Alexandria Housing Authority - Agreed upon Procedures

Published by the Department of Housing and Urban Development, Office of Inspector General on 2000-04-26.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                                       U.S. Department of Housing and Urban Development
                                                       Southwest District Office of Inspector General
                                                       819 Taylor Street, Room 13A09
                                                       Fort Worth, Texas 76102

                                                       (817) 978-9309 FAX (817) 978-9316

April 26, 2000                                         00-FW-202-1802

MEMORANDUM FOR: Judy Wojciechowski, Director
                Troubled Agency Recovery Team 2, PB2

FROM: D. Michael Beard, District Inspector General for Audit, 6AGA

SUBJECT: Alexandria Housing Authority - Agreed upon procedures

      On June 7, 1999, I agreed with HUD New Orleans Field Office’s recommendation that the
Alexandria Housing Authority (Authority) retain an Independent Public Accountant to perform an
Agreed Upon Procedures audit of the Authority’s administration/management and operations.

        The Authority retained William Daniel McCaskill, CPA to perform the agreed upon
procedures. The CPA issued his final report on December 6, 1999. The report addresses serious
problems at the Authority. Furthermore, the New Orleans Field Office sent the Authority a
memorandum, dated March 1, 2000, detailing the required actions needed to correct deficiencies
noted in the report. The New Orleans Field Office has been in the process of clearing these

       The report identified serious internal control weaknesses and mismanagement at the
Authority including: 1

           •   Potential leave abuse by the former Executive Director;
           •   Not following procurement requirements;
           •   Lack of controls over fixed assets and property disposition;
           •   Lack of controls over inventory;
           •   Dispute with the City over its payments in lieu of taxes;
           •   Questionable payments made for the former Executive Director’s annuity; and
           •   Misallocation of costs among its various programs.

       The above conditions jeopardize the effective and efficient operation of the Authority and
make the Authority susceptible to waste and abuse. As a result, we have decided to control the
following recommendations under the Departmental Automated Audits Management System
(DAAMS). We have made recommendations that address the conditions cited in the report.
Furthermore, we have made the recommendation that HUD take administrative action against the

    We have attached a copy of the report.

former Executive Director. We base this recommendation upon the appearance that the former
Executive Director abused his leave. The former Executive Director may have directed staff to
pay for his annuity benefits, which were substantially more than the benefits paid for other
employees. These conditions demonstrate a lack of business integrity on the part of the former
Executive Director.2 Also, we attribute many of the problems identified in the report to the
Executive Director’s management of the Authority. We believe his actions or his failure to take
appropriate actions indicate a violation of HUD requirements so serious to as to affect the integrity
of the Authority’s operations.3

We recommend that HUD:

1A.       Take immediate administrative sanctions against the former Executive Director.

1B.       Ensure that the Authority follows all applicable procurement requirements.

1C.       Require the Authority to determine the appropriate amount of annual leave owed to the
          former Executive Director and take necessary measures to recapture any overpayments
          made to the former Executive Director.

1D.       Require the Authority to maintain accurate leave balances for all employees, including
          senior management and ensure that the Authority’s Board Chairman approves all leave of
          the Executive Director.

1E.       Require the Authority to establish, implement, and maintain accurate controls over its fixed
          assets and inventories.

1F.       Ensure that the Authority complied with the Internal Revenue Service requirements relating
          to payments made for the former Executive Director’s annuity.

1G.       Require the Authority to reimburse HUD programs for any excess or ineligible payments
          made for the former Executive Director’s annuity.

1H.       Require the Authority to resolve its dispute with the City over its payments in lieu of taxes.

1I.       Require the Authority to properly allocate insurance costs between its programs. If the
          Authority has used HUD program funds to improperly pay the insurance costs on properties
          not included under the Annual Contributions Contract, the Authority should reimburse HUD
          programs for the amounts.

1J.       Require the Authority to properly allocate costs among the various programs that it

                                            *    *     *    *

    24 CFR 24.305(a)(4)
    24 CFR 24.305(b)

          Within 60 days, please furnish this office, for each recommendation made in this
memorandum report, a status report on: (1) corrective action taken; (2) proposed corrective action
and date to be completed; or (3) why action is considered unnecessary. Also, please furnish us
copies of any correspondence or directives issued because of this review.
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                                                                                  Attachment 2

Secretary's Representative, 6AS
Comptroller, 6AF
Director, Accounting, 6AAF
Director, Office of Public Housing, 6APH
Office of Public Housing, 6HPH
Saul N. Ramirez, Jr., Deputy Secretary, SD (Room 10100)
Kevin Simpson, Deputy General Counsel, CB (Room 10214)
Jon Cowan, Chief of Staff, S (Room 10000)
B. J. Thornberry, Special Asst. to the Deputy Secretary for Project Management, SD (Rm 10100)
Joseph Smith, Acting Assistant Secretary for Administration, A (Room 10110)
Hal C. DeCell III, A/S for Congressional and Intergovernmental Relations, J (Room 10120)
Ginny Terzano, Sr. Advisor to the Secretary, Office of Public Affairs, S (Room 10132)
Roger Chiang, Director of Scheduling and Advance, AL (Room 10158)
Howard Glaser, Counselor to the Secretary, S (Room 10218)
Rhoda Glickman, Deputy Chief of Staff, S (Room 10226)
Todd Howe, Deputy Chief of Staff for Operations, S (Room 10226)
Jacquie Lawing, Deputy Chief of Staff for Programs & Policy, S (Room 10226)
Patricia Enright, Deputy A/S for Public Affairs, W (Room 10222)
Joseph Hacala, Special Asst for Inter-Faith Community Outreach, S (Room 10222)
Marcella Belt, Executive Officer for Admin Operations and Management, S (Room 10220)
Karen Hinton, Sr. Advisor to the Secretary for Pine Ridge Project (Room 10216)
Gail W. Laster, General Counsel, C (Room 10214)
Armando Falcon, Office of Federal Housing Enterprise Oversight (Room 9100)
William Apgar, Assistant Secretary for Housing/FHA, H (Room 9100)
Susan Wachter, Office of Policy Development and Research (Room 8100)
Cardell Cooper, Assistant Secretary for CPD, D (Room 7100)
George S. Anderson, Office of Ginnie Mae, T (Room 6100)
Eva Plaza, Assistant Secretary for FHEO, E (Room 5100)
V. Stephen Carberry, Chief Procurement Officer, N (Room 5184)
Harold Lucas, Assistant Secretary for Public & Indian Housing, P (Room 4100)
Gloria R. Parker, Chief Information Officer, Q (Room 8206, L’Enfant Plaza)
Frank L. Davis, Director, Office of Dept Operations and Coordination, I (Room 2124)
Office of the Chief Financial Officer, F (Room 2202)
Edward Kraus, Director, Enforcement Center, V, 200 Portals Bldg., Wash. D.C. 20024
Donald J. LaVoy, Acting Director, REAC, X, 800 Portals Bldg., Wash. D.C. 20024
Ira Peppercorn, Director, Office of MF Asst Restructuring, Y, 4000 Portals Bldg., D.C. 20024
Mary Madden, Assistant Deputy Secretary for Field Policy & Mgmt, SDF (Room 7108) (2)
Deputy Chief Financial Officer for Operations, FF (Room 2202)
David Gibbons, Director, Office of Budget, FO (Room 3270)
Public Housing ALO, PF (Room 5156) (2)
Dept. ALO, FM (Room 2206) (2)
Acquisitions Librarian, Library, AS (Room 8141)
                                                                             Attachment 2
                                 DISTRIBUTION (Cont’d)

Director, Hsg. & Comm. Devel. Issues, US GAO, 441 G St. NW, Room 2474
     Washington, DC 20548 Attn: Judy England-Joseph
Henry A. Waxman, Ranking Member, Committee on Govt Reform,
     House of Rep., Washington, D.C. 20515
The Honorable Fred Thompson, Chairman, Committee on Govt Affairs,
     U.S. Senate, Washington, D.C. 20510
The Honorable Joseph Lieberman, Ranking Member, Committee on Govt Affairs,
     U.S. Senate, Washington, D.C. 20510
Cindy Fogleman, Subcomm. on Gen. Oversight & Invest., Room 212,
     O'Neill House Ofc. Bldg., Washington, D.C. 20515
The Honorable Dan Burton, Chairman, Committee on Govt Reform,
     House of Representatives, Washington, D.C. 20515
Deputy Staff Director, Counsel, Subcommittee on Criminal Justice, Drug Policy & Human
     Resources, B373 Rayburn House Ofc. Bldg., Washington, D.C. 20515
Steve Redburn, Chief, Housing Branch, Office of Management and Budget
     725 17th Street, NW, Room 9226, New Exec. Ofc. Bldg., Washington, D.C. 20503
Inspector General, G
Housing Authority of the City of Alexandria
McCaskill, CPA