326. OIG referred the recommendations to the 

Assistant Secretary for Community Planning and Development on January 

25, 2018. The Assistant Secretary did not respond. OIG referred these 

recommendations to the Deputy Secretary on March 16, 2018, and as of 

September 30, 2021, had not received a decision.

Audit Report: 2017-PH-0002

HUD Could Improve Its Controls Over the Disposition of 

Properties Assisted With CDBG Funds

Issue Date: September 29, 2017

OIG audited HUD’s oversight of the disposition of real properties assisted 

with CDBG funds. OIG’s objective was to determine whether HUD had 

adequate controls over the disposition of real properties assisted with 

CDBG funds. OIG found that HUD could improve its oversight of the 

disposition of real properties assisted with CDBG funds. Although HUD’s 

drawdown and reporting system allowed grantees to enter identifying 

information for assisted properties and its field offices performed riskbased monitoring of grantees, HUD’s controls were not always sufficient, 

and HUD did not fully implement guidance related to the applicability 

of change of use requirements after voluntary grant reductions. As a 

result, HUD could not track and monitor its interest in the properties 

and did not have assurance that grantees properly handled changes in 

use and properly reported program income. OIG recommended that 

the Deputy Assistant Secretary for Grant Programs develop a process 

to ensure that grantees properly report the addresses of assisted 

properties in HUD’s Integrated Disbursement and Information System 

and properly calculate and report program income from the disposition 

6

2015-PH-1003, dated June 4, 2015

7

Senate Report 1115-138, dated July 27, 2017

35 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
of these properties regularly. The Deputy Assistant Secretary proposed a 

management decision in January 2018, which OIG rejected. OIG referred 

this recommendation to the Assistant Secretary for Community Planning 

and Development on February 6, 2018, and to the Deputy Secretary on 

March 26, 2018. In an attempt to reach agreement, OIG held discussions 

with CPD officials on February 13 and March 8, 2018. On March 28, 2018, 

the Deputy Assistant Secretary for Grant Programs submitted a revised 

proposal; however, OIG rejected HUD’s proposal. In January 2021, OIG 

met with HUD to discuss a possible management decision. On March 

8, 2021, CPD indicated that it was working on an updated proposal that 

would address the concerns discussed. As of September 30, 2021, OIG was 

awaiting an updated proposal from CPD.

Audit Report: 2017-NY-0002

HUD’s Office of Block Grant Assistance Had Not Codified the 

Community Development Block Grant Disaster Recovery 

Program

Issue Date: July 23, 2018

OIG audited the HUD Office of Block Grant Assistance’s (OBGA) CDBG 

Disaster Recovery program (CDBG-DR) and found that although OBGA 

had managed billions in CDBG-DR funds since 2002, it had not codified 

the program, because it did not believe it had the authority to do so. 

However, OBGA’s use of multiple Federal Register notices to operate the 

program presented challenges to the grantees. For example, 59 grantees 

with 112 active CDBG-DR grants, which totaled more than $47.4 billion 

as of September 2017, had to follow requirements contained in 61 

different Federal Register notices to manage the program. In April 2019, 

OBGA acknowledged that issuance of multiple Federal Register notices 

created a compliance burden for CDBG-DR grantees, but it disagreed 

that codification was necessary. OBGA made the following statements to 

support why it will not implement the recommendation: (1) codification is 

not necessary, (2) Federal Register notices are required, and (3) codification 

has limited or no applicability for future disasters. On September 30, 

2019, OIG referred the disagreement and recommendation to the Deputy 

Secretary for resolution and as of September 30, 2021, was awaiting a 

decision.

Audit Report: 2018-FW-0002

The State of New York Did Not Ensure That Properties Purchased 

Under the Acquisition Component of Its Program Were Eligible

Issue Date: March 29, 2019

OIG audited the State of New York’s CDBG-DR-funded New York Rising 

Buyout and Acquisition program. OIG’s objective was to determine 

whether the State ensured that properties purchased under the 

acquisition component of the program met applicable HUD, Federal, 

and State requirements. OIG found that the State did not ensure that 

properties purchased under the acquisition component of its program 

met eligibility requirements. Specifically, it did not ensure that properties 

(1) were substantially damaged and (2) complied with flood hazard 

requirements. Further, it may have improperly purchased properties that 

did not comply with flood insurance requirements. As a result, the State 

disbursed more than $3.5 million for ineligible properties and incentives 

and more than $5.9 million for properties that it could not show met 

applicable requirements, and HUD did not have assurance that CDBGDR funds were used for their intended purpose. OIG recommended 

that HUD require the State to (1) reimburse more than $3.5 million in 

settlement costs and incentives paid for properties that did not meet 

36 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
eligibility requirements or should not have received incentives; (2) provide 

documentation showing that 15 properties met requirements related 

to substantial damage, flood hazards, and flood insurance or reimburse 

more than $5.9 million paid to purchase the properties; and (3) conduct a 

review of the other properties purchased under its program to ensure that 

properties were eligible and reimburse the amount paid for any additional 

properties found to be ineligible. The Principal Deputy Assistant Secretary 

for Community Planning and Development proposed management 

decisions on October 8, 2019. OIG rejected the proposed actions and 

referred the recommendations to the Assistant Secretary for Community 

Planning and Development on September 30, 2020. As of September 30, 

2021, CPD was working to update its proposed management decisions in 

conjunction with its work related to audit report 2019-NY-1002. OIG will 

continue to communicate with CPD to attempt to reach an agreement. 

If OIG is unable to reach an agreement with CPD, OIG will refer the 

recommendations to the Deputy Secretary for a decision.

Audit Report: 2019-NY-1001

The State of New York Did Not Ensure That Appraised Values 

Used by Its Program Were Supported and Appraisal Costs and 

Services Complied With Requirements

Issue Date: May 29, 2019

OIG audited the State of New York’s CDBG-DR-funded New York Rising 

Buyout and Acquisition program. OIG’s objectives were to determine 

whether the State ensured that (1) the appraised fair market values used 

to determine award amounts under its program were supported and (2) 

appraisal costs for its program complied with applicable requirements 

and were for services performed in accordance with Federal, State, and 

industry standards. OIG found that HUD and the State did not have 

assurance that (1) more than $367.3 million paid to purchase properties 

was supported; (2) more than $3.4 million disbursed for appraisal 

services was for costs that were reasonable, necessary, and adequately 

documented; and (3) appraisal services were properly procured and 

performed. OIG provided 10 recommendations to the State to provide 

support for appraised fair market values, appraisal prices, and other 

expenses related to more than $370 million in unsupported costs and 

to improve controls over its program, which can ensure that up to $93.4 

million not yet disbursed is put to better use. The Deputy Assistant 

Secretary for Grant Programs did not propose management decisions to 

address the 10 recommendations contained in the audit report. OIG held 

discussions with CPD officials on June 17, September 10, and September 

24, 2019, but did not reach an agreement. As a result, OIG referred the 

10 recommendations to the Assistant Secretary for Community Planning 

and Development on October 3, 2019, and held a discussion with CPD 

officials on November 21, 2019, but when agreement was not reached, OIG 

referred the recommendations to the Deputy Secretary on February 20, 

2020. In June 2021, OIG provided CPD with requested documentation to 

assist with preparation of the management decisions. As of September 30, 

2021, OIG was awaiting a decision while continuing to work with CPD.

Audit Report: 2019-NY-1002

37 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
HUD Paid Rental Subsidies To Benefit Public Housing and 

Voucher Tenants Reported as Excluded From Federal Programs 

or Deceased

Issue Date: June 25, 2019

OIG performed an audit to determine whether HUD provided public 

housing agencies (PHA) with access to the information contained in the Do 

Not Pay system. Do Not Pay is a collection of data sources, one of which 

is the General Services Administration’s System for Award Management 

(SAM) database of excluded parties. OIG found that HUD paid potentially 

improper rental subsidies to benefit 1,550 tenants who were reported 

as excluded from Federal programs. OIG recommended that HUD issue 

guidance to PHAs to ensure that any applicant for or tenant of public or 

assisted housing whose name appears on the SAM excluded parties list 

is reviewed by PHAs to determine eligibility in a manner consistent with 

the regulations in 2 CFR parts 180 and 2424 so that ineligible applicants 

or tenants are not admitted or recertified to put up to an estimated $13.7 

million in annual rental subsidies to better use. In its October 8, 2019, 

management decision, the Office of Public and Indian Housing (PIH) 

disagreed with this recommendation and submitted a legal opinion 

from HUD’s Office of General Counsel (OGC) in support of its position. 

OIG rejected this management decision because it does not resolve the 

recommendation, and OIG continues to recommend that HUD issue 

guidance to PHAs to ensure that any applicant for or tenant of public or 

assisted housing whose name appears on the SAM excluded parties list 

is reviewed by PHAs to determine eligibility. Because OIG did not reach 

agreement with the Deputy Assistant Secretary for Public Housing and 

Voucher Programs, on February 19, 2020, OIG referred its disagreement to 

the Assistant Secretary for Public and Indian Housing. However, OIG did 

not reach agreement with the Assistant Secretary on the corrective actions 

identified in the report. Therefore, OIG referred the recommendation to 

the official serving as Deputy Secretary on March 31, 2020, for his final 

decision as the Departmental Audit Resolution Official. HUD began 

scheduling regular meetings with OIG during 2021 to attempt to reach 

a resolution; however, OIG had not met with HUD on this topic since 

February 2021. As of September 30, 2021, OIG had not received a decision 

from the Deputy Secretary.

Audit Report: 2019-KC-0002

EVALUATION REPORTS ISSUED BEFORE START OF PERIOD WITH NO 

MANAGEMENT DECISION AS OF SEPTEMBER 30, 2021

Risk-Based Enforcement Could Improve Program Effectiveness

Issue Date: February 12, 2016

OIG evaluated the effectiveness of the Departmental Enforcement Center 

(DEC). Historically, HUD program managers have not wanted to enforce 

program requirements. That reluctance increases the risk that program 

funds will not provide maximum benefits to recipients and allows 

serious noncompliances to go unchecked. When it was created, DEC 

had independent enforcement authority, but it lost that authority when 

it moved from the Deputy Secretary’s office to OGC. DEC lost control of 

funding and staffing levels and contended with inadequate information 

technology (IT) systems and support. Although program offices asked for 

more DEC financial analyses, they did not consistently use enforcement 

actions to remedy noncompliances. Further, managers’ reluctance 

to enforce program requirements limited DEC’s effectiveness in most 

programs. OIG concluded that turnover, retirements, and hiring limitations 

could leave DEC without enough skilled staff to support future workloads 

needed to service HUD programs and enforce program requirements. 

Risk-based monitoring and enforcement offers the opportunity to 

38 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
provide quality, affordable rental housing, improve the quality of life, and 

build strong, resilient communities. OIG made eight recommendations, 

one of which remains open. OIG has not reached an agreed-upon 

management decision for this recommendation. The remaining open 

recommendation states that HUD needs to strengthen DEC’s authority to 

enforce program requirements. In April 2019, OIG changed the status of 

this recommendation to resolved-open based on HUD’s proposed actions 

in response to a U.S. Government Accountability Office (GAO) report. 

However, after reviewing the protocols developed between the DEC and 

PIH, OIG determined that the protocol does not strengthen DEC’s authority 

to enforce program requirements or include any provisions for DEC to 

make independent assessments. Therefore, OIG changed the status of this 

recommendation to unresolved-open. On March 31, 2020, OIG referred 

this recommendation to the Deputy Secretary for final action and was 

awaiting a response from the Deputy Secretary on the final action.

Evaluation Report: 2014-OE-0002

Opportunities for Improvement Within CPD’s Risk Management 

Process for Hurricane Sandy Grants

Issue Date: March 29, 2017

OIG evaluated the risk analysis process for Hurricane Sandy grants 

performed by CPD. CPD uses a risk analysis process to rank grantees 

that pose the greatest risk to the integrity of its programs. According to 

CPD, the risk analysis results guide how the monitoring phase of the risk 

management process is conducted. After CPD management certifies the 

risk analysis results, management develops a monitoring strategy. By 

monitoring grantees, CPD aims to ensure that a grantee performs and 

delivers on the terms of the grant while reducing the possibility of fraud, 

waste, and mismanagement. OIG observed that (1) CPD’s risk analysis 

worksheet did not consider risk related to performance outputs, (2) the 

risk analysis did not consider the likelihood of risk events occurring, (3) 

no clear correlation between the risk analysis and monitoring existed, (4) 

CPD made limited use of data analytics in its risk management process, 

and (5) CPD staff was not trained to conduct a risk analysis. OIG made five 

recommendations, one of which remained open. OIG had not reached 

an agreed-upon management decision for this recommendation. To 

address this recommendation, CPD must update the risk analysis guidance 

for CDBG-DR grants, to include the assessment of the likelihood of risk 

occurrence. On March 9, 2021, CPD provided an updated risk analysis tool 

and accompanying instructions. On April 21, 2021, OIG held a meeting 

with CPD officials to learn more about the tool and instructions and 

determined that the tool did not consider the likelihood of risk occurrence. 

The Deputy Secretary for Community Planning and Development 

questioned the necessity of including the likelihood of risk occurrence in 

the risk analysis tool and said that the requirements for the risk analysis 

should be limited to the requirements outlined in 2 CFR part 200. As 

discussed in OIG’s report, HUD’s Departmental Management Control 

Handbook 1840.1 – chapter 2 (revision 3) and Office of Management and 

Budget (OMB) Circular A-123 both require that likelihood be considered 

when assessing risk. Therefore, the risk analysis tool remained out of 

compliance with the Handbook and OMB Circular A-123. On August 13, 

2021, OIG referred the recommendation to the Deputy Secretary for final 

action. OIG was awaiting a response from the Deputy Secretary on the 

final action.

Evaluation Report: 2016-OE-0004S 

39 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
HUD Web Application Security Evaluation

Issue Date: June 6, 2018

OIG completed a targeted web application security evaluation of HUD 

in support of a Counsel of the Inspectors General on Integrity and 

Efficiency Federal cross-cutting project, making nine recommendations 

for improvement to HUD. OIG assessed HUD’s capability to identify and 

mitigate critical IT vulnerabilities in its publicly accessible web applications. 

OIG identified key deficiencies in HUD’s practices that put its extensive 

collection of sensitive data, including personal information of private 

citizens, at increased risk of unauthorized access and compromise. 

Of particular concern was the discovery of multiple operating web 

applications unknown to the Office of the Chief Information Officer 

(OCIO). On June 2, 2017, HUD concurred with all recommendations and 

agreed to work with OIG to assign responsibility and complete resolution. 

OIG agreed to close five recommendations based on HUD OCIO closure 

requests and associated evidence during the previous semiannual period, 

leaving four open recommendations. HUD lacked management decisions 

for these four recommendations.

Evaluation Report: 2016-OE-0002

HUD Has Not Referred Troubled Public Housing Agencies as the 

Law and Regulations Require

Issue Date: February 4, 2020

OIG evaluated whether PIH refers troubled PHAs as the law and regulations 

require. PIH is responsible for monitoring the performance of PHAs, 

including those that are troubled. A troubled PHA should be given a 

maximum of 2 years to cure its negative conditions. If the PHA does not 

meet the 1- or 2-year recovery requirements, law and regulations require 

PIH to refer the PHA to the Assistant Secretary for Public and Indian 

Housing for action. PIH had not referred troubled PHAs to the Assistant 

Secretary to take them over as the law and regulations require. Without 

this referral mechanism, a PHA could remain troubled for an indefinite 

period, while conditions stagnate or deteriorate. OIG identified 18 PHAs 

that remained troubled for more than 2 years without being referred. 

PIH is creating a process for referring troubled PHAs, but two problems 

exist with its approach. First, the draft process that OIG reviewed in this 

evaluation would provide more options to the Assistant Secretary than 

the law and regulations allow. Second, PIH cannot meet the statutory 

deadlines for referral of a troubled PHA without substantial changes to the 

assessment process or changes to the law and regulations, which PIH is 

not making as part of its new process. The new process would allow some 

troubled PHAs more time to recover than the law and regulations allow. 

PIH’s training that existed at the time of OIG’s fieldwork on the authority 

and process for declaring a PHA in substantial default and for taking PHAs 

into possession suggests remedies that do not fully comply with the law 

and regulations. Finally, PIH had not submitted an annual troubled PHAs 

report to Congress for at least 11 years as the law requires, thereby missing 

another opportunity to strengthen the accountability and transparency 

of its recovery process. OIG made five recommendations, three of which 

remain open. OIG had not reached an agreed-upon management decision 

for these three recommendations. For one of these recommendations, PIH 

should ensure that referrals of troubled PHAs to the Assistant Secretary 

for Public and Indian Housing recommend only the recovery options 

allowed by the law and regulations, specifically with those outlined in 42 

40 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
U.S.C. 1437d(j)(3)(B)(ii)(III). For the other two, PIH should use the referral 

protocol to update and provide training to staff on these recovery options. 

On September 15, 2020, PIH provided proposed management decisions 

for these recommendations and a legal opinion that program counsel 

issued after OIG issued its report. After reviewing these documents, OIG 

determined that PIH’s referral procedures and their implementing training 

meant to satisfy the recommendation allow more recovery options than 

specified in law. Specifically, they do not recommend that the Assistant 

Secretary for Public and Indian Housing take the recovery options 

identified in 42 U.S.C. 1437d(j)(3)(B)(ii)(III) when a troubled PHA fails to 

meet the 1- or 2-year recovery requirements. Instead, PIH’s Office of Field 

Operations’ internal procedures allow the Assistant Secretary to take the 

recovery options identified in 42 U.S.C. 1437d(j)(3)(A) when a troubled 

PHA’s substantial default status is not solely based on a failure to meet 

the 1- or 2-year recovery requirements. As a result of this interpretation, 

OIG remained concerned that troubled PHAs would remain troubled for 

an indefinite period, while living conditions for residents stagnated or 

deteriorated.

Evaluation Report: 2019-OE-0001 

HUD IT System Management and Oversight of the Section 184 

Program

Issue Date: August 13, 2018

OIG evaluated the IT systems supporting the Office of Native American 

Programs’ (ONAP) Indian Home Loan Guarantee Program (Section 184 

program), following concerns that HUD had not used provided resources 

to address shortcomings in internal controls and the ability to deploy a 

reliable IT system. OIG observed that (1) a newly developed IT system, 

called the Loan Origination System (LOS), had significant limitations, 

requiring lenders and program officials to continue to use a HUD legacy 

IT system and manual processes for maintaining files, servicing loans, and 

managing claims; (2) only 1 of 38 lenders was able to access and use LOS 

due to HUD’s inability to resolve and implement a user access solution; (3) 

LOS had no capability to conduct loan servicing and claims processing, 

which were still conducted using Excel spreadsheets; and (4) LOS lacked 

critical management reporting capabilities. Despite HUD’s investing 

$4 million into the development of LOS, the system did not satisfy all 

management and oversight objectives. OIG made five recommendations. 

HUD and ONAP concurred with all five recommendations in August 2018 

with a suspense of November 26, 2018, to provide OIG with management 

decisions. In addition, two recommendations were closed during the 

previous semiannual period due to the progress of OCIO’s implementing 

electronic document capabilities and resolving the lender access issue 

using the Federal Housing Administration (FHA) Catalyst IT system. Three 

recommendations remained open, with HUD providing closure requests 

for all three.

Evaluation Report: 2018-OE-0004

41 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
SIGNIFICANTLY REVISED MANAGEMENT DECISIONS

Section 5(a)(11) of the Inspector General Act, as amended, requires that 

OIG report information concerning the reasons for any significantly revised 

management decisions made during the reporting period.

During the current reporting period, there were six audit reports with 

significantly revised management decisions.

OFFICE OF AUDIT

The Housing Authority of the City of Tupelo, Housing Programs 

Operations, Tupelo, MS

Issue Date: July 3, 2002

Due to HUD’s concerns with the Housing Authority of the City of Tupelo’s 

questionable financial condition and its involvement with a limited 

partnership, OIG completed an audit of the Authority’s operations. OIG’s 

objectives were to determine whether the Authority was operating 

its housing activities in accordance with HUD requirements and had 

established controls to ensure effective and efficient administration 

of program funds. OIG determined that the Authority (1) improperly 

advanced public housing program funds for non-Federal development 

activities, (2) did not maintain its conventional low-income housing in 

good repair and condition, (3) did not spend its Comprehensive Grant 

Program funds as approved, (4) inappropriately pledged its assets as 

collateral for loans, and (5) did not adequately control its appliance 

inventory. OIG issued 16 recommendations, 4 of which disallowed certain 

costs. Upon the request of the HUD’s Assistant Secretary for Public and 

Indian Housing, HUD’s Deputy Secretary approved forgiveness of the 

disallowed cost in four recommendations, given the unique situation. 

Specifically, the entity responsible for repaying the Authority for the cost 

questioned filed for bankruptcy and was out of business with no assets 

available from which to recover any amounts due. OIG concurred with 

the Deputy Secretary’s approval. Therefore, $670,245 in outstanding 

balances was written off for recommendations 1A and 5C, and the 

recommendations were closed.

Audit Report: 2002-AT-1002

The Housing Authority of the City of Cuthbert, Public Housing 

Activities, Cuthbert, GA

Issue Date: January 15, 2004

In accordance with OIG’s priority of providing oversight of PHA activities 

with related nonprofit entities, OIG completed a review of the Housing 

Authority of the City of Cuthbert’s activities with its related nonprofit 

organization, Southwest Georgia Housing Development Corporation 

(SGHDC). OIG found that the Authority inappropriately advanced funds 

and pledged assets for non-Federal development activities. The Authority 

improperly advanced $792,802 in low-income housing funds to SGHDC 

to pay its development expenses, which reduced program funds available 

for the Authority’s operating expenses. The Authority also pledged assets 

inappropriately when it guaranteed repayment of two SGHDC loans 

totaling $690,050. SGHDC had reimbursed the Authority all but $327,326. 

In recommendation 1A, OIG recommended that the Authority collect the 

42 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
outstanding $327,326 from SGHDC. However, HUD informed OIG that 

after making some payments, the entity responsible for repaying the funds 

filed bankruptcy and the Authority did not have the non-Federal funds to 

repay the cost on its own. Therefore, HUD requested that the remaining 

outstanding cost totaling $199,851 be recorded as uncollectable. OIG 

concurred with HUD, wrote off $199,851 for recommendation 1A, and 

closed the recommendation accordingly.

Audit Report: 2004-AT-1001

Violations Increased the Cost of Housing’s Administration of Its 

Bond Refund Program

Issue Date: March 14, 2014

OIG audited HUD’s McKinney Act bond refund program with the objectives 

of determining whether HUD properly enforced requirements that 

regulated the application of automatic adjustment factors to Section 

8 rents for projects that had bond refund savings to prevent excessive 

rents and whether adjustments to receivables due to HUD from bond 

refunds were properly supported. There were violations relative to HUD’s 

calculation of rents using automatic annual adjustment factors for bondrefunded projects and justification and support for writeoffs of receivables 

due to HUD from bond refunds. Specifically, HUD paid more than $2.6 

million in excessive Section 8 rents due to a pattern of violations, which 

would indicate the existence of excess rents beyond those of the projects 

reviewed during the audit, similar to the violations reported in past 

reviews. More than $2.7 million in questionable writeoffs of receivables 

due to HUD for bond refund savings were also identified. The amount 

included more than $2.6 million, which HUD wrote off without proper 

justification, and more than $139,000, for which HUD could not locate or 

provide proper documentation to show whether the writeoff was justified 

and supported. OIG also identified the release of more than $143,300 

in trust fund balances to entities outside HUD without proper support. 

These conditions occurred primarily because the Office of Housing had 

not developed and implemented adequate monitoring of the bond refund 

program to ensure compliance with requirements. To fix these issues, OIG 

made eight recommendations (1A through 1H) to the Deputy Assistant 

Secretary for Multifamily Housing. Specifically, for recommendations 

1A through 1G, OIG recommended that the Deputy Assistant Secretary 

develop and implement procedures for (1) monitoring the calculation 

of annual rent increases for Section 8 projects and the remittance of 

trust fund balances and (2) ensuring that requests made by Housing for 

adjustments to bond receivables are in accordance with requirements. In 

addition, OIG recommended that the Deputy Assistant Secretary initiate 

actions needed to ensure the enforcement of program requirements and 

the proper resolution of more than $2.7 million in questioned costs. On 

April 15, 2021, the Office of Multifamily Housing Programs submitted 

revised management decisions and provided for its basis that there were 

only two active bond transactions, which are scheduled to end in 2024 

and 2025. Both transactions are current and are being managed by the 

Accounting, Monitoring, and Analysis Division (AMAD) team within HUD’s 

Office of the Chief Financial Officer (OCFO). Regular meetings are taking 

place to ensure that these two transactions are being managed and 

monitored in accordance with AMAD’s standard operating procedures. 

After the two remaining active bond transactions are paid off, this program 

will no longer exist. In addition, the costs are uncollectable since the 

43 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
statute of limitations has passed. Therefore, Multifamily requested that 

recommendations 1A through 1G to be closed. On April 19 and May 3, 

2021, OIG agreed with the revised management decisions and closed 

these recommendations.

Audit Report: 2014-AT-0001

HUD Did Not Always Recover FHA Single-Family Indemnification 

Losses and Ensure That Indemnification Agreements Were 

Extended

Issue Date: August 8, 2014

OIG audited HUD’s controls over its FHA loan indemnification recovery 

process to determine whether HUD had adequate controls in place to 

monitor indemnification agreements and recover losses on FHA singlefamily loans. OIG determined HUD did not always bill lenders for FHA 

single-family loans that had an indemnification agreement and a loss to 

HUD. Specifically, it did not bill lenders for any loans that were part of the 

Accelerated Claims Disposition program or the Claims Without Conveyance 

of Title program or loans that went into default before the indemnification 

agreement expired but were not in default on the expiration date. There 

were a total of 486 loans from January 2004 to February 2014 that had 

enforceable indemnification agreements and losses to HUD but were not 

billed. As a result, HUD did not attempt to recover a loss of $37.1 million 

for 486 loans that had enforceable indemnification agreements. During 

the audit, OIG made five recommendations, three of which were referred 

to the Deputy Secretary on March 31, 2015, because OIG could not 

agree on a management decision. The disagreement centered on OIG’s 

determination that the Offices of Single Family Housing and Finance and 

Budget did not follow the plain language explicitly stated in the signed 

indemnification agreements. The Offices of Single Family Housing and 

Finance and Budget disagreed with OIG’s determination that HUD should 

have billed lenders for FHA loans that either were in default or went into 

default during the indemnification agreement period. For two of the 

recommendations, a management decision was reached. HUD agreed 

with the OIG recommendations to review and initiate the billing process 

for the loans in question. In implementing these corrective actions, HUD 

determined that certain loans were not billable due to its position that 

it billed lenders in a manner consistent with a longstanding HUD policy 

that emphasized the definition of the “date of default.” OIG disagreed 

and determined that HUD should have billed lenders for FHA loans that 

either were in default or went into default during the indemnification 

agreement period. Due to the lack of action from the office of the Deputy 

Secretary to render a decision, the 6-year statute of limitations (28 U.S.C. 

2415) rendered every loan under disagreement as time barred and not 

billable, impacting all five recommendations. During this reporting period, 

HUD significantly revised its final open management decision as HUD 

completed billing actions for 237 questioned loans. Despite not reaching 

agreement on enforcement of the loans and indemnification agreements 

in question, OIG concurred with the revised management decision. HUD 

billed lenders for 210 loans that it determined to be billable. Further, 26 

of the remaining 27 loans were deemed not billable. One loan remains 

active and is performing under a repayment plan that will satisfy the 

outstanding debt in October 2025. OIG’s concurrence relied solely on 

the statute of limitations and does not constitute agreement with HUD’s 

position regarding the date of default, enforcement of the indemnification 

agreements in question, or the billable loans. The revised management 

decision questioned more than $22.4 million. To date, OIG has sustained 

44 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
more than $15.7 million, and more than $6.4 million in collections was 

determined to be uncollectible. Recoveries for the final loan under 

repayment will be posted and reported as sustained as payments are 

received.

Audit Report: 2014-LA-0005

Berkadia Approved a Mortgage for the Temtor Project That Was 

Not Economically Sound

Issue Date: August 4, 2015

OIG audited Berkadia Mortgage, LLC’s underwriting of the loan to fund 

the renovation of the Temtor project in St. Louis, MO. OIG found that 

Berkadia did not properly determine the maximum mortgage amount 

for the Temtor loan. It included ineligible and unsupported items, 

which increased the HUD-insured mortgage by more than $6 million. 

Specifically, Berkadia included (1) projected commercial rents without 

establishing the market rate and (2) tax increment financing payments that 

were not guaranteed. The project’s actual income was insufficient to pay 

the larger mortgage. The owners defaulted on the loan beginning with 

the first payment after final endorsement, leading to submission of a claim 

to HUD. OIG recommended that HUD refer Berkadia to the Mortgagee 

Review Board (MRB) for appropriate action for violations that caused a 

more than $11 million loss to HUD’s FHA insurance fund. In its original 

management decision, HUD requested that the decision be suspended 

due to actions taking place outside of HUD’s control, with a plan to submit 

a revised management decision pending the results of these actions. On 

August 23, 2021, HUD submitted a revised recommendation, which stated 

that although there were underwriting deficiencies, no fraud or material 

acts of negligence were identified. Further, HUD’s experience has shown 

that it would not be successful in this case if it were to be referred to the 

MRB. On September 7, 2021, OIG agreed with the revised management 

decision.

Audit Report: 2015-KC-1005

HUD Did Not Adequately Administer Its Housing Counseling 

Program

Issue Date: September 24, 2018

OIG audited HUD’s Housing Counseling Program, located within the 

Office of Housing Counseling, to determine whether HUD adequately 

administered its program. OIG determined that HUD did not adequately 

administer its program in accordance with Federal regulations and its 

requirements because HUD did not have adequate controls over its 

program due to weaknesses in its Housing Counseling System. One 

recommendation OIG made was for HUD to ensure that its new Housing 

Counseling Agency Management System (HCAMS) has the ability to 

adequately oversee the work of its staff and track important housing 

counseling agency milestones, including HUD’s approval of expirations 

and required terminations. In its original management decision, HUD 

agreed with the recommendation and stated that it would implement 

version 1.0 of HCAMS with the ability to adequately oversee the work of its 

staff and track important housing counseling agency milestones by March 

31, 2021. On March 10, 2021, HUD submitted a revised management 

decision, stating that the HCAMS project was approximately 66 percent 

complete and that due to funding restraints, it had not been able to 

complete development and implementation of the system. HUD planned 

to reevaluate whether to continue the development and implementation 

of HCAMS in fiscal year 2022. In the meantime, HUD implemented interim 

45 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
controls within its existing systems to address OIG’s concerns, including 

more involvement by management in tracking each performance review 

and creating spreadsheets to track its important milestone dates. On 

March 11, 2021, OIG agreed with the revised management decision. As 

it became evident that near future funding for the HCAMS project was 

unlikely, HUD discontinued its development of the system and focused on 

making the interim controls permanent and part of its regular processes 

to address the spirit of the recommendation. On September 16, 2021, 

HUD submitted another revised management decision to reflect this 

change and updated its standard operating procedures to include 

additional controls, such as management’s maintaining a master tracking 

spreadsheet and increased communication among staff, management, 

and senior leadership. As a result of its newly implemented controls, HUD 

stated that it had cleared its backlog of performance reviews and met its 

performance review goals for fiscal years 2020 and 2021. On September 

16, 2021, OIG agreed with the revised management decision and closed 

the recommendation.

Audit Report: 2018-NY-0001

SIGNIFICANT MANAGEMENT DECISION WITH WHICH OIG 

DISAGREES

Section 5(a)(12) of the Inspector General Act, as amended, requires that OIG 

report information concerning any significant management decision with 

which OIG disagrees. 

During the reporting period, there was one audit report in which OIG 

disagreed with the significant management decisions.

HUD Failed To Follow Departmental Clearance Protocols for FHA 

Programs, Policies, and Operations

Issue Date: January 25, 2017

OIG audited HUD FHA’s process for making changes to its programs, 

policies, and operations based on an OIG preaudit analysis that noted 

potential violations of departmental clearance requirements. OIG 

determined that HUD failed to follow required departmental clearance 

procedures when implementing changes to FHA programs. Specifically, 

HUD’s Office of Single Family Housing did not always pursue the required 

departmental clearance and posted draft documents or directives in 

final form before departmental clearance. When departmental clearance 

was pursued, HUD did not always ensure that key officials reviewed the 

documents before issuance. As a result, significant policy information 

was distributed without proper review and clearance, which undermined 

the intent and integrity of the process. This action effectively bypassed 

the required review by other HUD offices, including OIG, which had 

questioned or opposed document policies in some cases. As a result 

of the audit, OIG made 6 recommendations, 1 of which recommended 

that HUD pursue departmental clearance for the 13 documents and 

46 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
policies identified that did not go through the required departmental 

clearance and recall any documents that cannot be appropriately 

cleared. HUD agreed with OIG and processed 7 of the 13 documents 

through the departmental clearance process. HUD found that 5 of the 

13 documents had been superseded by another policy that had gone 

through departmental clearance and thereby negated the need to submit 

the original document through departmental clearance. HUD submitted 

a revised management decision on July 5, 2018; however, OIG rejected 

the revision due to disagreement regarding the final document that did 

not go through departmental clearance, a HUD OGC legal opinion letter 

on downpayment assistance. OGC stated that it is the chief legal officer of 

HUD and has full authority to interpret laws, regulations, and requirements 

applicable to HUD’s programs and found that it was not appropriate for 

these opinions to be reviewed and concurred on by any individuals not 

specifically employed as counsel to HUD. OIG’s Office of Legal Counsel 

generally agreed that legal opinions are generally not policy documents; 

they articulate legal interpretations on which policy decisions are based, or 

they assess the legality of particular fact situations. A possible exception 

was the 2015 HUD OGC legal opinion regarding downpayment assistance 

and housing finance agencies, as it was used not only to arrive at a legal 

conclusion but also to arguably publicize the resulting policy. HUD and 

OIG conducted several meetings to reach an agreement to close the 

recommendation. However, the disagreement was not resolved. OIG met 

with HUD OCFO’s audit resolution team on May 27, 2021, to discuss the 

open audit recommendation. During the meeting, it was agreed to close 

the recommendation with OIG’s disagreement because HUD’s Office of 

Single Family Housing had adequately resolved the documents that were 

under its control. The recommendation was closed on June 11, 2021, 

with disagreement. OIG’s position has not changed. According to HUD’s 

Directives Handbook, “...what constitutes a directive is not necessarily the 

title of a specific type of communication, but the content.” Accordingly, 

although the formatting of the HUD OGC opinion on downpayment 

assistance was as a legal interpretation addressed to an internal HUD 

official, once it was publicly posted with intended precedential effect with 

general applicability for all lenders, it changed the nature of this document 

from an internal advisory document to a public communication. The 

handbook states that the content of a document, rather than the title, 

determines whether it constitutes a directive. It also states that public 

communications constitute directives when they relay guidance for 

the first time, beyond merely explaining provisions of existing policy or 

requirements. Existing statutory requirements in paragraph 203(b)(9)(c) of 

the National Housing Act prohibit gifts (to meet FHA’s minimum required 

investment) that involve direct or indirect reimbursement from an entity 

that financially benefits from the transaction. Without departmental 

clearance in this case, there were no checks and balances in place to 

ensure that legal, regulatory, or policy concerns with the statements were 

addressed internally. Further, because OIG, a required reviewing office for 

departmental clearance, indicated disagreement with the subject policy, 

HUD should have pursued required resolution procedures for reviewing 

office nonconcurrence outlined in HUD’s directives handbook before 

issuing this document.

Audit Report: 2017-LA-0002

47 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
FEDERAL FINANCIAL MANAGEMENT IMPROVEMENT ACT OF 1996

Section 803(a) of FFMIA requires that each agency establish and maintain 

financial management systems that comply with (1) Federal financial 

management system requirements, (2) Federal accounting standards, and 

(3) the United States Standard General Ledger at the transaction level. 

Section 803(c) of FFMIA requires an agency to establish a remediation plan 

if it is determined that the agency’s financial management systems do not 

comply with the requirements of section 803(a). Section 804(b) of FFMIA 

requires OIG to report in its Semiannual Reports to Congress instances 

and reasons when an agency has not met the intermediate target dates 

established in its remediation plans.

As of September 30, 2021, OIG and HUD identified noncompliance with 

the three Section 803(a) elements of FFMIA. Specifically, there were 

two financial systems8

 that were noncompliant with one or more of the 

three Section 803(a) requirements. Remediation activities for one of 

these systems are expected to be completed during fiscal year 2022. 

Remediation activities for the second system is dependent on receipt of an 

opinion from GAO, which is expected during fiscal year 2022. HUD was on 

track to meet the intermediate target dates in its remediation plans as of 

September 30, 2021. 

8

The two financial systems that were noncompliant with FFMIA as of September 30, 2021, were the Disaster Recovery Grant Reporting System and the Tenant Rental Assistance Certification System.

48 REPORT RESOLUTION I HUD OIG Semiannual Report to Congress
WHISTLEBLOWER PROTECTION COORDINATOR

Whistleblowers play a critical role in keeping our Government programs honest, efficient, and accountable. The U.S. Department of Housing and Urban 

Development (HUD), Office of Inspector General (OIG), continues to ensure that HUD and OIG employees are aware of their rights to disclose misconduct, waste, 

or abuse in HUD programs without reprisal and to assist HUD and OIG employees in seeking redress when employees believe that they have been subject to 

retaliation for whistleblowing. OIG also investigates complaints of whistleblower retaliation by Government contractors and grantees.

49 WHISTLEBLOWER OMBUDSMAN I HUD OIG Semiannual Report to Congress

9

Not all complainants are found to be whistleblowers under Section 4712. For example, many complainants raise questions regarding treatment by public housing agencies (PHA) following their alleged 

disclosures of wrongdoing by the same PHA. They claim to be whistleblowers, but they are not employees of the grantee. These complaints are referred to OIG’s hotline for appropriate referral and 

disposition.
OIG’s Whistleblower Protection Coordinator Program works with HUD and 

OIG employees to provide information on

• employee options for disclosing misconduct, waste, or abuse in HUD 

programs; 

• statutory protections for Federal employees who make such 

disclosures; and 

• how to file a complaint under the Whistleblower Protection Act 

when an employee believes he or she has been retaliated against for 

making protected disclosures.

The OIG Whistleblower Protection Coordinator Program continued 

its focus on staff training and individual assistance. The mandatory 

whistleblower training is presented in conjunction with the OIG annual 

ethics training. The 2020 training was presented on September 18, 

2020, via a memorandum from the Inspector General, which explained 

employees’ rights to make disclosures of wrongdoing, free from retaliation. 

The memorandum also provided information about other prohibited 

personnel practices.

In October 2017, Congress enacted the Dr. Chris Kirkpatrick Whistleblower 

Protection Act of 2017, which contains new training and performance 

standards for supervisors regarding handling of whistleblowers. HUD OIG 

is in the process of implementing these requirements.

The Whistleblower Protection Coordinator meets with HUD employees 

individually, upon request. Generally, OIG will refer HUD employees with 

whistleblower retaliation complaints to the Office of Special Counsel. 

OIG received several complaints filed under 41 U.S.C (United States 

Code) 4712. In December 2016, Congress passed the Enhancement of 

Whistleblower Protection Act. It made the whistleblower protections 

under 41 U.S.C. 4712 permanent. Section 4712 extends whistleblower 

protection to employees of Federal contractors, subcontractors, grantees, 

and subgrantees. If the employee of a HUD grantee or contractor believes 

he or she has been retaliated against for whistleblowing, he or she may file 

a complaint with OIG, and OIG will investigate the complaint and provide 

findings of fact to HUD.

50 WHISTLEBLOWER OMBUDSMAN I HUD OIG Semiannual Report to Congress
PEER REVIEW 

REPORTING

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Public 

Law No. 111-203), section 989C, requires inspectors general to report the 

latest peer review results in their semiannual reports to Congress. The 

purpose in doing so is to enhance transparency within the government. 

The Offices of Audit, Investigation, and Evaluation are required to undergo 

a peer review of their individual organizations every 3 years. The purpose 

of the review is to ensure that the work completed by the respective 

organizations meets the applicable requirements and standards. The 

following is a summary of the status of the latest round of peer reviews for 

the organization.

OFFICE OF AUDIT

Peer Review Conducted on HUD OIG by DOT OIG

The U.S. Department of Housing and Urban Development, Office of 

Inspector General (HUD OIG), received a grade of pass (the highest rating) 

on the peer review report issued by the U.S. Department of Transportation 

(DOT) OIG on September 28, 2018. There were no recommendations 

included in the System Review Report. The report stated: 

In our opinion, the system of quality control for the audit organization of the 

HUD OIG in effect for the year ended March 31, 2018, was suitably designed 

and complied with to provide the HUD OIG with reasonable assurance 

of performing and reporting in conformity with applicable professional 

standards in all material respects. Federal Audit organizations can receive a 

rating of pass, pass with deficiencies, or fail. The HUD OIG has received a peer 

review rating of pass.

Peer Review Conducted by HUD OIG on DoD OIG

HUD OIG conducted an external peer review of the U.S. Department of 

Defense (DoD) OIG, Office of Audit, and issued a final report September 

27, 2018. DoD OIG received a peer review rating of pass. A copy of the 

external quality control review report can be viewed at https://media.

defense.gov/2018/Oct/05/2002048826/-1/-1/1/TRANSMITTAL%20

MEMO%20AND%20SYSTEM%20REVIEW%20REPORT.PDF.

OFFICE OF INVESTIGATION

Peer Review Conducted on HUD OIG by DHS OIG

The U.S. Department of Homeland Security (DHS) OIG conducted a peer 

review of the HUD OIG, Office of Investigation, and issued a final report on 

July 3, 2017. DHS OIG determined that HUD OIG was in compliance with 

the quality standards established by the Council of the Inspectors General 

on Integrity and Efficiency (CIGIE) and the Attorney General’s guidelines.

51 PEER REVIEW REPORTING I HUD OIG Semiannual Report to Congress
Peer Review Conducted by HUD OIG on DHS OIG

HUD OIG conducted an external peer review of the DHS OIG, Office 

of Investigation, and issued a final report on June 5, 2020. HUD OIG 

determined that DHS OIG was in compliance with the quality standards 

established by CIGIE. 

OFFICE OF EVALUATION

Peer Review Conducted on HUD OIG by CIGIE Team

A CIGIE external review team reviewed the HUD OIG, Office of Evaluation. 

The team concluded that the Office of Evaluation’s policies and procedures 

generally complied with the Quality Standards for Inspection and 

Evaluation. The team also offered observations regarding four reports 

reviewed. The peer review team observed that all reviewed reports did not 

fully follow established quality control policies and procedures. HUD OIG 

did not agree with all team observations and offered a written rebuttal. 

However, the Office of Evaluation made changes to its policies and 

procedures and reporting approaches to address the team’s observations. 

Peer Review Conducted by HUD OIG on FHFA OIG

HUD OIG conducted an external peer review of the Federal Housing 

Finance Agency (FHFA) OIG’s inspection and evaluation functions and 

issued a final report on September 10, 2019. 

A copy of the external quality control review report can be viewed at 

https://www.fhfaoig.gov/sites/default/files/Final%20Report%20-%20

External%20Peer%20Review%20of%20FHFA%20OIG.pdf

52 PEER REVIEW REPORTING I HUD OIG Semiannual Report to Congress
APPENDIX 1 - REPORTS ISSUED

Internal Audit Reports

Chief Financial Officer

2021-AT-0002 HUD Did Not Fully Comply With the Payment Integrity Information Act of 2019, 05/17/2021.

Housing

2021-KC-0003 HUD’s Major Program Offices Can Improve Their Preparedness To Respond to Upcoming 

Natural Disasters, 07/26/2021.

2021-KC-0004 HUD’s Office of Multifamily Housing Programs’ Complaint Process Did Not Ensure That Health 

and Safety Complaints Were Resolved in a Timely Manner, 07/28/2021.

2021-KC-0005 COVID-19 Forbearance Data in HUD’s Single Family Default Monitoring System Generally 

Agreed With Information Maintained by Loan Servicers, 08/16/2021.

53 APPENDIX 1 – REPORTS ISSUED I HUD OIG Semiannual Report to Congress

Public and Indian Housing

2021-CH-0001 HUD Remains Challenged To Serve the Maximum Number of Eligible Families Due to 

Decreasing Utilization in the Housing Choice Voucher Program, 09/15/2021.
Audit-Related Memorandums10

Chief Procurement Officer

2021-FW-0801 Limited Review of HUD’s Office of Chief Procurement Officer Pandemic-Related Procurement 

Accommodations and Challenges, 07/14/2021.

Housing

2021-KC-0802 Promoting a Homeless Waitlist Preference at Multifamily-Assisted Rental Unit Properties, 

06/17/2021.

External Audit Reports

Community Planning and Development

2021-FW-1001 Harris County Community Services Department, Houston, TX, Was Inefficient and Ineffective in 

Operating Its Hurricane Harvey Program, 06/02/2021.

2021-FW-1002

The City of Houston’s Housing and Community Development Department, Houston, TX, 

Did Not Always Ensure That Its Program Followed Procurement Requirements, 06/21/2021. 

Questioned: $1,260,680. Unsupported: $1,260,680. Better use: $9,736,636.

54 APPENDIX 1 – REPORTS ISSUED I HUD OIG Semiannual Report to Congress

10The memorandum format is used to communicate the results of reviews not performed in accordance with generally accepted government auditing standards; to close out assignments with no findings 

and recommendations; to respond to requests for information; or to report on the results of a survey, an attestation engagement, or civil actions or settlements.
External Audit Reports Continued

Public and Indian Housing

2021-FW-1003

The Bay City Housing Authority, Bay City, TX, Did Not Follow Requirements for Its Legal Services 

Contract, Administrative Costs, and Board Meetings, 09/29/2021. Questioned: $44,256. 

Unsupported: $31,911. Better use: $24,250.

Internal Evaluation Reports

Human Capital Management

2020-OE-0002 Opportunities Exist To Improve the U.S. Department of Housing and Urban Development’s 

Hiring Process

Housing

2020-OE-0003 HUD Program Offices' Policies and Approaches for Radon

Information Technology

2020-OE-0006 HUD’s Use of, Accounting for, and Reporting on CARES Act Funding

2021-OE-0003 HUD Information Technology Modernization Roadmap Evaluation

2021-OE-0004 Topic Brief - 2021 Persistent IT Challenges and Issues Facing HUD

55 APPENDIX 1 – REPORTS ISSUED I HUD OIG Semiannual Report to Congress
APPENDIX 2 - TABLES

TABLE A

AUDIT REPORTS ISSUED BEFORE START OF PERIOD WITH NO MANAGEMENT DECISION AS OF 09/30/2021

*Significant Audit Reports Described in Previous Semiannual Reports 

56 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress

Report number Report title Issue date

* 2016-PH-0001 HUD Did Not Always Provide Adequate Oversight of Property 

Acquisition and Disposition Activities 06/30/2016

* 2016-PH-0005 HUD Did Not Always Provide Accurate and Supported Certifications of 

State Disaster Grantee Procurement Processes 09/29/2016

2017-CF-0801

HUD Needs To Clarify Whether Illegal-Undocumented Aliens Are 

Eligible for Assistance Under the Housing Opportunities for Persons 

With AIDS Program

08/21/2017

* 2017-PH-0002

HUD Did Not Provide Sufficient Guidance and Oversight To Ensure 

That State Disaster Grantees Followed Proficient Procurement 

Processes

09/22/2017

* 2017-NY-0002 HUD Could Improve Its Controls Over the Disposition of Real 

Properties Assisted With Community Development Block Grant Funds 09/29/2017
Report number Report title Issue date

* 2018-FW-0002 HUD’s Office of Block Grant Assistance Had Not Codified the 

Community Development Block Grant Disaster Recovery Program 07/23/2018

* 2019-NY-1001 The State of New York Did Not Ensure That Properties Purchased 

Under the Acquisition Component of Its Program Were Eligible 03/29/2019

* 2019-NY-1002

The State of New York Did Not Ensure That Appraised Values Used 

by Its Program Were Supported and Appraisal Costs and Services 

Complied With Requirements

05/29/2019

* 2019-KC-0002 HUD Paid Rental Subsidies To Benefit Public Housing and Voucher 

Tenants Reported as Excluded From Federal Programs or Deceased 06/25/2019

57 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
EVALUATION REPORTS ISSUED BEFORE START OF PERIOD WITH NO MANAGEMENT DECISION AS OF 09/30/2021

58 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress

Report number Report title Issue date

2014-OE-0002 Risk Based Enforcement Could Improve Program Effectiveness 02/12/2016

2016-OE-0004S Opportunities for Improvement within CPD’s Risk Management 

Process for Hurricane Sandy Grants 03/29/2017

2016-OE-0002 HUD Web Application Security Evaluation 06/06/2018

2019-OE-0001 HUD Has Not Referred Troubled Public Housing Agencies as the Law 

and Regulations Require 02/04/2020

2018-OE-0004 HUD IT System Management and Oversight of the Section 184 

Program 08/13/2018
APPENDIX 2 - TABLES

TABLE B

SIGNIFICANT AUDIT REPORTS FOR WHICH FINAL ACTION HAD NOT BEEN COMPLETED WITHIN 12 MONTHS AFTER THE DATE OF THE 

INSPECTOR GENERAL’S REPORT

Report number Report title Issue date Decision date Final action 

target date

2005-AT-1013

Corporacion para el Fomento Economico de la Ciudad Capital, 

San Juan, Puerto Rico, Did Not Administer Its Independent 

Capital Fund in Accordance with HUD Requirements

09/15/2005 01/11/2006 10/15/2021

2006-CH-1021

Housing Authority of the County of Cook, Chicago, Illinois, 

Had Weak Controls over Its Section 8 Housing Choice Voucher 

Program

09/30/2006 01/26/2007 09/30/2037

2010-AT-1003 The Housing Authority of Whitesburg Mismanaged Its 

Operations, Whitesburg, KY 04/28/2010 08/26/2010 11/29/2035

2011-PH-1005 The District of Columbia Did Not Administer Its HOME Program 

in Accordance With Federal Requirements, Washington, DC 12/23/2010 04/22/2011 10/15/2021

2011-NY-1010 The City of Buffalo Did Not Always Administer Its CDBG Program 

in Accordance With HUD Requirements, Buffalo, NY 04/15/2011 01/25/2012 10/15/2021

2011-AT-1018 The Municipality of San Juan, PR, Did Not Properly Manage Its 

HOME Investment Partnerships Program 09/28/2011 01/12/2012 10/15/2021

59 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2012-NY-1002 The City of New York Charged Questionable Expenditures to Its 

HPRP, New York, NY 10/18/2011 02/16/2012 10/15/2021

2012-PH-0001 HUD Needed To Improve Its Use of Its Integrated Disbursement 

and Information System To Oversee Its CDBG Program 10/31/2011 02/28/2012 Note 1

2012-LA-0001 HUD Did Not Adequately Support the Reasonableness of the 

Fee-for-Service Amounts or Monitor the Amounts Charged 11/16/2011 03/27/2012 10/15/2021

2012-PH-1011 Prince George’s County Generally Did Not Administer Its HOME 

Program in Accordance With Federal Requirements, Largo, MD 08/03/2012 11/30/2012 10/15/2021

2013-PH-1001 Luzerne County Did Not Properly Evaluate, Underwrite, and 

Monitor a High-Risk Loan, Wilkes-Barre, PA 10/31/2012 01/31/2013 Note 1

2013-NY-1006

Nassau County Did Not Administer Its HOME Investment 

Partnerships Program in Accordance With HUD Requirements, 

Nassau County, NY

05/13/2013 09/06/2013 10/15/2021

2013-LA-1009 The City of Hawthorne Inappropriately Used Nearly $1.6 Million 

in HOME Funds for Section 8 Tenants, Hawthorne, CA 09/13/2013 01/06/2014 Note 1

60 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2013-LA-1010

The City of Hawthorne Did Not Administer Its CDBG 

Program Cost Allocations in Accordance With HUD Rules and 

Requirements, Hawthorne, CA

09/20/2013 01/06/2014 Note 2

2013-NY-1010 The City of Auburn Did Not Always Administer Its CDBG Program 

in Accordance With HUD Requirements, Auburn, NY 09/26/2013 01/24/2014 10/15/2021

2013-CH-1011

The Michigan State Housing Development Authority Did Not 

Follow HUD’s Requirements Regarding the Administration of Its 

Program, Lansing, MI

09/30/2013 01/15/2014 07/31/2029

2014-AT-1001 The Municipality of Arecibo Did Not Properly Administer Its 

HOME Program 12/03/2013 01/24/2014 10/15/2021

2014-FO-0003 Additional Details To Supplement Our Report on HUD's Fiscal 

Years 2013 and 2012 (Restated) Financial Statements 12/16/2013 07/09/2014 09/30/2022

2014-AT-1004

The State of Mississippi Did Not Ensure That Its Subrecipient and 

Appraisers Complied With Requirements, and It Did Not Fully 

Implement Adequate Procedures for Its Disaster Infrastructure 

Program, Jackson, MS

12/30/2013 04/15/2014 10/15/2021

2014-FW-0001

The Boston Office of Public Housing Did Not Provide Adequate 

Oversight of Environmental Reviews of Three Housing Agencies, 

Including Reviews Involving Recovery Act Funds

02/07/2014 03/17/2015 10/15/2021

61 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2014-NY-0001 HUD Did Not Provide Effective Oversight of Section 202 

Multifamily Project Refinances 02/19/2014 06/10/2014 10/15/2021

2014-FW-0002 Improvements Are Needed Over Environmental Reviews of 

Public Housing and Recovery Act Funds in the Kansas City Office 05/12/2014 03/17/2015 10/15/2021

2014-LA-0004

HUD Could Not Support the Reasonableness of the Operating 

and Capital Fund Programs’ Fees and Did Not Adequately 

Monitor Central Office Cost Centers

06/30/2014 10/20/2014 10/15/2021

2014-KC-0002 The Data in CAIVRS Did Not Agree With the Data in FHA’s Default 

and Claims Systems 07/02/2014 10/27/2014 Note 1

2014-NY-1008 Palladia, Inc., Did Not Administer Its Supportive Housing 

Program in Accordance With HUD Requirements, New York, NY 07/25/2014 11/21/2014 10/15/2021

2014-CH-1006

The Goshen Housing Authority, Goshen, IN, Failed To Follow 

HUD’s and Its Own Requirements Regarding the Administration 

of Its Program

08/14/2014 01/21/2015 03/16/2022

2014-PH-1008

The State of New Jersey Did Not Fully Comply With Federal 

Procurement and Cost Principle Requirements in Implementing 

Its Tourism Marketing Program

08/29/2014 09/02/2015 Note 1

62 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2014-FW-0005 Improvements Are Needed Over Environmental Reviews of 

Public Housing and Recovery Act Funds in the Detroit Office 09/24/2014 03/17/2015 10/15/2021

2015-NY-1001

The City of New York Did Not Always Disburse CDBG Disaster 

Recovery Assistance Funds to Its Subrecipient in Accordance 

With Federal Regulations, New York, NY

11/24/2014 03/23/2015 Note 2

2015-AT-0001

HUD’s Office of Community Planning and Development Did Not 

Always Pursue Remedial Actions but Generally Implemented 

Sufficient Controls for Administering Its Neighborhood 

Stabilization Program

03/31/2015 08/28/2015 10/15/2021

2015-LA-1004

The Housing Authority of the County of San Bernardino, San 

Bernardino, CA, Used Shelter Plus Care Program Funds for 

Ineligible and Unsupported Participants

05/29/2015 09/16/2015 10/15/2021

2015-PH-1003

The State of New Jersey Did Not Comply With Federal 

Procurement and Cost Principle Requirements in Implementing 

Its Disaster Management System

06/04/2015 10/02/2015 Note 1

2015-FW-0001

HUD Did Not Adequately Implement or Provide Adequate 

Oversight To Ensure Compliance With Environmental 

Requirements

06/16/2015 10/07/2015 10/15/2021

2015-LA-0002 HUD Did Not Provide Adequate Oversight of the Section 184 

Indian Home Loan Guarantee Program 07/06/2015 10/28/2015 12/31/2021

63 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2015-LA-1005

NOVA Financial & Investment Corporation’s FHA-Insured Loans 

With Downpayment Assistance Gifts Did Not Always Meet HUD 

Requirements

07/09/2015 09/11/2015 Note 1

2015-CH-0001 HUD Did Not Always Provide Adequate Oversight of Its Section 

203(k) Rehabilitation Loan Mortgage Insurance Program 07/31/2015 11/27/2015 12/29/2021

2015-KC-0002

The Office of Community Planning and Development’s Reviews 

of Matching Contributions Were Ineffective and Its Application 

of Match Reductions Was Not Always Correct

08/11/2015 12/09/2015 Note 1

2015-AT-0002

HUD’s Office of Multifamily Asset Management and Portfolio 

Oversight Did Not Comply With Its Requirements For Monitoring 

Management Agents' Costs

08/21/2015 12/16/2015 10/15/2021

2015-NY-1010

New York State Did Not Always Administer Its Rising Home 

Enhanced Buyout Program in Accordance With Federal and State 

Regulations

09/17/2015 03/01/2016 10/15/2021

2015-NY-1011

Program Control Weaknesses Lessened Assurance That New York 

Rising Housing Recovery Program Funds Were Always Disbursed 

for Eligible Costs

09/17/2015 03/18/2016 10/15/2021

2015-LA-1009 loanDepot’s FHA-Insured Loans With Downpayment Assistance 

Funds Did Not Always Meet HUD Requirements 09/30/2015 01/12/2016 Note 1

64 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2015-LA-1010

loanDepot’s FHA-Insured Loans With Golden State Finance 

Authority Downpayment Assistance Gifts Did Not Always Meet 

HUD Requirements

09/30/2015 01/12/2016 Note 1

2016-FO-0001 Audit of Fiscal Years 2015 and 2014 (Restated) Financial 

Statements 11/13/2015 03/24/2016 10/15/2021

2016-FO-0003

Additional Details To Supplement Our Fiscal Years 2015 and 2014 

(Restated) U.S. Department of Housing and Urban Development 

Financial Statement Audit

11/18/2015 03/22/2016 09/30/2022

2016-DP-0801 Review of Information System Controls Over the Government 

National Mortgage Association 11/30/2015 03/30/2016 10/15/2021

2016-NY-1003

The City of Rochester, NY, Did Not Always Administer Its 

Community Development Block Grant Program in Accordance 

With HUD Requirements

02/05/2016 06/17/2016 10/15/2021

2016-NY-1006

New York State Did Not Always Disburse Community 

Development Block Grant Disaster Recovery Funds in 

Accordance With Federal and State Regulations

03/29/2016 07/27/2016 10/15/2021

2016-NY-1007

The City of Jersey City, NJ's Community Development Block 

Grant Program Had Administrative and Financial Control 

Weaknesses

03/30/2016 06/08/2016 10/15/2021

65 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2016-PH-0001 HUD Did Not Always Provide Adequate Oversight of Property 

Acquisition and Disposition Activities 06/30/2016 02/16/2017 Note 3

2016-NY-0001 Operating Fund Calculations Were Not Always Adequately 

Verified 09/12/2016 12/22/2016 04/01/2025

2016-FW-1010

The State of Oklahoma Did Not Obligate and Spend Its 

Community Development Block Grant Disaster Recovery Funds 

in Accordance With Requirements

09/30/2016 01/17/2017 Note 1

2016-PH-1009

The State of New Jersey Did Not Disburse Disaster Funds to 

Its Contractor in Accordance With HUD, Federal, and Other 

Applicable Requirements

09/30/2016 01/27/2017 Note 1

2017-BO-1001 The State of Connecticut Did Not Always Comply With CDBG 

Disaster Recovery Assistance Requirements 10/12/2016 02/01/2017 10/15/2021

2017-KC-0001 FHA Paid Claims for an Estimated 239,000 Properties That 

Servicers Did Not Foreclose Upon or Convey on Time 10/14/2016 02/28/2017 10/15/2021

2017-NY-1001

The City of New York, NY, Implemented Policies That Did Not 

Always Ensure That CDBG Disaster Recovery Funds Were 

Disbursed in Accordance With Its Action Plan and Federal 

Requirements

11/02/2016 05/08/2017 Note 1

66 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2017-FO-0003

Additional Details To Supplement Our Fiscal Years 2016 and 2015 

(Restated) U.S. Department of Housing and Urban Development 

Financial Statement Audit

11/15/2016 09/13/2017 04/01/2022

2017-NY-1004

The City of New York, NY, Lacked Adequate Controls To Ensure 

That the Use of CDBG-DR Funds Was Always Consistent With the 

Action Plan and Applicable Federal and State Requirements

12/21/2016 04/17/2017 Note 1

2017-NY-1005

Union County, NJ'S HOME Investment Partnerships Program 

Was Not Always Administered in Compliance With Program 

Requirements

01/13/2017 05/11/2017 10/15/2021

2017-LA-0002 HUD Failed To Follow Departmental Clearance Protocols for FHA 

Programs, Policies, and Operations 01/25/2017 09/22/2017 10/15/2021

2017-KC-1801

Final Action Memorandum: Purchaser of HUD-Insured SingleFamily Property Settled Allegations of Causing the Submission 

of a False Claim

02/23/2017 02/23/2017 10/15/2021

2017-LA-0003 HUD Failed To Adequately Oversee FHA-Insured Loans With 

Borrower-Financed Downpayment Assistance 03/03/2017 06/22/2017 Note 1

2017-PH-1001 The City of Pittsburgh, PA, Did Not Always Administer Its CDBG 

Program in Accordance With HUD and Federal Requirements 03/22/2017 07/19/2017 10/15/2021

67 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2017-CF-1803

United Shore Financial Services, LLC, Settled Allegations of 

Failing To Comply With HUD’s Federal Housing Administration 

Loan Requirements

03/29/2017 03/29/2017 03/27/2022

2017-NY-0001 HUD PIH's Required Conversion Program Was Not Adequately 

Implemented 05/18/2017 09/15/2017 12/31/2023

2017-PH-1003

The Yorkville Cooperative, Fairfax, VA, Did Not Administer 

Its HUD-Insured Property and Housing Assistance Contract 

According to Applicable Requirements

05/22/2017 09/19/2017 10/15/2021

2017-KC-0005 Owners of Cooperative Housing Properties Generally Charged 

More for Their Section 8 Units Than for Their Non-Section 8 Units 06/12/2017 10/06/2017 10/15/2021

2017-LA-1005

The City of Huntington Park, CA, Did Not Administer Its 

Community Development Block Grant Program in Accordance 

With Requirements

06/16/2017 10/17/2017 10/15/2021

2017-KC-0006 HUD Did Not Conduct Rulemaking or Develop Formal 

Procedures for Its Single-Family Note Sales Program 07/14/2017 10/19/2017 10/15/2021

2017-FW-1011

BLM Companies LLC Failed To Ensure That It Protected and 

Preserved HUD Properties Under Its Field Service Manager 

Contract for Area 1D

08/29/2017 12/26/2017 Note 1

68 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2017-FW-1012 The City of New Orleans, New Orleans, LA, Did Not Always 

Properly Administer Its HOME Program 09/06/2017 12/19/2017 10/15/2021

2017-LA-0004 HUD Did Not Have Adequate Controls To Ensure That Servicers 

Properly Engaged in Loss Mitigation 09/14/2017 01/11/2018 10/15/2021

2017-NY-1010

The State of New York Did Not Show That Disaster Recovery 

Funds Under Its Non-Federal Share Match Program Were Used 

for Eligible and Supported Costs

09/15/2017 01/12/2018 10/15/2021

2017-LA-0005 HUD Did Not Always Follow Applicable Requirements When 

Forgiving Debts and Terminating Debt Collections 09/21/2017 01/17/2018 10/15/2021

2017-PH-1006

The Owner of Schwenckfeld Manor, Lansdale, PA, Did Not 

Always Manage Its HUD-Insured Property in Accordance With 

Applicable HUD Requirements

09/25/2017 01/23/2018 02/01/2030

2017-CF-1807

Residential Home Funding Corp. Settled Allegations of Failing 

To Comply With HUD’s Federal Housing Administration Loan 

Requirements

09/28/2017 09/28/2017 10/15/2021

2017-NY-0002

HUD Could Improve Its Controls Over the Disposition of Real 

Properties Assisted With Community Development Block Grant 

Funds

09/29/2017 01/26/2018 Note 3

69 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2018-FO-0003 Fiscal Years 2017 and 2016 (Restated) Financial Statements Audit 11/15/2017 04/03/2018 Note 1

2018-FO-0004

Additional Details To Supplement Our Fiscal Years 2017 and 2016 

(Restated) U.S. Department of Housing and Urban Development 

Financial Statement Audit

11/15/2017 07/02/2018 Note 1

2018-AT-1802

Yabucoa Housing Project, Yabucoa Volunteers of America Elderly 

Housing, Inc., Yabucoa, PR, Section 202 Supportive Housing for 

the Elderly Program

12/29/2017 04/20/2018 10/15/2021

2018-FW-1001 Jefferson Parish, Jefferson, LA, Did Not Always Properly 

Administer Its Rehabilitation Program 01/29/2018 05/22/2018 12/31/2022

2018-NY-1003

The Housing Authority of the City of Asbury Park, NJ, Did 

Not Always Administer Its Operating and Capital Funds in 

Accordance With Requirements

02/08/2018 06/07/2018 01/28/2050

2018-DP-0003 Fiscal Year 2017 Review of Information Systems Controls in 

Support of the Financial Statements Audit 03/09/2018 06/07/2018 10/15/2021

2018-KC-0802 Limited Review of HUD Multifamily Waiting List Administration 03/22/2018 07/25/2018 Note 1

70 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2018-CF-1801

MetLife Home Loans, LLC, and a Borrower’s Son Settled 

Allegations of Failing To Comply With HUD’s Federal Housing 

Administration HECM Loan Requirements

03/23/2018 08/09/2018 10/15/2021

2018-KC-0001 FHA Insured $1.9 Billion in Loans to Borrowers Barred by Federal 

Requirements 03/26/2018 07/11/2018 Note 1

2018-LA-1003

The City of South Gate, CA, Did Not Administer Its Community 

Development Block Grant Program in Accordance With HUD 

Requirements

03/29/2018 07/25/2018 10/15/2021

2018-LA-0002

HUD Did Not Have Adequate Controls To Ensure That Grantees 

Submitted Accurate Tribal Enrollment Numbers for Program 

Funding

05/07/2018 08/23/2018 10/15/2021

2018-CH-0002

HUD Lacked Adequate Oversight of Lead-Based Paint Reporting 

and Remediation in Its Public Housing and Housing Choice 

Voucher Programs

06/14/2018 12/06/2018 12/31/2021

2018-BO-1003 The City of Providence, RI, Did Not Properly Administer Its HOME 

Program 06/20/2018 09/28/2018 10/15/2021

2018-LA-0801

The Office of Native American Programs Section 184 Program 

Continues To Operate Without Adequate Oversight 3 Years After 

the Prior OIG Audit

08/27/2018 12/21/2018 12/31/2021

71 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2018-BO-0001

HUD’s Office of Residential Care Facilities Did Not Always Have 

and Use Financial Information To Adequately Assess and Monitor 

Nursing Homes

09/17/2018 03/07/2019 10/15/2021

2018-BO-1005 The State of Connecticut Did Not Ensure That Its Grantees 

Properly Administered Their Housing Rehabilitation Programs 09/19/2018 03/27/2019 10/15/2021

2018-KC-0004 HUD Did Not Always Identify and Collect Partial Claims Out of 

Surplus Foreclosure Proceeds 09/20/2018 04/18/2019 12/31/2021

2018-LA-0005

HUD Did Not Have Adequate Controls To Ensure That Partial 

Claim Notes for FHA Loans Were Properly Tracked for Future 

Collection

09/21/2018 03/08/2019 10/15/2021

2018-NY-0001 HUD Did Not Adequately Administer Its Housing Counseling 

Program 09/24/2018 02/26/2019 04/01/2023

2018-PH-1007

The Crisfield Housing Authority, Crisfield, MD, Did Not Properly 

Administer Its Public Housing Program Operating and Capital 

Funds

09/25/2018 03/01/2019 10/15/2021

2018-PH-1008

The City of Erie, PA, Did Not Always Administer Its Code 

Enforcement and Community Policing Activities in Accordance 

With HUD and Federal Requirements

09/26/2018 03/07/2019 10/15/2021

72 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2018-LA-0007

HUD Paid an Estimated $413 Million for Unnecessary 

Preforeclosure Claim Interest and Other Costs Due to Lender 

Servicing Delays

09/27/2018 04/03/2019 10/15/2021

2018-NY-1007 The City of New York, NY, Did Not Always Use Disaster Recovery 

Funds Under Its Program for Eligible and Supported Costs 09/27/2018 02/28/2019 10/15/2021

2018-FW-1007

The State of Louisiana, Baton Rouge, LA, Did Not Always 

Maintain Adequate Documentation or Comply With Website 

Reporting Requirements

09/28/2018 03/29/2019 10/15/2021

2018-CH-1010

The City of Chicago’s Department of Public Health, Chicago, IL, 

Did Not Administer Its Lead Hazard Reduction Demonstration 

Grant Program in Accordance With HUD’s and Its Own 

Requirements

09/30/2018 03/14/2019 10/15/2021

2019-FO-0002 Audit of the Federal Housing Administration’s Financial 

Statements for Fiscal Years 2018 and 2017 (Restated) 11/14/2018 05/30/2019 Note 1

2019-FO-0003

Additional Details To Supplement Our Fiscal Years 2018 and 2017 

(Restated) U.S. Department of Housing and Urban Development 

Financial Statement Audit

11/15/2018 07/11/2019 10/15/2021

2019-AT-1002

Louisville Metro, Louisville, KY, Did Not Always Administer the 

TBRA Activity in Its HOME and CoC Programs in Accordance With 

Program Requirements

03/18/2019 07/16/2019 10/15/2021

73 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2019-KC-0001 FHA Improperly Paid Partial Claims That Did Not Reinstate Their 

Related Loans 04/11/2019 08/02/2019 10/15/2021

2019-FW-1001 The Little Rock Housing Authority, Little Rock, AR, Did Not Fully 

Meet Rental Assistance Demonstration Program Requirements 04/23/2019 09/20/2019 10/31/2022

2019-BO-1001 The City of Bridgeport, CT, Did Not Properly Administer Its HOME 

Program 04/25/2019 08/07/2019 10/15/2021

2019-AT-1004

The North Carolina Department of Commerce Did Not 

Administer Its Neighborhood Stabilization Program Grants as 

Required by HUD

06/14/2019 01/14/2020 10/15/2021

2019-KC-0002

HUD Paid Rental Subsidies To Benefit Public Housing and 

Voucher Tenants Reported as Excluded From Federal Programs 

or Deceased

06/25/2019 10/17/2019 Note 3

2019-LA-0801

HUD Completed the Agreed-Upon Corrective Actions for One 

of the Two Recommendations Reviewed From Prior OIG Audit 

Report 2015-LA-0001 on FHA-HAMP Partial Claims

07/15/2019 10/08/2019 10/15/2021

2019-NY-1003

New York City Department of Housing Preservation and 

Development, New York, NY, Did Not Always Ensure That Units 

Met Housing Quality Standards but Generally Abated Payments 

When Required

08/02/2019 11/25/2019 10/15/2021

74 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2019-BO-1003

The Commonwealth of Massachusetts Did Not Always Ensure 

That Its Grantees Complied With Applicable State and Federal 

Laws and Requirements

08/05/2019 12/03/2019 10/15/2021

2019-CH-1003

The Management Agent for Lake View Towers Apartments, 

Chicago, IL, Did Not Always Comply With HUD’s Section 8 HAP 

Program Requirements

09/03/2019 12/18/2019 10/15/2021

2019-CF-1803

Pacific Horizon Bancorp, Inc., and Two Loan Officers Settled 

Allegations of Failing To Comply With HUD’s Federal Housing 

Administration Loan Requirements

09/30/2019 09/30/2019 08/01/2024

2019-KC-0003 FHA Insured at Least $13 Billion in Loans to Ineligible Borrowers 

With Delinquent Federal Tax Debt 09/30/2019 01/15/2020 01/31/2022

2020-CH-1001

The City of Detroit’s Housing and Revitalization Department, 

Detroit, MI, Did Not Administer Its Lead Hazard Reduction 

Demonstration Grant Program in Accordance With HUD’s 

Requirements

10/02/2019 01/31/2020 10/15/2021

2020-CH-0001

HUD’s Office of the Chief Financial Officer Generally Complied 

With the Digital Accountability and Transparency Act of 2014 

With a Few Exceptions

11/07/2019 02/11/2020 10/15/2021

2020-AT-0801

HUD Had Not Established Deadlines for Reporting FHA-HAMP 

Nonincentivized Loan Modifications and Filing Nonincentivized 

Partial Claims

02/04/2020 06/01/2020 05/31/2022

75 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2020-FO-0003

Additional Details To Supplement Our Fiscal Year 2019 U.S. 

Department of Housing and Urban Development Financial 

Statements Audit

02/07/2020 09/08/2020 Note 2

2020-FW-0001

HUD Did Not Have Adequate Oversight To Ensure That Its 

Payments to Subsidized Property Owners Were Accurate and 

Supported When It Suspended Contract Administrator Reviews

02/26/2020 06/09/2020 12/31/2021

2020-LA-1002

The Housing Authority of the City of Long Beach, CA, Did Not 

Administer Its Housing Choice Voucher Program in Accordance 

With HUD Requirements

03/05/2020 06/19/2020 10/15/2021

2020-AT-1002 The Puerto Rico Department of Housing, San Juan, PR, Should 

Strengthen Its Capacity To Administer Its Disaster Grants 03/16/2020 07/13/2020 Note 2

2020-CH-0003 HUD Lacked Adequate Oversight of Public Housing Agencies’ 

Compliance With the Lead Safe Housing Rule 03/18/2020 09/03/2020 12/10/2022

2020-LA-1003

The City of Mesa, AZ, Did Not Administer Its Community 

Development Block Grant in Accordance With HUD 

Requirements

04/13/2020 08/11/2020 10/15/2021

2020-KC-1001 Englewood Apartments, Kansas City, MO, Did Not Comply With 

Tenant Eligibility and Recertification Requirements 06/08/2020 09/22/2020 01/01/2022

76 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action 

target date

2020-CH-0004 HUD Needs To Improve Its Oversight of Lead in the Water of 

Housing Choice Voucher and Public Housing Program Units 08/21/2020 02/10/2021 12/31/2021

2020-CH-0005 HUD Needs To Improve Its Oversight of Lead in the Water of 

Multifamily Housing Units 08/21/2020 01/26/2021 12/31/2021

2020-LA-1005 Mid America Mortgage, dba 1st Tribal Lending, Pinole, CA, Did 

Not Always Follow HUD’s Section 184 Program Requirements 09/03/2020 12/14/2020 12/31/2021

2020-LA-0002 HUD Had Implemented Most of the Required Responsibilities 

Stated in the Geospatial Data Act of 2018 09/24/2020 01/11/2021 10/15/2021

77 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
SIGNIFICANT AUDIT REPORTS ISSUED WITHIN THE PAST 12 MONTHS THAT WERE DESCRIBED IN PREVIOUS SEMIANNUAL REPORTS FOR 

WHICH FINAL ACTION HAD NOT BEEN COMPLETED AS OF 09/30/2021

Report number Report title Issue date Decision date Final action

2021-LA-1001

The City of Compton, Compton, CA, Did Not Always Administer 

Neighborhood Stabilization Program Funds in Compliance With 

Procedures and Regulations

10/27/2020 01/26/2021 01/26/2022

2021-DP-0001 Fiscal Year 2019 Review of Information Systems Controls in 

Support of the Financial Statements Audit 12/17/2020 04/08/2021 03/08/2022

2021-KC-0002 FHA Insured $940 Million in Loans for Properties in Flood Zones 

Without the Required Flood Insurance 01/05/2021 04/26/2021 03/31/2022

2021-LA-1002

Neighborhood Housing Services of Los Angeles County, Los 

Angeles, CA, Did Not Always Follow Program Requirements in 

Administering Its NSP2

01/05/2021 04/29/2021 04/25/2022

2021-PH-0002

HUD Improperly Accounted for and Managed Reimbursements 

It Received Through Rent Credits From the General Services 

Administration

03/29/2021 05/28/2021 05/26/2022

Audits Excluded:

77 audits under repayment plans 

31 audits under debt claims collection processing, formal judicial 

review, investigation, or legislative solution

Notes: 

1 Management did not meet the target date. Target date is more than 1 year old. 

2 Management did not meet the target date. Target date is less than 1 year old. 

3 No Management decision

78 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
SIGNIFICANT EVALUATION REPORTS FOR WHICH FINAL ACTION HAD NOT BEEN COMPLETED WITHIN 12 MONTHS AFTER THE DATE 

OF THE INSPECTOR GENERAL’S REPORT

Report number Report title Issue date Decision date Final action

2013-ITED-0001 Federal Information Security Management Act (FISMA) Fiscal 

Year 2013 Evaluation Report 11/29/2013 11/29/2013 Note 1

2014-ITED-0001 HUD Privacy Program Evaluation Report 04/30/2014 04/30/2014 Note 1

2014-OE-0002 Risk Based Enforcement Could Improve Program Effectiveness 02/12/2016 n/a Note 2

2014-OE-0003 Federal Information Security Management Act (FISMA) Fiscal 

Year 2014 Evaluation Report 11/15/2014 11/15/2014 Note 1

2015-OE-0001 Federal Information Security Modernization Act (FISMA) Fiscal 

Year 2015 Evaluation Report 11/15/2015 11/15/2015 Note 1

2015-OE-0002 HUD IT Modernization Evaluation Report 09/29/2015 09/29/2015 Note 1

2016-OE-0002 HUD Web Application Security Evaluation Report 06/07/2017 n/a Note 2

79 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action

2016-OE-0004S Opportunities for Improvement Within CPD’s Risk Management 

Process for Hurricane Sandy Grants 03/29/2017 n/a Note 2

2016-OE-0006 HUD Fiscal Year 2016 Federal Information Security 

Modernization Act of 2014 (FISMA) Evaluation Report 11/10/2016 11/10/2016 Note 1

2017-OE-0007 HUD Fiscal Year 2017 Federal Information Security 

Modernization Act of 2014 (FISMA) Evaluation Report 10/31/2017 08/16/2018 Note 1

2018-OE-0001 HUD Privacy Program Evaluation Report 09/13/2018 11/27/2019 Note 1

2018-OE-0002 Fire Safety Planning for the Weaver Building Needs 

Improvement 06/12/2018 11/29/2018 Note 1

2018-OE-0003 HUD Fiscal Year 2018 Federal Information Security 

Modernization Act of 2014 (FISMA) Evaluation Report 10/31/2018 05/27/2019 Note 1

2018-OE-0004 HUD IT System Management and Oversight of the Section 184 

Program 08/13/2018 n/a Note 2

80 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
Report number Report title Issue date Decision date Final action

2019-OE-0001 HUD Has Not Referred Troubled Public Housing Agencies as the 

Law and Regulations Require 02/04/2020 n/a Note 2

2019-OE-0002 HUD Fiscal Year 2019 Federal Information Security 

Modernization Act of 2014 (FISMA) Evaluation Report 06/24/2020 01/19/2021 Note 1

2019-OE-0002a HUD Personally Identifiable Information (PII) Records Protection 

and Management 06/25/2020 12/21/2020 Note 1

81 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
SIGNIFCANT EVALUATION REPORTS ISSUED WITHIN THE PAST 12 MONTHS THAT WERE DESCRIBED IN PREVIOUS SEMIANNUAL 

REPORTS FOR WHICH FINAL ACTION HAD NOT BEEN COMPLETED AS OF 09/30/2021

Report number Report title Issue date Decision date Final action

2019-OE-0003 Contaminated Sites Pose Potential Health Risks to Residents at 

HUD-Funded Properties 02/14/2021 09/07/2021 Note 3

2020-OE-0001 HUD Fiscal Year 2020 Federal Information Security 

Modernization Act of 2014 (FISMA) Evaluation Report 11/30/2020 03/30/2021 Note 3

Notes: 

1 Management did not meet the target date. Target date is more than 1 year old.

2 No management decision (for one or more recommendations)

3 Management was working to meet target date. Target date is less than 1 year old.

82 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
APPENDIX 2 - TABLES

TABLE C

Audit reports Number of 

audit reports

Questioned 

costs

Unsupported 

costs

A1  For which no management decision had been made by 

the beginning of the reporting period 5 $400,448 $396,882

A2  For which litigation, legislation, or investigation was 

pending at the beginning of the reporting period 0 0 0

A3  For which additional costs were added to reports in 

beginning inventory - 463 50

A4  For which costs were added to noncost reports 0 0 0

B1  Which were issued during the reporting period 2 1,305 1,293

B2  Which were reopened during the reporting period 0 0 0

Subtotals (A+B) 7 402,216 398,225

INSPECTOR GENERAL-ISSUED REPORTS WITH QUESTIONED AND UNSUPPORTED COSTS AS OF 09/30/2021 (DOLLARS IN THOUSANDS)

83 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
TABLE C CONTINUED

Audit reports Number of 

audit reports

Questioned

costs

Unsupported

costs

C     For which a management decision was made during 

the reporting period 111 7,292 6,879

 (1) Dollar value of disallowed costs:

 Due HUD

 Due program participants

1

0

6,968

324

6,879

0

 (2) Dollar value of disallowed costs: 0 0 0

D    For which a management decision had been made 

not to determine costs until completion of litigation, 

legislation, or investigation 

0 0 0

E     For which no management decision had been made by 

the end of the reporting period 

6

<21>12

394,924

<381,653>12

391,346

<378,079>12

11This audit report also contains recommendations with funds to be put to better use.

12The figures in brackets represent data at the recommendation level as compared to the report level. See Explanations of Tables C and D.

84 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
APPENDIX 2 - TABLES

TABLE D

INSPECTOR GENERAL-ISSUED REPORTS WITH RECOMMENDATIONS THAT FUNDS BE PUT TO BETTER USE AS OF 09/30/2021 

(DOLLARS IN THOUSANDS)

Audit reports Number of 

audit reports Dollar value

A1  For which no management decision had been made by 

the beginning of the reporting period 6 $5,929,25313

A2  For which litigation, legislation, or investigation was 

pending at the beginning of the reporting period 0 0

A3  For which additional costs were added to reports in 

beginning inventory - 0

A4  For which costs were added to noncost reports 0 0

B1  Which were issued during the reporting period 2 9,761

B2  Which were reopened during the reporting period 0 0

Subtotals (A+B) 8 5,939,014

13The beginning balance of Table D was reduced by $31 million due to a system transaction table error associated with recommendation 2017-FO-0003-008-G. 

85 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
TABLE D CONTINUED

Audit reports Number of 

audit reports Dollar value

C     For which a management decision was made during 

the reporting period 314 944,082

 (1) Dollar value of recommendations that were agreed

 to by management:

 Due HUD

 Due program participants

3

0

925,882

0

 (2) Dollar value of recommendations that were not

 agreed upon by management 115 18,200

D    For which a management decision had been made 

not to determine costs until completion of litigation, 

legislation, or investigation 

0 0

E     For which no management decision had been made by 

the end of the reporting period 

5

<5>16

4,994,932

<4,988,837>16

14One audit report also contains recommendations with questioned costs. 

15This audit report also contains recommendations with funds agreed to by management.

16The figures in brackets represent data at the recommendation level as compared to the report level. See Explanations of Tables C and D.

86 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
EXPLANATIONS OF TABLES C AND D

The Inspector General Act Amendments of 1988 require inspectors general 

and agency heads to report cost data on management decisions and final 

actions on audit reports. The current method of reporting at the “report” 

level rather than at the individual audit “recommendation” level results in 

misleading reporting of cost data. Under the Act, an audit “report” does not 

have a management decision or final action until all questioned cost items 

or other recommendations have a management decision or final action. 

Under these circumstances, the use of the “report” based rather than the 

“recommendation” based method of reporting distorts the actual agency 

efforts to resolve and complete action on audit recommendations. For 

example, certain cost items or recommendations could have a management 

decision and repayment (final action) in a short period of time. Other cost 

items or nonmonetary recommendation issues in the same audit report 

may be more complex, requiring a longer period of time for management’s 

decision or final action. Although management may have acted on the 

majority of recommendations from an audit report, the current “all or 

nothing” reporting format does not recognize their efforts.

The closing inventory for items with no management decision in tables C and 

D (line E) reflects figures at the report level as well as the recommendation 

level.

87 APPENDIX 2 – TABLES I HUD OIG Semiannual Report to Congress
APPENDIX 3 - 

INSPECTOR GENERAL 

EMPOWERMENT ACT

The Inspector General Empowerment Act (IGEA) requires the Office of 

Inspector General (OIG) to report on each audit and evaluation report 

for which the U.S. Department of Housing and Urban Development 

(HUD) did not return comments within 60 days of HUD OIG’s providing 

the report to the Department.

SUMMARY OF REPORTS WITH NO ESTABLISHMENT COMMENT

There are no instances of reports with no establishment comment this 

semiannual reporting period. 

SUMMARY OF REPORTS WITH OPEN RECOMMENDATIONS 

The IGEA requires OIGs to report on each audit and evaluation report for which 

there are any outstanding unimplemented recommendations, including the 

combined potential cost savings of these recommendations. Summaries for 

the Office of Audit and Office of Evaluation (OE) are presented below.

OFFICE OF AUDIT

The Department currently has 980 outstanding (open) unimplemented 

recommendations with a combined potential cost savings of more than 

$19 billion. The following table and charts reflect the reasons why they 

remain unimplemented:

1. 919 recommendations have active corrective action plans in place or 

valid repayment plans, but HUD has not finished implementing the 

recommendation. 

2. 61 recommendations are currently without management decisions 

(agreement between the Department and OIG), 33 of which are 

beyond the 180-day statutory requirement due to disagreement and 

were reported in table A of OIG’s Semiannual Report to Congress 

(SAR). The remainder are within the 180-day limit, during which time 

management and OIG can arrive at an agreed-upon corrective action 

plan..

3. 367 open recommendations have management decisions in place 

but are currently under investigative, legislative, or judicial action or 

under a valid repayment plan and are, therefore, suspended pending 

resolution.

88 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress
OFFICE OF AUDIT SUMMARY

89 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress

Calendar year Number of open 

recommendations

Cumulative estimated cost savings from 

open recommendations

Pre-2001 2 $1,688,555

2001 1 160,000

2002 5 709,105

2003 12 1,747,990

2004 7 8,068,042

2005 5 2,999,361

2006 12 10,272,292

2007 14 4,977,549

2008 29 71,460,286

2009 24 4,949,326

2010 16 18,251,251

2011 33 100,437,848

2012 12 10,414,794

2013 50 56,792,251

2014 95 358,201,520

2015 80 319,278,349

2016 121 7,277,710,261

2017 131 637,456,663

2018 122 3,439,935,316

2019 81 6,662,300,761

2020 69 4,276,717

2021 59 456,584,756

Total 980 19,448,672,993
OFFICE OF EVALUATION

OE conducts evaluations focused on improving departmental operations and programs. OE’s recommendations do not focus on direct cost savings but, rather, on 

improving program effectiveness, reducing the likelihood of negative outcomes, and addressing HUD’s top management challenges.

Calendar year Number of open recommendations

2013 2

2014 7

2015 6

2016 3

2017 9

2018 24

2019 0

2020 49

2021 23

Total 123

90 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress
STATISTICAL TABLE SHOWING INVESTIGATIVE REPORT METRICS 

The data used in this statistical table were extracted from HUD OIG’s Case Management System. The Case Management System and its underlying infrastructure 

allow for data input and maintain data integrity during the complete investigative case cycle while ensuring data privacy and confidentiality. The system was 

developed in .Net 4.5.1, and the database is SQL 2017. HUD OIG develops queries to extract data from the Case Management System to meet business requirements, 

such as the information used to create this statistical table. The footnotes provide additional guidance pertaining to each requested category of information.

REPORTING PERIOD: FISCAL YEAR 2021, PERIOD 2 (SAR 86), APRIL 1, 2021, THROUGH SEPTEMBER 30, 2021

Measure Total

A. Total number of investigative reports issued during 

the reporting period17 175

B. Total number of persons referred to the U.S. 

Department of Justice for criminal prosecution during 

the reporting period 

141

C. Total number of persons referred to State and local 

prosecuting authorities for criminal prosecution during 

the reporting period 

33

D. Total number of indictments and criminal 

informations during the reporting period that resulted 

from any prior referral to prosecuting authorities18

73

17Includes approved reports of investigation

18Includes all charging documents reported: criminal complaints, indictments, informations, and superseding indictments

91 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress
INVESTIGATIONS OF SENIOR GOVERNMENT EMPLOYEES

The IGEA requires OIG to summarize in the SAR each investigation involving 

a senior government employee when allegations of misconduct were 

substantiated. Listed below is the one case for this reporting period.

OIG initiated an investigation based on allegations that a former senior 

HUD employee was not recused from HUD matters while negotiating 

future employment with a private-sector firm conducting business with 

HUD. The former employee, after leaving HUD, represented the privatesector firm to HUD on matters this individual had worked on while a HUD 

employee. 

The investigation substantiated the allegations and also determined that 

the former employee removed from HUD and brought to a new privatesector employer many HUD documents and reports about financial 

institutions, which contained confidential, nonpublic, and proprietary 

information. 

On July 10, 2019, referred this matter to the U.S. Attorney’s Office (USAO) 

and HUD’s Office of Program Enforcement for any action they deemed 

appropriate. The USAO entered into a settlement agreement with the 

former employee, who agreed to pay $25,000 to settle allegations that 

the former employee had an improper conflict of interest with a company 

while serving as a senior employee at HUD. HUD settled with the former 

employee, resolving potential administrative allegations. 

INSTANCES OF WHISTLEBLOWER RETALIATION 

The IGEA requires OIG to include in the SAR a detailed description of any 

instance of whistleblower retaliation, including information about the official 

found to have engaged in retaliation and what, if any, consequences the 

establishment imposed to hold that official accountable. 

OIG has no instances of whistleblower retaliation to report in this 

semiannual reporting period. 

OIG INDEPENDENCE 

The IGEA requires OIG to include in the SAR a detailed description of any 

attempt by the establishment to interfere with the independence of OIG, 

including incidents in which the establishment has resisted or objected to 

oversight activities or restricted or significantly delayed access to information. 

OIG encountered instances in which access to agency information was 

delayed or denied. These instances were described in detail in OIG’s 

report No. 2019SU008945I, Review of HUD’s Disbursement of Grant Funds 

Appropriated for Disaster Recovery and Mitigation Activities in Puerto Rico, 

which was released to the public on April 20, 2021.

92 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress
REPORTS THAT WERE CLOSED DURING THE PERIOD THAT WERE NOT 

DISCLOSED TO THE PUBLIC 

Section 5(a)(22) of the Inspector General Act of 1978,19 as amended, requires 

that OIG report on each audit and investigation conducted by the office that is 

closed during the reporting period and was not disclosed to the public.

OFFICE OF AUDIT

The Office of Audit did not close any audits this semiannual period that 

were not disclosed to the public. 

OFFICE OF INVESTIGATION

OIG initiated an investigation based on allegations that a senior HUD 

employee interfered with a career employee’s promotion by trying to 

have the career employee terminated from employment with HUD, a 

potential violation of the Merit Systems Principles. The investigation was 

not referred to the USAO and disciplinary action was not taken against the 

senior HUD employee because the allegations were unsubstantiated. 

OFFICE OF EVALUATION

Topic Brief – 2021 Persistent IT Challenges and Issues Facing 

HUD

Issue Date: August 9, 2021

OIG assessed, for effectiveness, HUD’s information security program in 

accordance the Federal Information Security Modernization Act (FISMA), 

which directs OIGs to conduct an evaluation using the OIG FISMA metrics. 

The metrics consisted of eight domains aligned with the five functional 

areas (identify, protect, detect, respond, and recover) from the National 

Institute of Standards and Technology Framework for Improving Critical 

Infrastructure Cybersecurity. 

HUD’s information security program was evaluated as not effective based 

on the fiscal year 2020 Inspectors General FISMA metrics. Key components 

of HUD’s information security program remain ineffective or have 

inconsistent processes throughout the HUD program offices and among 

their IT contracts. 

HUD continued to address recommendations that OIG made in previous 

years. HUD’s Office of the Chief Information Officer had success in 

modernizing some of the HUD infrastructure and moving applications to 

modern technology. OIG recommend that HUD continue to address all 

outstanding FISMA recommendations and refine and further implement 

its IT strategic modernization roadmap. OIG made 26 recommendations 

to assist HUD in increasing its information security posture. OIG has 

determined that the contents of this report would not be appropriate for 

public disclosure and has, therefore, limited its distribution to selected 

officials. Evaluation report: 2020-OE-0001

195 USCA App. 3, section 5(a)(22)

93 APPENDIX 3 – INSPECTOR GENERAL EMPOWERMENT ACT I HUD OIG Semiannual Report to Congress
APPENDIX 4 - REPORTING REQUIREMENTS

The specific reporting requirements as prescribed by the Inspector General Act of 1978, as amended by the Inspector General Act of 1988, 

are listed below.

Source requirement Pages

Section 4(a)(2)-review of existing and proposed legislation and regulations. 23-34

Section 5(a)(1)-description of significant problems, abuses, and deficiencies relating to the 

administration of programs and operations of the Department.

10-19

49-50

Section 5(a)(2)-description of recommendations for corrective action with respect to 

significant problems, abuses, and deficiencies. 32-48

Section 5(a)(3)-identification of each significant recommendation described in previous 

Semiannual Report on which corrective action has not been completed.

Appendix 2, 

Table B, 59

Section 5(a)(4)-summary of matters referred to prosecutive authorities and the prosecutions 

and convictions that have resulted. 10-19

Section 5(a)(5)-summary of reports made on instances where information or assistance was 

unreasonably refused or not provided, as required by Section 6(b)(2) of the Act. No instances

94 APPENDIX 4 – REPORTING REQUIREMENTS I HUD OIG Semiannual Report to Congress
Source requirement Pages

Section 5(a)(6)-listing of each audit report completed during the reporting period, and for 

each report, where applicable, the total dollar value of questioned and unsupported costs and 

the dollar value of recommendations that funds be put to better use.

Appendix 1, 

53

Section 5(a)(7)-summary of each particularly significant report. 10-19

Section 5(a)(8)-statistical tables showing the total number of audit reports and the total dollar 

value of questioned and unsupported costs.

Appendix 2, 

table C, 83

Section 5(a)(9)-statistical tables showing the total number of audit reports and the dollar value 

of recommendations that funds be put to better use by management.

Appendix 2, 

table D, 85

Section 5(a)(10)-summary of each audit report issued before the commencement of the reporting 

period for which no management decision had been made by the end of the period.

Appendix 2, 

table A, 56

Section 5(a)(11)-a description and explanation of the reasons for any significant revised 

management decisions made during the reporting period. 42-46

Section 5(a)(12)-information concerning any significant management decision with which the 

Inspector General is in disagreement. 46-47

Section 5(a)(13)-the information described under section 05(b) of the Federal Financial 

Management Improvement Act of 1996. 48

95 APPENDIX 4 – REPORTING REQUIREMENTS I HUD OIG Semiannual Report to Congress
APPENDIX 5 - ACRONYMS AND ABBREVIATIONS

AMAD...................................Accounting, Monitoring, and Analysis Division

CARES Act..................Coronavirus Aid, Relief, and Economic Security Act

CDBG....................................................Community Development Block Grant

CDBG-DR.......Community Development Block Grant Disaster Recovery

CFPB.......................................................Consumer Finance Protection Bureau

CFR............................................................................Code of Federal Regulations

CIGIE.........Council of the Inspectors General on Integrity and Efficiency

CPD..................................Office of Community Planning and Development

CPI-U...................................Consumer Price Index for All Urban Consumers

CSP...............................................................COVID-19 supplemental payments

DEC..............................................................Departmental Enforcement Center

DEFC.....................................................................disaster emergency fund code

DHS......................................................U.S. Department of Homeland Security

DoD............................................................................U.S. Department of Defense

DOT...............................................................U.S. Department of Transportation

FBI........................................................................Federal Bureau of Investigation

FFMIA.............................Federal Financial Management Improvement Act

FHA....................................................................Federal Housing Administration

FHFA................................................................Federal Housing Finance Agency

FISMA................Federal Information Security Modernization Act of 2014

FR.......................................................................................................Federal Register

GAO......................................................U.S. Government Accountability Office

HAP...........................................................................housing assistance payment

HCAMS........................Housing Counseling Agency Management System

HECM..........................................................home equity conversion mortgage

HOEPA........................Homeownership and Equity Protection Act of 1994

HOPWA.................................Housing Opportunities for Persons With AIDS

HUD........................U.S. Department of Housing and Urban Development

IGEA...........................................................Inspector General Empowerment Act

IT..............................................................................................information technology

iTED............................................Information Technology Evaluations Division

LOS........................................................................................Loan Origination System

ML..........................................................................................................mortgagee letter

MRB.....................................................................................Mortgagee Review Board

OBGA.....................................................................Office of Block Grant Assistance

OCFO..............................................................Office of the Chief Financial Officer

OCHCO..............................................Office of the Chief Human Capital Officer

OCIO.........................................................Office of the Chief Information Officer

96 APPENDIX 5 – ACRONYMS AND ABBREVIATIONS I HUD OIG Semiannual Report to Congress
OCPO.....................................................Office of the Chief Procurement Officer

OE.....................................................................................................Office of Evaluation

OGC.........................................................................................Office of General Counsel

OI.....................................................................................................Office of Investigation

OIG........................................................................................Office of Inspector General

OMB......................................................................Office of Management and Budget

ONAP..................................................................Office of Native American Programs

OSSE............................................Office of the State Superintendent of Education

PBV..............................................................................Project-Based Voucher Program

PD&R...................................................Office of Policy Development and Research

PHA...............................................................................................public housing agency

PIH........................................................................Office of Public and Indian Housing 

PRAC............................................Pandemic Response Accountability Committee

PRWORA................................................................Personal Responsibility and Work 

Opportunity Reconciliation Act

RAD........................................................Rental Assistance Demonstration Program

RHP......................................................................................Recovery Housing Program

SAM.............................................................................System for Award Management

SAR..............................................................................Semiannual Report to Congress

SFDMS.....................................................Single Family Default Monitoring System

SGHDC........................Southwest Georgia Housing Development Corporation

U.S.C....................................................................................................United States Code

VMS................................................................................Voucher Management System

97 APPENDIX 5 – ACRONYMS AND ABBREVIATIONS I HUD OIG Semiannual Report to Congress
APPENDIX 6 - OIG TELEPHONE DIRECTORY

OFFICE OF AUDIT

Headquarters Washington, DC 202-708-0364

Region 1 Boston, MA 617-994-8380

 Hartford, CT 860-240-9739

Region 2 New York, NY 212-264-4174

 Buffalo, NY 716-551-5755

 Newark, NJ 973-622-7900

Region 3 Philadelphia, PA 215-656-0500

 Baltimore, MD 410-962-2520

 Pittsburgh, PA 412-644-6428

 Richmond, VA 804-771-2100

Region 4 Atlanta, GA 404-331-3369

 Greensboro, NC 336-547-4001

 Miami, FL 305-536-5387

 San Juan, PR 787-766-5540

Region 5 Chicago, IL 312-913-8499

 Columbus, OH 614-280-6138

 Detroit, MI 313-226-6190

Region 6 Fort Worth, TX 817-978-9309

 Baton Rouge, LA 225-448-3975

 Houston, TX 713-718-3199

 New Orleans, LA 504-671-3000

 Oklahoma City, OK 405-609-8606

 San Antonio, TX 210-475-6800

REGION 7-8-10 Kansas City, KS 913-551-5870

 St. Louis, MO 314-539-6339

 Denver, CO 303-672-5475

REGION 9 Los Angeles, CA 213-894-8016

 Las Vegas, NV 702-366-2100

 Phoenix, AZ 602-379-7250

 San Francisco, CA 415-489-6400

Headquarters Washington, DC 202-708-0430

OFFICE OF EVALUATION

98 APPENDIX 6 – OIG TELEPHONE DIRECTORY I HUD OIG Semiannual Report to Congress
OFFICE OF INVESTIGATION

Headquarters Washington, DC 202-708-0390

Region 1-2 New York, NY 212-264-8062

 Boston, MA 617-994-8450

 Hartford, CT 860-240-4800

 Manchester, NH 603-666-7988

 Newark, NJ 973-776-7342

Region 3 Philadelphia, PA 215-861-7676

 Baltimore, MD 410-209-6594

 Pittsburgh, PA 412-644-2857

 Richmond, VA 804-822-4890

Region 4 Atlanta, GA 404-331-5001

 Greensboro, NC 336-547-4000

 Miami, FL 305-536-3087

 San Juan, PR 787-766-5872

Region 5 Chicago, IL 312-353-4196

 Cleveland, OH 216-357-7800

 Columbus, OH 614-280-6137

 Detroit, MI 313-226-6280

Minneapolis- 612-370-3130

St. Paul, MN

Region 6 Fort Worth, TX 817-978-5440

 Baton Rouge, LA 225-448-3941

 Houston, TX 713-718-3097

 New Orleans, LA 504-671-3700

Region 7-8 Denver, CO 303-672-5350

 Kansas City, KS 913-551-5566

 Salt Lake City, UT 801-524-6090

 St. Louis, MO 314-539-6559

Region 9-10 Los Angeles, CA 213-894-8000

 Las Vegas, NV 702-366-2144

 Phoenix, AZ 602-379-7251

 San Francisco, CA 415-489-6400

99 APPENDIX 6 – OIG TELEPHONE DIRECTORY I HUD OIG Semiannual Report to Congress
Diversity and Equal Opportunity

The promotion of high standards and equal employment opportunity for

employees and job applicants at all levels. HUD OIG reaffirms its commitment

to nondiscrimination in the workplace and the recruitment of qualified employees

without prejudice regarding their gender, race, religion, color, national origin,

sexual orientation, disability, or other classification protected by law. HUD OIG

is committed and proactive in the prevention of discrimination and ensuring

freedom from retaliation for participating in the equal employment opportunity

process in accordance with departmental policies and procedures.

100 HUD OIG Semiannual Report to Congress
Report fraud, waste, and mismanagement

in HUD programs and operations by

Calling the HUD OIG hotline: 

1-800-347-3735

Visiting online at

https://www.hudoig.gov/hotline

Scan to Report Fraud

www.hudoig.gov

Report #86