U.S. Department of Housing and Urban Development
Office of Inspector General for Audit, Midwest
77 West Jackson Boulevard, Room 2646
Chicago, Illinois 60604-3507
Phone (312) 353-7832 Fax (312) 353-8866
Internet http//www.hud.gov/oig/oigindex.html
AUDIT MEMORANDUM
2002-CH-1801
January 29, 2002
MEMORANDUM FOR: Thomas S. Marshall, Director of Public Housing Hub, Cleveland
Area Office
FROM: Heath Wolfe, District Inspector General for Audit, Midwest
SUBJECT: Housing Authority Of The City Of Evansville
Hotline Complaint
Evansville, Indiana
We completed a review of the Housing Authority of the City of Evansville. The review resulted from an
anonymous complaint to our Hotline. The objectives of our audit were to determine whether the
complainant’s allegations were substantiated and whether HUD’s rules and regulations were followed.
The complainant’s specific allegations were: (1) the Housing Authority’s former Chief Executive Officer
committed racial and sexual discrimination, and harassment against the Authority’s residents and
employees, and minority owned businesses; (2) the Authority’s Board of Commissioners and its former
Chief Executive Officer conducted a smear campaign against members of the Evansville community with
the intent to slander and diminish the financial opportunities available to the members; (3) the Authority’s
Interim Director of Section 8 and Staff Attorney violated community members’ and Authority
employees’ civil rights; (4) the Authority and its corporations failed to follow applicable procurement
requirements in the award of contracts for the demolition of Lincoln Gardens, development of Lincoln
Estates, and the cleaning of the Authority’s housing units; and (5) the Authority improperly established
corporations. The complainant also alleged that the Authority misused funds by allowing the: (1)
abandonment of the renovation to the Authority’s former offices, and the purchase and renovation of
property located at 500 Court Street for the Authority’s new offices; (2) Authority’s former Chief
Executive Officer to live in the penthouse apartment located at 500 Court Street and to utilize the
Authority’s basement for his own personal use; (3) demolition of Lincoln Gardens when financing for the
construction of Lincoln Estates was not determined; (4) sale of the property where Lincoln Gardens
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Management Memorandum
was located to one of the Authority’s corporations; (5) residence located at 620 Washington Avenue,
which was planned to provide housing for people with AID’s, not to be established after the property
was purchased and allowed stained glass windows to be removed from the property at the request of
the Authority’s former Chief Executive Officer and a Commissioner; (6) the Authority’s playground
equipment to be moved to a school where one of the Authority’s Commissioners was principal, rather
than to a church who requested the equipment; (7) threat of eminent domain to purchase property for a
community shopping center; and (8) the Authority’s former Chief Executive Officer and Interim Director
of Section 8 to receive pay raises that were excessive.
The Housing Authority was established under the laws of the State of Indiana. A seven member Board
of Commissioners governs the Housing Authority. The former Chairman of the Board is Jack Buttrum.
His term expired on December 31, 2001. The Authority’s Board has not elected a new Chairman as of
January 23, 2002. The Board’s Vice Chairman is Lu Porter. During our audit, the Authority’s former
Chief Executive Officer John W. Collier resigned effective February 2, 2001. The Authority’s current
Executive Director is Paul L. Fletcher. The Authority’s books and records are located at 500 Court
Street, Evansville, Indiana.
As of October 17, 2001, the Housing Authority operated seven HUD programs: (1) a Public Housing
Program consisting of 1,049 units; (2) a Section 8 Program consisting of 1,612 units; (3) a
Comprehensive Grant Program; (4) a Public Housing Drug Elimination Grant Program; (5) an Economic
Development and Supportive Services Grant Program; (6) a Resident Opportunities for Self Sufficiency
Grant Program; and (7) a Homebuyers Program. The Authority also operated six non-HUD programs:
(1) a Subsidized Housing Program; (2) a Development Fund Program; (3) a Youth Sport Grant
Program; (4) a Substance Abuse Council Grant Program; (5) an Arts Grant Program; and (6) the
Washington Court Program.
To accomplish our audit objectives, we interviewed: HUD’s staff; State of Indiana and City of
Evansville officials; the Authority’s current and former Commissioners, current and former employees,
and contractors; and members of the Evansville community. We analyzed the Authority’s: audited
financial statements for the periods ending December 31, 1998 and December 31, 1999; meeting
minutes of its Board of Commissioners; By-Laws; Articles of Incorporation; Certificates of Limited
Partnership; Agreements of Limited Partnership; cancelled checks; purchase orders; vendor and
contractor files; Accounts Payable Invoice History Listings; Accounts Payable Listings; bank
statements; journal entries; Section 8 Program tenant files; Annual Statement/Performance and
Evaluation Report on Replacement Reserve and Five-Year Action Plan for the Comprehensive Grant
Program; the HOPE I Program files; personnel files; Fiscal Year 2000 cost allocation plan; and policies
and procedures.
We also reviewed: HUD’s files for the Authority; Parts 24, 85, 963, and 968 of Title 24 of the Code of
Federal Regulations; Office of Management and Budget Circular A-87; the Consolidated Annual
Contributions Contract between HUD and the Authority; the Section 8 Annual Contributions Contract
for the Rental Certificate and Rental Voucher Programs between HUD and the Authority; the
November 1990 Public Housing Agency Commissioners Program Integrity Bulletin; HUD Handbook
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Audit Memorandum
1378.0; HOPE I Implementation Grant Agreement between HUD and the Authority; and Title 36 of the
Indiana Code. We judgmentally selected 11 of the Housing Authority’s employees whose salaries were
charged to the Authority’s various programs to determine the time they spent related to the programs.
We did not address three of the complainant’s allegations since they related to issues that are not in the
scope of our authority. The three allegations were: the Housing Authority’s former Chief Executive
Officer committed racial and sexual discrimination, and harassment against the Authority’s residents and
employees, and minority owned businesses; the Authority’s Board of Commissioners and its former
Chief Executive Officer conducted a smear campaign against members of the Evansville community with
the intent to slander and diminish the financial opportunities available to the members; and the
Authority’s Interim Director of Section 8 and Staff Attorney violated community members’ and
Authority employees’ civil rights.
We found that the Housing Authority’s former and current management staff, and its Board of
Commissioners did not sufficiently exercise their responsibilities to effectively manage the Authority.
Specifically, the Housing Authority’s management staff and/or its Commissioners: (1) misused $911,283
in funds (HOPE I sales proceeds and Comprehensive Grant Program) to purchase and renovate its
administration building; (2) improperly awarded three consulting contracts worth over $70,000 and
$10,368 in fringe benefits to its former Chief Executive Officer; (3) awarded five cleaning contracts that
totaled $199,605 without full and open competition and/or when conflicts of interest existed; (4)
inappropriately acquired, developed, and disposed of property for the Emporia Project; (5) did not
exercise sound management practices over steel purchased for construction work; and (6) did not
establish an acceptable cost allocation plan to support the allocation of costs among the Authority’s
programs. As a result, HUD lacks assurance that the Housing Authority’s resources were used to the
maximum extent to benefit low and moderate income tenants.
We presented our draft findings to the Housing Authority’s current Executive Director and HUD’s staff
during the audit. We held an exit conference with the Authority’s Executive Director and former
Chairman of the Board on November 2, 2001. The Authority provided written comments to our
findings. The Authority agreed with all of the draft findings. The complete text of the Housing
Authority’s comments is in Appendix B with the exception of eight attachments/exhibits that were not
necessary for understanding the Authority’s comments. A complete copy of the Authority’s responses
with the attachments/exhibits was provided to HUD’s Director of the Cleveland Area Office of Public
Housing Hub. A copy of this memorandum was provided to the Authority’s Executive Director and
Vice Chairman of the Board.
Within 60 days, please provide us, for each recommendation made in this memorandum, a status report
on: (1) the corrective action taken; (2) the proposed corrective action and the date to be completed; or
(3) why action is considered unnecessary. Also, please furnish us copies of any correspondence or
directives issued because of the audit.
Should you or your staff have any questions, please have them contact me at (312) 353-7832.
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Finding 1
The Housing Authority Was Not Operated
According To Program Requirements
The Housing Authority of the City of Evansville’s former and current management staff, and its
Board of Commissioners did not sufficiently exercise their responsibilities to effectively manage
the Housing Authority. Specifically, the Housing Authority’s management staff and/or its
Commissioners: (1) misused $911,283 in funds (HOPE I sales proceeds and Comprehensive
Grant Program) to purchase and renovate its administration building; (2) improperly awarded
consulting contracts and fringe benefits to its former Chief Executive Officer; (3) awarded five
cleaning contracts without full and open competition and/or when conflicts of interest existed;
(4) inappropriately acquired, developed, and disposed of property for the Emporia Project; (5)
did not exercise sound management practices over steel purchased for construction work; and
(6) did not establish an acceptable cost allocation plan to support the allocation of costs among
the Authority’s programs. The Housing Authority’s former and current management staff, and
its Board of Commissioners were not aware of Federal requirements, State of Indiana law, and
the Housing Authority’s policies to ensure the Authority was operated according to program
requirements. As a result, HUD lacks assurance that the Housing Authority’s resources were
used to the maximum extent to benefit low and moderate income tenants.
24 CFR Part 24.110 permits HUD to take
HUD’s Regulations administrative sanctions against employees and board
members of recipients under HUD assistance
agreements that violate HUD’s requirements. The
sanctions include debarment, suspension, or limited
denial of participation and are authorized by 24 CFR
Parts 24.300, 24.400, or 24.700, respectively. HUD
may impose administrative sanctions based upon the
following conditions:
• Failure to honor contractual obligations or to
proceed in accordance with contract
specifications or HUD regulations (limited
denial of participation);
• Violation of any law, regulation, or procedure
relating to the application for financial
assistance, insurance or guarantee, or to the
performance of obligations incurred pursuant to
a grant of financial assistance or pursuant to a
conditional or final commitment to insure or
guarantee (limited denial of participation);
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Finding 1
• Violation of the terms of a public agreement or
transaction so serious as to affect the integrity of
an agency program such as a history of failure
to perform or unsatisfactory performance of
one or more public agreements or transactions
(debarment);
• Any other cause so serious or compelling in
nature that it affects the present responsibility of
a person (debarment); or
• Material violation of a statutory or regulatory
provision or program requirements applicable
to a public agreement or transaction including
applications for grants, financial assistance,
insurance or guarantees, or to the performance
of requirements under a grant, assistance
award, or conditional or final commitment to
insure or guarantee (debarment).
Public Housing Authority Commissioners have a
Responsibilities Of Board responsibility to HUD to ensure national housing
Of Commissioners And policies are carried out, and to the Authority’s
Management Staff management staff and employees to provide sound and
manageable directives. The Commissioners are
accountable to their locality and best serve it by
monitoring operations to be certain that housing
programs are carried out in an efficient and economical
manner.
The responsibility for carrying out the Commissioners'
policies and managing the Housing Authority's day-to-
day operations rests with the Authority’s principal
management staff. In particular, the management staff
must maintain the Housing Authority's overall
compliance with its policies and procedures and
Federal, State, and local laws.
The Housing Authority’s former Chief Executive Officer
Funds Were Misspent To and former Director of Operations did not follow the
Purchase And Renovate HOPE I Implementation Grant Agreement, HUD’s
The Administration Building regulations, and the Consolidated Annual Contributions
Contract regarding the use of funds for the Authority’s
administration building. The Housing Authority
improperly used HOPE I sales proceeds to purchase
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Finding 1
the building located at 500 Court Street for its
administration offices. The Authority also misused
Comprehensive Grant Program funds to renovate the
building after it was purchased (See Finding 2).
The Housing Authority’s Board of Commissioners
The Authority’s Former failed to ensure that HUD’s regulations, Office of
Chief Executive Officer Management and Budget Circular A-87, the
Inappropriately Received Consolidated Annual Contributions Contract, the
Consulting Contracts And Section 8 Annual Contributions Contract, State of
Fringe Benefits Indiana law, and/or the Authority’s policies were
followed regarding contracts with and payments to its
former Chief Executive Officer. Specifically, the
Housing Authority and Washington Court
Redevelopment Corporation, a non-profit organization
established by the Authority to provide housing to low
and moderate income individuals, improperly awarded
consulting contracts to the Authority’s former Chief
Executive Officer. The Housing Authority also paid its
former Chief Executive Officer $10,368 for monetized
vacation time, sick leave, and personal leave. The
payment of the monetized time and leave was not
reasonable and necessary to the Housing Authority’s
operations (See Finding 3).
The Housing Authority’s former Chief Executive
The Authority’s Contracting Officer, current Director of Asset Management, and a
Process Needs To Be current Commissioner did not ensure that the Authority
Improved followed HUD’s regulations, the Consolidated Annual
Contributions Contract, State of Indiana law, and the
Authority’s Procurement Policy regarding the award of
cleaning services for its housing units and offices. The
Housing Authority awarded two contracts for cleaning
services when conflicts of interest existed. The Housing
Authority also did not competitively award three
cleaning contracts to a resident-owned business (See
Finding 4).
The Housing Authority’s former Chief Executive Officer
The Authority’s Actions and the current Interim Director of Section 8 did not
Regarding The Emporia follow HUD’s regulations, the Consolidated Annual
Project Were Improper Contributions Contract, and/or HUD Handbook
1378.0 regarding the acquisition, development, and
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Finding 1
disposition of property for the Emporia Project.
Specifically, the Housing Authority: improperly used
HUD funds to acquire, develop, and dispose of
property; misused its eminent domain authority related
to the purchase of property; and failed to publicly solicit
bids when it disposed of the property. The Housing
Authority also failed to obtain HUD’s approval to
acquire and sell the property (See Finding 5).
The Housing Authority’s former Chief Executive Officer
Sound Management and its current Director of Special Programs did not
Practices Were Not follow HUD’s regulation, Office of Management and
Exercised By The Authority Budget Circular A-87, and the Consolidated Annual
Over Its Construction Steel Contributions Contract regarding steel purchased for
construction work. Specifically, the Housing Authority
used $17,278 in Comprehensive Grant Program funds
to purchase the steel for construction work on its
former administration offices located at 411 South East
8th Street. The Housing Authority stopped the work
because it purchased a building located at 500 Court
Street for its offices. As of July 2001, the Housing
Authority had not made a decision regarding the unused
steel. In addition, $1,730 in steel decking rusted and
was discarded because it was not fit for use (See
Finding 6).
The Housing Authority’s former Chief Executive Officer
A Cost Allocation Plan Was and its current Director of Finance did not follow
Not Established To HUD’s regulation and Office of Management and
Sufficiently Allocate Costs Budget Circular A-87 regarding the establishment of an
To The Authority’s Various acceptable cost allocation plan to support the allocation
Programs of costs among the Authority’s programs. Specifically,
the Housing Authority did not charge employees’
salaries and fringe benefits to all of the Authority’s
programs that received their services. The Authority
also failed to allocate non-salary costs to its various
programs (See Finding 7).
The Housing Authority’s former and current
The Authority’s Staff And management staff, and its Board of Commissioners
Board Were Not Aware Of lacked procedures and controls over its programs to
Program Requirements ensure that they were operated according to Federal
requirements, State of Indiana law, and the Authority’s
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Finding 1
policies. The management staff included the Housing
Authority’s: former Chief Executive Officer who
consults to various public housing authorities; the former
Director of Operations who is now Deputy Executive
Director of the Rochester Housing Authority in
Rochester, New York; the current Director of Asset
Management; the current Interim Director of Section 8;
the current Director of Special Programs; and the
current Director of Finance. In these capacities, the
current and former management staff controls a
substantial portion of or can influence the use of HUD
funds. As a result of the actions or inactions by the
Housing Authority’s former and current management
staff and its Board of Commissioners, HUD lacks
assurance that the Housing Authority’s resources were
used to the maximum extent to benefit low and
moderate income tenants.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 48 and 49, contains the complete text of the
comments.]
The Housing Authority agrees that its former and
current management staff did not sufficiently exercise
their responsibilities to effectively manage the Authority.
The Housing Authority also agrees that tis Board of
Commissioners did not effectively monitor the
operations of the Authority’s staff. Therefore, the
Housing Authority will obtain training for: its current
management staff regarding Federal requirements, State
of Indiana law, and the Authority’s policies so that its
programs are operated correctly; and its Board of
Commissioners regarding their roles and responsibilities
in monitoring the Authority’s operations.
The Housing Authority supports the OIG’s
recommendation that HUD consider taking appropriate
administrative action against the Authority’s former
Chief Executive Officer and former Director of
Operations.
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Finding 1
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should improve its management staff and
Board of Commissioners’ administration of the
Authority’s programs.
Recommendations We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
1A. Obtains training for its current management staff
regarding Federal requirements, State of
Indiana law, and the Authority’s policies so that
its programs are operated correctly.
1B. Obtains training for its Board of Commissioners
regarding their roles and responsibilities in
monitoring the Authority’s operations. If the
Commissioners fail to improve their monitoring
efforts, HUD should consider taking
administrative sanctions against the applicable
Commissioners as permitted by 24 CFR Part
24.
We also recommend that the Director of the Cleveland
Area Office of Public Housing Hub:
1C. Take appropriate administrative action against
the Housing Authority’s former Chief Executive
Officer and former Director of Operations as
permitted by 24 CFR Part 24.
.
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Finding 2
The Authority Misspent Funds To Purchase
And Renovate Its Administration Building
The Housing Authority of the City of Evansville did not follow Federal requirements regarding
the use of funds for its administration building. Specifically, the Housing Authority improperly
used $750,000 in HOPE I sales proceeds to purchase the building located at 500 Court Street
for its administration offices. The Authority also misused $161,283 in Comprehensive Grant
Program funds to renovate the building after it was purchased. According to the Housing
Authority’s former Chief Executive Officer and the former Director of Operations, they were
not aware that the Authority was prohibited from using HOPE I sales proceeds and
Comprehensive Grant Program funds to purchase or renovate the building. As a result, funds
were not used in an efficient and effective manner.
The HOPE I Implementation Grant Agreement,
Federal Requirements between HUD and the Housing Authority of the City of
Evansville, required the Housing Authority to use sales
proceeds from the initial sale of units to eligible families
for the cost of a homeownership program. The costs
include operating expenses, improvements to the
project, business opportunities for low-income families,
supportive services related to the homeownership
program, additional homeownership opportunities, and
other activities approved by HUD, either as part of the
approved application or as subsequently approved by
HUD.
24 CFR Part 968.125 requires that after HUD
approves a public housing authority’s modernization
program and enters into an Annual Contributions
Contract amendment with the authority, the authority
will under take the modernization activities and
expenditures set forth in its Comprehensive Grant
Program Annual Statement/Five-Year Action Plan.
24 CFR Part 968.105 defines a modernization project
as the improvement of one or more existing public
housing developments under a unique number
designated for that modernization program. For each
modernization project, HUD and the public housing
authority will enter into an Annual Contributions
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Finding 2
Contract amendment requiring low-income use of the
housing for not less than 20 years from the date of the
amendment.
Section 9(C)(1) of the Annual Contributions Contract,
between HUD and the Housing Authority of the City of
Evansville, says the Authority may withdraw funds from
the General Fund only for the payment of the costs of
development and operation of the projects under
Contract with HUD.
Contrary to the HOPE I Grant Agreement, the Housing
The Authority Misspent Authority used sales proceeds to purchase its
$750,000 In HOPE I administration building located 500 Court Street.
Proceeds
In October 1994, HUD awarded a $348,381 HOPE I
Grant to the Housing Authority. The Grant was
awarded to provide affordable homeownership to
residents of the Authority. To increase resident
homeownership, the Authority sold 15 Public Housing
units between January 1995 and December 1995.
The Housing Authority received $819,049 in HOPE I
sales proceeds from the sale of the 15 units. The
$819,049 consisted of $721,830 in mortgage proceeds
and $97,219 in HOPE I funds to reimburse the
Authority for closing costs. In January 1997, the
Authority used $750,000 of the HOPE I sales
proceeds to purchase its administration building.
However, the HOPE I Grant Agreement limited the
Housing Authority’s use of the sales proceeds to
funding the Authority’s homeownership initiatives.
The Housing Authority’s former Chief Executive Officer
and the former Director of Operations said they were
not aware that the Authority was prohibited from using
HOPE I sales proceeds to purchase the administration
building. The former Director of Operations said HUD
was aware that the Authority used the sales proceeds to
fund the purchase. However, the former Director did
not notify HUD of the purchase until December 1997,
11 months after the purchase was completed. The
Housing Authority’s notification to HUD’s Indianapolis
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Finding 2
Public Housing Program Center occurred after the
Center requested information from the Authority
regarding the use of the HOPE I sales proceeds to
purchase the building.
HUD’s Indianapolis Public Housing Program Center
conducted a review of the Housing Authority in May
1999. The purpose of the review was to determine
whether the Housing Authority’s use of the HOPE I
sales proceeds was proper and to follow-up on a
citizen complaint against the Authority. HUD’s
Coordinator of the Indianapolis Public Housing
Program Center said his Office concluded that the
Housing Authority improperly used the sales proceeds
to purchase the building. However, he said his Office
did not issue the results of the 1999 review because
OIG planned to conduct an audit of the Housing
Authority.
The Coordinator of HUD’s Indianapolis Public Housing
Program Center said his Office did not approve the
purchase of the building. He also said his Office would
not have approved the use of the HOPE I sales
proceeds to purchase the building if the Authority had
requested HUD’s approval. HUD closed out the
Authority’s HOPE I Grant in April 1997. As a result,
HOPE I sales proceeds were not used in an efficient
and effective manner. The Authority also has fewer
funds to promote resident homeownership.
Contrary to HUD’s regulation and the Annual
The Authority Improperly Contributions Contract, the Housing Authority used
Used Comprehensive Grant Comprehensive Grant Program funds to renovate its
Funds To Renovate Its administration building after the building was purchased.
Administration Building
As previously mentioned, the Housing Authority
purchased a building located at 500 Court Street to
house its administration offices. The purchase was
completed in January 1997. Since the building was
previously a funeral home, the Authority decided to
renovate the building.
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Finding 2
The Housing Authority’s renovation work to the
administration building was not included in its Five-Year
Comprehensive Grant Action Plan dated June 20,
1996. The Housing Authority’s Action Plan included
such items as new computer software and renovation
work of bathrooms and kitchens at the Authority’s
Buckner Towers. All of the items in the Action Plan
were completed.
The renovation work of the Housing Authority’s
administration building occurred between February
1997 and June 1997. The Authority’s maintenance
staff and contractors performed the work. The
Authority used $161,283 in Comprehensive Grant
Program funds to pay for the work. However, the
Housing Authority was not permitted to use Grant funds
to pay for the work since the building was not under the
Annual Contributions Contract with HUD.
HUD’s regulation and the Annual Contributions
Contract require the Housing Authority to use
Comprehensive Grant Program funds to pay for
expenses of projects covered by the Contract. The
Authority’s former Director of Operations said he was
not aware that the Authority was prohibited from using
Grant funds to renovate the administration building. As
a result, the Authority did not use its Grant funds in an
efficient and effective manner.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 51 and 52, contains the complete text of the
comments.]
The Housing Authority agrees that its former Chief
Executive Officer and former Director of Operations
misspent funds to purchase and renovate its
administration building. Therefore, the Housing
Authority will: reimburse HUD from non-Federal funds
for the improper use of the HOPE I sales proceeds to
purchase its administration building or the Authority will
implement a HUD approved plan that will outline the
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Finding 2
use of the non-Federal funds to promote resident
homeownership; reimburse its Comprehensive Grant
Program from non-Federal funds for the improper use
of Grant funds to renovate the administration building;
and (3) implement procedures and controls to ensure
the Authority follows Federal requirements when
purchasing and renovating property.
Additionally, the Housing Authority is seeking to fully
utilize its administration offices. Should the Housing
Authority discover that its more cost effective to
relocate to another facility, the Authority will follow
appropriate procedures and request HUD’s approval
prior to any relocation. The Housing Authority will also:
follow appropriate procedures and promptly request
HUD’s approval prior to any sale or lease of its
administration building; institute a procedure whereby
future property purchases and/or major renovations will
be presented to and reviewed by a three person
committee comprised of the Authority’s Board; and
submit proposed purchases to HUD for final review
and/or approval.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should improve its procedures and
controls to ensure the Authority follows Federal
requirements when purchasing and renovating property.
Recommendations We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
2A. Reimburses HUD $750,000 from non-Federal
funds for the improper use of HOPE I sales
proceeds to purchase its administration building
or implements a plan acceptable to HUD that
outlines the use of the $750,000 in non-Federal
funds to promote resident homeownership.
2B. Reimburses its Comprehensive Grant Program
$161,283 from non-Federal funds for the
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Finding 2
improper use of Grant funds to renovate the
Authority’s administration building.
2C. Implements procedures and controls to ensure
the Authority follows Federal requirements
when purchasing and renovating property.
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Finding 3
The Former Chief Executive Officer
Improperly Received Consulting Contracts
And Fringe Benefits
Contrary to Federal requirements, State of Indiana law, and/or the Housing Authority of the
City of Evansville’s requirements, the Housing Authority’s former Chief Executive Officer
received consulting contracts and fringe benefits. Specifically, the Housing Authority and
Washington Court Redevelopment Corporation awarded professional services contracts to the
Authority’s former Chief Executive Officer when a conflict of interest existed. Washington
Court Redevelopment Corporation is a non-profit entity established by the Housing Authority
and receives Section 8 rental assistance for low-income housing under contracts with the
Authority. The Housing Authority also used $10,368 in HUD funds (Public Housing and
Section 8 Administrative Fees) for unnecessary and unreasonable fringe benefits. The problems
occurred because the Housing Authority lacked procedures and controls to ensure that contract
awards and/or fringe benefits expenses met Federal requirements, State law, and/or the
Authority’s requirements. As a result, HUD funds were not efficiently and effectively used.
HUD and the Housing Authority also lack assurance that contract awards were subject to full
and open competition.
24 CFR Part 85.36(b)(3) states no employee or officer
Federal Requirements of a grantee will participate in the selection, or in the
award or administration of a contract supported by
Federal funds if a conflict of interest, real or apparent,
would be involved. Such a conflict would arise when
the employee or officer has a financial or other interest
in the firm selected for award. Grantee’s officers or
employees are prohibited from accepting anything of
monetary value from its contractors.
24 CFR Part 85.36(b)(9) requires grantees and
subgrantees to maintain records sufficient to detail the
significant history of a procurement, such as the
rationale for the method of procurement and the basis
for the contract price. Part 85.36(c)(1) requires that all
procurement transactions be conducted in a manner
providing full and open competition.
24 CFR Part 85.36(d)(4) states procurement by
noncompetitive proposals may be used only when the
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Finding 3
award of a contract is not feasible under small purchase
procedures, sealed bids, or competitive proposals. In
addition, noncompetitive proposals may only be used
after solicitation of a number of sources and competition
is determined to be insufficient.
Section 19 of Part A of the Consolidated Annual
Contributions Contract, between HUD and the Housing
Authority of the City of Evansville, states the Housing
Authority may not enter into any contract in connection
with a project under this Contract in which any
employee or officer has an interest, direct or indirect,
during his or her tenure or for one year thereafter.
Section 2.13 of the Section 8 Annual Contributions
Contract, between HUD and the Housing Authority of
the City of Evansville, states that neither the Housing
Authority nor any of its contractors may enter into any
contract or arrangement in connection with the Program
in which an employee of the Authority, who formulates
policy or who influences decisions with respect to the
Program, has an interest, direct or indirect, during his or
her tenure or for one year thereafter.
24 CFR Part 85.22(b) requires that State, local, and
Indian tribal governments follow Office of Management
and Budget Circular A-87, Cost Principles for State,
Local, and Indian Tribal Governments. 24 CFR Part
85.3 defines a local government to include any public
housing agency.
Office of Management and Budget Circular A-87,
Attachment A, paragraph C(1)(a), requires that all
costs be necessary and reasonable for proper and
efficient performance and administration of Federal
awards.
Section 36-7-18-11 of the Indiana Code states an
State Of Indiana Law employee of a housing authority may not have any
direct or indirect interest in a contract for services to be
furnished or used in connection with any housing
project.
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Finding 3
Section 1.4(C) of the Housing Authority’s October 21,
Authority’s Requirements 1999 Procurement Policy requires that procurements
other than small purchases (less than $25,000) will be
publicly solicited, an adequate time period will be
provided for the preparation and submission of bids or
proposals, and notice of contract awards will be made
to the public. Section 1.4(D) requires that the Housing
Authority’s solicitations be made in accordance with 24
CFR Part 85.36 and State of Indiana law. Section 1.7
requires the Authority to seek full and open competition
in all of its procurement transactions.
Section 2.4(A) of the Housing Authority’s October
1999 Procurement Policy requires procurements to be
conducted competitively to the maximum extent
possible. Procurements by noncompetitive proposals
may be used only when the award of a contract is not
feasible using small purchase procedures, sealed bids,
or competitive proposals, and one of the following
applies:
• The item is available only from a single source,
based on a good faith review of available
sources;
• An emergency exists that seriously threatens the
public health, welfare, or safety; endangers
property; or would otherwise cause serious
injury to the Housing Authority;
• HUD authorizes the use of noncompetitive
proposals; or
• After solicitation of a number of sources,
competition is determined to be inadequate.
Section 2.4(B) of the Authority’s October 1999
Procurement Policy states procurements based on
noncompetitive proposals will be supported by a
written justification. Section 2.4(C) states the
reasonableness of the price for all procurements based
on noncompetitive proposals will be determined by
performing a cost analysis. Section 6.2 requires the
Authority’s officers and employees to avoid any conflict
of interest in the selection or award of any contract, and
avoid any financial or other conflict of interest.
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Finding 3
Section 18 of Part A of the Housing Assistance
Payments Contracts for Section 8 Tenant-Based
Assistance through HUD’s Rental Voucher Program,
between the Housing Authority of the City of Evansville
and Washington Court Redevelopment Corporation,
prohibits any employee of the Housing Authority who
formulates policy or who influences decisions with
respect to the program from having any direct of
indirect interest in the contract or in any benefits or
payments under the contract, during the employee’s
tenure or for one year thereafter.
The Housing Authority’s 1997 Personnel Manual
provides the necessary guidance to the Authority’s
officials, supervisors, and employees so that everyone
clearly understands what is expected of them. Page
2.17 of the Manual states that sick leave accrued in
excess of 120 days will not be paid. Any sick leave
that is unused at the date of termination of employment
will not be paid. Page 2.18 of the Manual states that an
employee who resigns or is discharged prior to
receiving his earned vacation time will receive pay in lieu
of his vacation. Vacation time may be accumulated
from year to year, but the accumulated vacation time
may not exceed 30 days (240 hours).
Contrary to Federal requirements, State of Indiana law,
Conflicts Of Interest Existed and the Housing Authority’s requirements, the
In Contracts Awarded To Authority’s former Chief Executive Officer was
The Former Chief Executive awarded consulting contracts. The Housing Authority
Officer and/or Washington Court Redevelopment Corporation
awarded professional services contracts to the
Authority’s former Chief Executive Officer between
October 17, 2000 and February 5, 2001. Washington
Court Redevelopment Corporation is a non-profit entity
established by the Housing Authority and receives
Section 8 rental assistance for low-income housing
under contracts with the Authority. A conflict of
interest existed with the former Chief Executive Officer
at the time of the awards since he was an employee or a
former employee of the Housing Authority.
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Finding 3
The Housing Authority executed an October 17, 2000
contract with the former Chief Executive Officer to
retain him as a consultant effective January 1, 2001 or
at the actual hire date of a new Chief Executive Officer
for the Authority. The contract states that the former
Chief Executive Officer will be available on a call as
needed basis for consultation and advice for such
matters as a planned 24 unit senior complex and various
entrepreneurial activities currently underway at the
Authority. Per the contract, the former Chief Executive
Officer was to receive $30,000 for services provided
through December 31, 2001. The contract did not
indicate a specific number of hours to be worked by the
former Chief Executive Officer. As of October 12,
2001, the Authority had not paid the former Chief
Executive Officer for consulting services.
The Housing Authority’s former Chief Executive Officer
resigned from the Authority effective February 2, 2001.
The Authority executed another consulting services
contract with the former Chief Executive Officer
effective February 5, 2001 to serve as the Interim Chief
Executive Officer until a new Chief Executive Officer
was obtained. The contract states that the former Chief
Executive Officer will be responsible for the overall
operations of the Authority. The contract also specifies
that the former Chief Executive Officer will receive
$1,500 to work a minimum of 20 hours per week. As
of October 12, 2001, the Housing Authority had paid
the former Chief Executive Officer $4,500 ($3,375
from Public Housing and $1,125 from Section 8
Administrative Fees) for consulting services under the
February 2001 contract.
Washington Court Redevelopment Corporation
executed a December 18, 2000 contract with the
former Chief Executive Officer to retain him as a
consultant effective February 1, 2001. The contract
states that the former Chief Executive Officer’s duties
will include: establishing the Corporation’s offices; hiring
and firing of staff; overseeing the Corporation’s general
business; and providing other consulting services. Per
the contract, the former Chief Executive Officer was to
Exit Page 20 2002-CH-1801
Finding 3
receive $40,000 per year, all expenses, and a
management incentive of two percent of any new grants
or financing received by the Corporation. The contract
did not indicate a specific number of hours to be
worked by the former Chief Executive Officer. As of
October 12, 2001, the Corporation had paid the
former Chief Executive Officer $18,620 for consulting
services and expenses.
The Housing Authority and Washington Court
Redevelopment Corporation did not: competitively
award the consulting contracts; prepare a cost analysis
of the services; maintain records sufficient to detail the
significant history of the procurement; or maintain
documentation to support the justification of the
noncompetitive awards. The Housing Authority and the
Corporation initiated action in September 2001 to
terminate the contracts and recapture any funds paid to
the former Chief Executive Officer after we questioned
the appropriateness of the contracts. As of October
31, 2001, the former Chief Executive Officer had not
repaid the Housing Authority or the Corporation for the
consulting fees received.
The Housing Authority paid $10,368 in HUD funds
HUD Funds Were (Public Housing and Section 8 Administrative Fees) to
Inappropriately Used To the former Chief Executive Officer for 596 hours of
Benefit The Former Chief excessive vacation, sick, and personal leave time. The
Executive Officer payment of the monetized leave time was not
reasonable and necessary low-income housing expense,
and was not available to be used for other low-income
housing purposes as required by HUD’s regulation and
Office of Management and Budget Circular A-87. The
payment was also not permitted by the Authority’s
Personnel Manual.
The Housing Authority lacked procedures and controls
The Authority’s Board Was to ensure that contract awards and/or fringe benefits
Not Aware Of expenses met Federal requirements, State of Indiana
Requirements law, and/or the Authority’s requirements. The Housing
Authority’s Chairman of the Board said the Board was
not aware of the Federal, State, and the Authority’s
conflict of interest requirements. The Authority’s
Exit Page 21 2002-CH-1801
Finding 3
Chairman also said he was not aware that the
Authority’s Personnel Manual prohibited the payment
of unused sick time and limited the payment of vacation
time to employees. As a result, HUD funds were not
efficiently and effectively used. HUD and the Housing
Authority also lack assurance that contract awards
were subject to full and open competition.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 53 to 55, contains the complete text of the
comments.]
The Housing Authority agrees that contrary to Federal
requirements, State of Indiana law, and/or its
requirements, the Authority’s former Chief Executive
Officer received consulting contracts and fringe benefits.
Therefore, the Housing Authority will: take any and all
appropriate action to recapture the consulting fees that
were improperly paid to the former Chief Executive
Officer or the Authority will reimburse the improper
fees from non-Federal funds to the appropriate
programs; and implement procedures and controls to
ensure the Authority and its contractors follow Federal
requirements, State law, and/or the Authority’s
requirements when awarding contracts and paying
fringe benefits.
The Housing Authority made significant attempts to
recover and/or recapture the consulting fees that were
improperly paid to the former Chief Executive Officer.
The Authority was unsuccessful in its written demands
for repayment of the fees. Consequently, the Authority
and Washington Court Redevelopment Corporation
filed a lawsuit against the former Chief Executive
Officer. We requested the Vanderburgh Circuit Court
declare as void and unenforceable the consulting
contracts and order the former Chief Executive Officer
to repay any monies received under the contracts.
Subject to resolution of the lawsuit, any and all
appropriate repayments of the consulting fees will be
made at that time.
Exit Page 22 2002-CH-1801
Finding 3
The Housing Authority reimbursed from non-Federal
funds the $10,368 in unnecessary and unreasonable
fringe benefits paid to the former Chief Executive
Officer on November 8, 2001. The Authority will
continue to work diligently to further implement
procedures and controls to ensure the Housing
Authority and its contractors follow Federal
requirements, State of Indiana law, and/or the
Authority’s requirements when awarding contracts and
paying fringe benefits.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should help ensure that the Housing
Authority and its contractors follow Federal
requirements, State of Indiana law, and/or the
Authority’s requirements when awarding contracts and
paying fringe benefits. Based upon the documentation
provided by the Housing Authority, we removed the
recommendation for the Authority to reimburse from
non-Federal funds for the unnecessary and
unreasonable fringe benefits paid to the former Chief
Executive Officer.
Recommendations We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
3A. Takes any and all appropriate action to
recapture the $23,120 ($4,500 from the
Housing Authority and $18,620 from
Washington Court Redevelopment
Corporation) for consulting services and/or
expenses that were improperly paid to the
former Chief Executive Officer. If the Housing
Authority is unable to recapture the money, the
Authority should reimburse the improper fees
from non-Federal funds to the appropriate
programs.
3B. Implements procedures and controls to ensure
the Housing Authority and its contractors follow
Exit Page 23 2002-CH-1801
Finding 3
Federal requirements, State of Indiana law,
and/or the Authority’s requirements when
awarding contracts and paying fringe benefits.
Exit Page 24 2002-CH-1801
Finding 4
The Housing Authority Needs To Improve Its
Contracting Process
The Housing Authority of the City of Evansville did not follow Federal requirements, State of
Indiana law, and/or the Authority’s Procurement Policy regarding the award of contracts for
cleaning services to its housing units and offices. In February 1997 and January 1998, the
Housing Authority awarded two contracts that totaled $45,154 in cleaning services when
conflicts of interest existed. The Housing Authority also did not competitively award three
cleaning contracts between January 1998 and May 1999 for $154,451 in services to a
resident-owned business. The Housing Authority lacked procedures and controls over its
contracting process. As a result, HUD funds were not efficiently and effectively used.
24 CFR Part 85.36(b)(3) states no employee, officer,
Federal Requirements or agent of a grantee will participate in the selection, or
in the award or administration of a contract supported
by Federal funds if a conflict of interest, real or
apparent, would be involved. Such a conflict would
arise when: the employee, officer, or agent, any member
of his immediate family, his partner, or an organization
which he is employed by, or is about to employ, has a
financial or other interest in the firm selected for award.
Grantee’s officers, employees, or agents are prohibited
from accepting anything of monetary value from its
contractors.
24 CFR Part 85.36(b)(9) requires grantees and
subgrantees to maintain records sufficient to detail the
significant history of a procurement, such as the
rationale for the method of procurement and the basis
for the contract price. Part 85.36(c)(1) requires that all
procurement transactions be conducted in a manner
providing full and open competition.
24 CFR Part 85.36(d)(2) requires that when the sealed
bid method is used, a firm-fixed-price contract is
awarded to the responsible bidder whose bid,
conforming with all the material terms and conditions of
the invitation for bids, is the lowest price. Part
85.36(d)(4) states procurement by noncompetitive
proposals may be used only when the award of a
Exit Page 25 2002-CH-1801
Finding 4
contract is not feasible under small purchase
procedures, sealed bids, or competitive proposals. In
addition, noncompetitive proposals may only be used
after solicitation of a number of sources and competition
is determined to be insufficient.
24 CFR Part 963.12(a) requires public housing
authorities to follow 24 CFR Part 85.36(b) and (d)
when awarding contracts to resident-owned businesses.
Authorities are permitted to limit solicitation to resident-
owned businesses. 24 CFR Part 963.12(b) states an
award will not be made to a resident-owned business if
the contract price exceeds the independent cost
estimate required by 24 CFR 85.36(f), and the price
normally paid for comparable services.
Section 19 of Part A of the Consolidated Annual
Contributions Contract, between HUD and the Housing
Authority of the City of Evansville, states the Housing
Authority may not enter into any contract in connection
with a project under this Contract in which any of the
following classes of people has an interest, direct or
indirect, during his or her tenure or for one year
thereafter: any present or former member or officer of
the governing body of the Authority, or any member of
the officer’s immediately family; and any public official
or member of the local governing body who exercises
functions or responsibilities with respect to the
project(s) or the Authority.
Section 36-7-18-11 of the Indiana Code states a
State Of Indiana Law commissioner of a housing authority may not have any
direct or indirect interest in a contract for services to be
furnished or used in connection with any housing
project.
Page 1 of the Housing Authority’s November 10, 1994
Authority’s Procurement Procurement Policy states that any procurement greater
Policy than $2,500 requires advertisement for a minimum of
four times in at least two newspapers for two
consecutive weeks. Page 4 of the Housing Authority’s
1994 Policy requires that noncompetitive proposals
may only be used when: a contract award is not feasible
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Finding 4
using small purchase procedures, sealed bids, or
competitive proposals; and insufficient competition is
found after the Authority has solicited from a number of
sources. The Policy also states noncompetitive
proposals must be justified with written documentation.
Page 6 of the Housing Authority’s 1994 Policy requires
the Authority’s officers and employees to avoid any
conflict of interest in the selection or award of any
contract, and avoid any financial or other conflict of
interest.
Contrary to Federal requirements, State of Indiana law,
The Authority Improperly and the Housing Authority’s Procurement Policy, the
Awarded Cleaning Authority awarded two contracts to Clean-All for
Contracts To A Company $45,154 in cleaning services to its housing units. The
Owned By A City two contracts were awarded in February 1997 and
Councilwoman January 1998, and were paid from the Housing
Authority’s Public Housing Operating Program. Clean-
All was a subsidiary of HMR Corporation, which is
owned by a Councilwoman of the City of Evansville.
The City Councilwoman exercises functions related to
the Housing Authority, thus creating a conflict of
interest. Federal requirements, State law, and the
Housing Authority’s Policy prohibit the Authority to
award contracts when a conflict of interest exists.
The Councilwoman’s functions include being a member
of the Board of Directors of RESPECT, Inc. since
1995. RESPECT, Inc. is a non-profit entity established
by the Housing Authority to provide its residents with
such services as training and educational opportunities
to improve their quality of life. In addition, the
Councilwoman voted to approve the City of
Evansville’s Ordinances F-96-7 and F-97-12 in June
1996 and September 1997, respectively. The
Ordinances provided the Housing Authority with over
$100,000 in HOME funds from the City.
The Housing Authority also improperly split the
February 1997 contract award between Clean-All and
M&W Cleaning Services. The Housing Authority
solicited bids until January 29, 1997 for cleaning
services to the Authority’s housing units. The bid
Exit Page 27 2002-CH-1801
Finding 4
solicitation did not provide for the splitting of the
contract award. Clean-All, M&W, and Partners-N-
Grime submitted bids to the Authority. On January 29,
1997, the Housing Authority held a meeting to open the
three bids.
The bid meeting was attended by: the Housing
Authority’s Director of Asset Management and a
Commissioner; the City Councilwoman; and
representatives of M&W and Partners-N-Grime.
M&W was the lowest responsible bidder; however, the
Housing Authority’s Director of Asset Management
said the Authority’s former Chief Executive Officer
instructed him to split the contract award between
Clean-All and M&W. He also said the former Chief
Executive Officer told him that M&W lacked the
capacity to perform the cleaning services. The Housing
Authority’s Director of Asset Management and the
owner of M&W Cleaning Services said that M&W had
the capacity to perform the services. The Housing
Authority’s files lacked documentation to support that
M&W’s capacity was insufficient. Since the Housing
Authority split the 1997 cleaning contract between
Clean-All and M&W, the Authority incurred $2,970 in
additional cleaning expenses.
The Housing Authority improperly awarded the two
cleaning contracts to Clean-All because a conflict of
interest also existed with one of the Authority’s
Commissioners. The Commissioner’s two sons
worked on the two contracts for Clean-All. In
addition, the Commissioner was paid by the City
Councilwoman to work on her 1999 reelection
campaign.
As previously mentioned, the Housing Authority’s
Commissioner attended the January 1997 bid meeting.
The Commissioner said she attended the meeting after
receiving complaints that minority contractors were not
awarded contracts from the Housing Authority. She
said she did not provide the complaint to the Housing
Authority’s former Chief Executive Officer or any
members of the Authority’s Board. The Commissioner
Exit Page 28 2002-CH-1801
Finding 4
said she had not attended a bid opening prior to or
subsequent to the January 1997 meeting.
Contrary to HUD’s regulations and the Housing
The Authority Did Not Authority’s Procurement Policy, the Authority awarded
Competitively Award contracts to Sutton Commercial Maintenance Services.
Contracts To A Resident- The Housing Authority did not competitively award the
Owned Business contracts to Sutton nor did the Authority’s files include
documentation to support that a noncompetitive award
was justified. Therefore, the Housing Authority’s
award of the contracts was not subject to full and open
competition.
The Housing Authority awarded three contracts to
Sutton Commercial Maintenance Services for
$154,451 in cleaning services to the Authority’s housing
units and/or offices. The three contracts were awarded
between January 1998 and May 1999, and were paid
from the Housing Authority’s Public Housing Operating
Program. Sutton Commercial Maintenance Services is
owned by a resident of the Housing Authority.
For the January 1, 1998 contract, the Housing
Authority improperly split the contract award between
Sutton Commercial Maintenance Services and Clean-
All. The Housing Authority solicited bids for cleaning
services to the Authority’s housing units. The bid
solicitation did not provide for the splitting of the
contract award. The Housing Authority received five
bids. A bid opening was held on December 8, 1997,
and Clean-All was the lowest bidder. However, the
Housing Authority’s former Chief Executive Officer
awarded part of the cleaning services to Sutton at the
same price quoted by Clean-All.
The Housing Authority also awarded Sutton
Commercial Cleaning Services a second contract in
January 1998. The contract included cleaning services
to the Housing Authority’s offices, and was effective
January 12, 1998. The Housing Authority did not
advertise a bid solicitation nor did it attempt to obtain
price quotations from contractors. Therefore, the
Exit Page 29 2002-CH-1801
Finding 4
contract was not awarded through full and open
competition.
To determine whether the costs of the cleaning services
paid to Sutton Commercial was reasonable, we
attempted to get price quotations from two cleaning
vendors in the City of Evansville. Only one vendor
provided us a price quote. The costs charged by
Sutton appear within an acceptable range when
compared to the one vendor’s quote.
The Housing Authority awarded Sutton Commercial
Cleaning Services a third contract in May 1999. The
third contract was for cleaning services to the Housing
Authority’s housing units. The Housing Authority
advertised a bid solicitation and received three bids.
On January 28, 1999, the Housing Authority held a
meeting to open the three bids. Dilbeck’s Carpet and
Janitorial Cleaning Services was the lowest responsible
bidder. However, the Housing Authority’s former
Chief Executive Officer said he decided to award the
contract to Sutton at a higher rate than Dilbeck’s bid to
support resident-owned businesses. As a result, the
Housing Authority paid Sutton $1,547 for excessive
cleaning services.
The Housing Authority’s former Chief Executive Officer
said Sutton Commercial Cleaning Services was the only
resident-owned cleaning business. However, the
Authority lacked documentation to this claim. The
Housing Authority also lacked an organized and
concerted effort to determine whether other resident-
owned businesses existed to perform the cleaning
services. An organized and concerted effort would
include such actions as advertising, distributing fliers, or
holding meetings concerning the cleaning services.
The Housing Authority lacked procedures and controls
The Authority’s Staff Was over its contracting process to ensure that they met
Not Aware Of Federal Federal requirements, State of Indiana law, and the
Requirements Authority’s Procurement Policy. The Housing
Authority’s Director of Asset Management, the former
Chief Executive Officer, and the Commissioner involved
Exit Page 30 2002-CH-1801
Finding 4
with the Clean-All contracts said they were not aware
of the Federal, State, and the Authority’s conflict of
interest requirements. The Authority’s former Chief
Executive Officer also said he was not aware of HUD’s
and the Authority’s requirements regarding the award of
contracts to resident-owned businesses. As a result,
HUD funds were not efficiently and effectively used.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 56 and 57, contains the complete text of the
comments.]
The Housing Authority agrees that it did not follow
Federal requirements, State of Indiana law, and/or the
Authority’s Procurement Policy regarding the award of
contracts for cleaning services to its housing units and
offices. Therefore, the Housing Authority will
implement procedures and controls to ensure that it
follows Federal requirements, State law, and the
Authority’s Procurement Policy when awarding
contracts. The Authority reimbursed its Public Housing
Program $4,517 ($2,970 plus $1,547) from non-
Federal funds for the additional cleaning costs incurred
by awarding the contracts to Clean-All and Sutton
Commercial Maintenance Services.
The Housing Authority will continue to utilize the
services of its Special Programs Department for all
contracting subject to review by the Authority’s legal
counsel and approval by the Executive Director. The
Authority anticipates creating a Capital Improvement
and Procurement Department for Fiscal Year 2003.
The Department will serve as a safeguard whereby all
future contracting would be brought to this Department
to be bid out in accordance with regulatory
requirements.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should help ensure that the Housing
Authority follows Federal requirements, State of
Exit Page 31 2002-CH-1801
Finding 4
Indiana law, and the Authority’s Procurement Policy
when awarding contracts. Based upon the
documentation provided by the Housing Authority, we
removed the recommendation for the Authority to
reimburse $4,517 from non-Federal funds for the
excessive cleaning costs incurred by awarding the
contracts to Clean-All and Sutton Commercial
Maintenance Services.
Recommendation We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
4A. Implements procedures and controls to ensure
the Housing Authority follows Federal
requirements, State of Indiana law, and the
Authority’s Procurement Policy when awarding
contracts.
Exit Page 32 2002-CH-1801
Finding 5
The Authority’s Actions Regarding The
Emporia Project Were Improper
The Housing Authority of the City of Evansville did not follow Federal requirements regarding
the acquisition, development, and disposition of property for the Emporia Project. Specifically,
the Housing Authority: (1) improperly used $4,203 in HUD funds (Public Housing Operating
Program and Comprehensive Grant Program) to acquire, develop, and dispose of 17 parcels of
property; (2) misused its eminent domain authority related to the purchase of five parcels of
property; and (3) failed to publicly solicit bids when it disposed of the property. The Housing
Authority also failed to obtain HUD’s approval to acquire and sell the property. The Authority
lacked procedures and controls to ensure HUD funds were properly used and the acquisition,
development, and disposition of property met Federal requirements. As a result, HUD funds
were not used in an efficient and effective manner. HUD also lacks assurance that the Housing
Authority’s property transactions were carried out in a fair and equitable manner.
24 CFR Part 970.9(a) requires a public housing
Federal Requirements authority to obtain HUD’s approval when disposing of
real property and the disposition should be done by
public solicitation of bids for not less than fair market
value, unless HUD authorizes the negotiated sale for
reasons found to be in the best interest of the authority
or the Federal government.
24 CFR Part 968.125 requires that after HUD
approves a public housing authority’s modernization
program and enters into an Annual Contributions
Contract amendment with the authority, the authority
will undertake the modernization activities and
expenditures set forth in its Comprehensive Grant
Program Annual Statement/Five-Year Action Plan.
24 CFR Part 968.105 defines a modernization project
as the improvement of one or more existing public
housing developments under a unique number
designated for that modernization program. For each
modernization project, HUD and the public housing
authority will enter into an Annual Contributions
Contract amendment requiring low-income use of the
housing for not less than 20 years from the date of the
amendment.
Exit Page 33 2002-CH-1801
Finding 5
Section 9(C)(1) of the Annual Contributions Contract
between HUD and the Housing Authority of the City of
Evansville says the Authority may withdraw funds from
the General Fund only for the payment of the costs of
development and operation of the projects under
Contract with HUD. Section 1 of the Contract
prohibits the Housing Authority from acquiring real
property without HUD’s approval.
HUD Handbook 1378.0, Tenant Assistance,
Relocation, and Real Property Acquisition, page 5-5,
prohibits housing authorities from advancing the time of
condemnation, deferring negotiations or condemnation,
or taking coercive action in order to induce an
agreement on the price to be paid for the property.
Page 5-6 of the Handbook states if a housing authority
intends to acquire any interest in real property by
exercise of the power of eminent domain, it will institute
formal condemnation proceedings.
Contrary to HUD’s regulations and the Annual
The Authority Improperly Contributions Contract, the Housing Authority used
Used HUD Funds To HUD funds to purchase, develop, and dispose of
Purchase, Develop, And parcels of property for the Emporia Project. The
Sell Property For The Housing Authority did not obtain HUD’s approval to
Emporia Project purchase or sell the property for the Project. The
Authority also failed to publicly solicit bids when it
disposed of the property.
The Housing Authority purchased 14 parcels of
property between May 1997 and June 1998. Three
additional parcels of property were donated to the
Housing Authority in January 1995. The three donated
parcels were adjacent to the 14 parcels. The Housing
Authority did not request HUD’s approval to purchase
the 14 parcels of property.
The 17 parcels of property (14 purchased and three
donated) are located near Lincoln Estates, a former
public housing site previously known as Lincoln
Gardens. Lincoln Estates currently receives Section 8
rental assistance from the Housing Authority. Emporia
Incorporated, the purchaser of the property from the
Exit Page 34 2002-CH-1801
Finding 5
Housing Authority, built a grocery store and a discount
store to serve the residents of Lincoln Estates and the
surrounding community.
The Housing Authority used $247,776 ($238,785 in
Section 8 Administrative Fees, $5,900 in Public
Housing Operating Program, and $3,091 in
Comprehensive Grant Program) to acquire, develop,
and/or dispose of the 17 parcels of property for the
Emporia Project. The development cost of the
property included such items as the demolition of
buildings, removal of underground gas tanks, and the
rezoning of the property to commercial use. In
February 1999, the Authority reimbursed its Public
Housing Operating Program $2,663 and
Comprehensive Grant Program $2,125 with monies
from its Section 8 Administrative Fees for non-salary
costs associated with the Project.
The acquisition, development, and/or disposition cost
included time spent by three of the Housing Authority’s
employees who were paid with HUD funds to work on
the Project. The three employees were the Housing
Authority’s former Chief Executive Officer, current
Interim Section 8 Director, and its Staff Attorney. The
Authority used $4,203 in HUD funds ($3,237 in Public
Housing Operating Program and $966 in
Comprehensive Grant Program) to pay the three
employees’ salaries and fringe benefits while they
worked on the Project. As of August 2001, the
Housing Authority had not reimbursed its Public
Housing Operating Program and the Comprehensive
Grant Program for the employees’ time spent on the
Project.
The Housing Authority sold the 17 parcels of property
to Emporia Incorporated in June 1999. The Housing
Authority did not request HUD’s approval to sell the 17
parcels of property nor did the Authority publicly solicit
bids when it disposed of the property.
While the Housing Authority was permitted to use
Section 8 Administrative Fee monies on the Emporia
Exit Page 35 2002-CH-1801
Finding 5
Project, the Authority was not permitted to use Public
Housing Operating or Comprehensive Grant Program
funds to pay for the acquisition, development, and/or
disposition of the property since the property was not
under the Annual Contributions Contract with HUD.
HUD’s requirements also required the Housing
Authority to publicly solicit bids when it disposes of
property, and to obtain HUD’s approval to acquire and
sell property.
Contrary to HUD Handbook 1378.0, the Housing
The Authority Misused Its Authority threatened to use its eminent domain authority
Eminent Domain Authority to purchase property for the Emporia Project. The
To Acquire Property Housing Authority had not initiated formal
condemnation proceedings declaring that it was
necessary to acquire the property using eminent
domain.
In December 1997, the Housing Authority started
purchasing property for the Emporia Project. The
Housing Authority sent letters to the property owners
requesting them to sell their property to the Authority.
Three owners did not respond to the Housing
Authority’s request. The three owners owned five
parcels of property located at 513, 515, 517, and 521
Lincoln Avenue and 609 South Garvin Street.
The Housing Authority sent letters to the three owners
in March 1998 that the Authority was prepared to
exercise its eminent domain authority to obtain the five
parcels of property.
The Housing Authority’s current Interim Director of
Section 8 said the Authority’s former Chief Executive
Officer requested him to use the power of eminent
domain to obtain the five parcels. In March 1998, the
Housing Authority sent letters to the three owners
informing them that the Authority had improperly
threatened its eminent domain authority. The Housing
Authority withdrew its intent to use eminent domain
because the owners and the local media expressed
concern about the Authority’s ability to exercise its
eminent domain authority.
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Finding 5
The Housing Authority did not initiate formal
condemnation proceedings declaring that it was
necessary to acquire the property using eminent domain
prior to notifying the three owners. HUD Handbook
1378.0 requires the Housing Authority to institute
formal condemnation proceedings if it intends to acquire
any interest in real property by exercise of the power of
eminent domain.
The Authority lacked procedures and controls to ensure
The Authority’s Staff Was HUD funds were properly used and the acquisition,
Not Aware Of Federal development, and disposition of property met Federal
Requirements requirements. The Authority’s former Chief Executive
Officer and the current Interim Director of Section 8
said they were not aware of Federal requirements
regarding the acquisition, development, and disposition
of property. As a result, HUD funds were not used in
an efficient and effective manner. HUD also lacks
assurance that the Housing Authority’s property
transactions were carried out in a fair and equitable
manner.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 58 and 59, contains the complete text of the
comments.]
The Housing Authority agrees that it did not follow
Federal requirements regarding the acquisition,
development, and disposition of property for the
Emporia Project. Therefore, the Housing Authority will
implement procedures and controls to ensure that it
follows the requirements when acquiring, developing,
and/or disposing of property. The Authority
reimbursed its Public Housing Operating Program
$3,237 and its Comprehensive Grant Program $966
from non-Federal funds for the cost of acquiring,
developing, and/or selling the 17 parcels of property for
the Emporia Project.
The Housing Authority agrees that it improperly
threatened its eminent domain authority to acquire
Exit Page 37 2002-CH-1801
Finding 5
property for the Emporia Project. The Authority also
did not initiate or institute formal condemnation
proceedings declaring it necessary to acquire an interest
in the property using eminent domain as required in
HUD Handbook 1378.0.
The Housing Authority: intends to present its Board of
Commissioners a resolution at an upcoming Board
meeting stating that the Authority does not encourage
the use of eminent domain; will require that all matters
which contemplate the use of formal condemnation
proceedings by eminent domain be presented to its
Board for review and approval; and will continue to
readily implement and follow procedures by promptly
requesting HUD’s approval prior to the acquisition
and/or sale of any and all future property to better
ensure compliance with Federal requirements.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should help ensure that the Housing
Authority follows Federal requirements when acquiring,
developing, and/or disposing of property. Based upon
the documentation provided by the Housing Authority,
we removed the recommendation for the Authority to
reimburse $4,203 ($3,237 plus $966) from non-
Federal funds for the improper use of HUD funds to
acquire, develop, and dispose of 17 parcels of
property.
Recommendation We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
5A. Implements procedures and controls to ensure
the Authority follows Federal requirements
when acquiring, developing, and/or disposing of
property.
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Finding 6
The Authority Did Not Exercise Sound
Management Practices Over Its Construction
Steel
The Housing Authority of the City of Evansville did not exercise sound management practices
over steel purchased for construction work. In December 1996, the Housing Authority used
$17,278 in Comprehensive Grant Program funds to purchase the steel for construction work to
its former administration offices located at 411 South East 8th Street. The Housing Authority
stopped the work because it purchased a building located at 500 Court Street for its offices.
As of July 2001, the Housing Authority had not made a decision regarding the use of the steel.
In addition, $1,730 in steel decking rusted and was discarded because it was not fit for use.
The Housing Authority’s former and current management staff failed to decide whether to use
the steel in another project or scrap the steel for its fair market value. As a result, HUD funds
were not used in an efficient and effective manner.
24 CFR Part 85.22(b) requires that State, local, and
Federal Requirements Indian tribal governments follow Office of Management
and Budget Circular A-87, Cost Principles for State,
Local, and Indian Tribal Governments. 24 CFR Part
85.3 defines a local government to include any public
housing agency.
Office of Management and Budget Circular A-87,
Attachment A, paragraph (2)(a)(1), states governmental
units are responsible for the efficient and effective
administration of Federal awards through the
application of sound management practices.
Section 4 of the Consolidated Annual Contributions
Contract, between HUD and the Housing Authority of
the City of Evansville, requires the Authority to at all
times develop and operate each project in a manner
that promotes serviceability, economy, and efficiency.
Contrary to Office of Management and Budget Circular
The Authority’s A-87 and the Consolidated Annual Contributions
Management Has Not Contract, the Housing Authority’s former and current
Decided What Action To management staff failed to exercise sound management
Take Regarding Its Steel
Exit Page 39 2002-CH-1801
Finding 6
practices regarding the efficient and effective use of
steel purchased for construction work.
In December 1996, the Housing Authority used
$17,278 in Comprehensive Grant Program funds to
purchase steel for construction work to its former
administration offices located at 411 South East 8th
Street. The steel was cut to meet the Housing
Authority’s specifications and included such items as
decking, bar joists, roof framing, and beams. The
Housing Authority stopped the work because it
purchased a building located at 500 Court Street for its
offices.
The Housing Authority’s former and current
management staff has not decided whether to use the
steel for another project or scrap the steel for its fair
market value. The Housing Authority’s Director of
Special Programs said the Authority plans to take
possession of the steel from FabCon, the manufacturer
of the steel, by the end of August 2001. However, she
said the Authority has not decided how to use the steel.
The Housing Authority’s former Chief Executive Officer
said he was not aware of the steel until approximately
March 1999. The former Chief Executive Officer did
not make any decision regarding the use of the steel
prior to his resignation from the Authority in February
2001.
FabCon informed the Housing Authority in 1998 that
the steel decking rusted and was no longer fit for use.
The Plant Manager for FabCon said the decking was
discarded in 1998 since it did not have any salvage
value. No one from the Housing Authority confirmed
the condition of the decking or that it was discarded
until March 2001. The steel decking cost $1,730. As
previously mentioned, the Housing Authority used
Comprehensive Grant funds to purchase the steel. As a
result, HUD funds were not used in an efficient and
effective manner.
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Finding 6
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 60 and 61, contains the complete text of the
comments.]
The Housing Authority agrees that it did not exercise
sound management practices over steel purchased for
construction work. Therefore, the Housing Authority
will: take appropriate and timely action to either use the
remaining steel for an Authority project or sell the steel
for its fair market value; reimburse its Comprehensive
Grant Program funds $1,730 from non-Federal funds
for the steel decking that rusted and was discarded; and
implement procedures and controls to ensure that it
follows Federal requirements when purchasing
construction steel for future projects.
The Housing Authority is scheduled to take possession
of the remaining steel on August 14, 2001. The
Authority’s Director of Special Programs
recommended that the steel be used in the construction
of a new multipurpose building at the Erie Homes
Project. In July 2000, the Housing Authority’s
Construction Department was reorganized to report
directly to the Authority’s Director of Special
Programs. This reorganization was implemented as a
safeguard to better ensure that the Housing Authority
follows Federal requirements when expending
Comprehensive Grant Program funds.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should help ensure that the Housing
Authority follows Federal requirements when
purchasing construction steel for future projects.
Recommendations We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
Exit Page 41 2002-CH-1801
Finding 6
6A. Takes appropriate and timely action to either
use the remaining steel for a Housing Authority
project or sells the steel for its fair market value.
6B. Reimburses its Comprehensive Grant Program
$1,730 from non-Federal funds for the steel
decking that rusted and was discarded.
6C. Implements procedures and controls to ensure
the Authority follows Federal requirements
when purchasing construction steel for future
projects.
Exit Page 42 2002-CH-1801
Finding 7
The Authority Did Not Sufficiently Allocate
Costs To Its Various Programs
The Housing Authority of the City of Evansville did not have an acceptable cost allocation plan
to support the allocation of costs among its programs. Specifically, the Housing Authority did
not charge employees’ salaries and fringe benefits to all of the Authority’s programs that
received their services. The Authority also failed to allocate non-salary costs to its various
programs. Housing authorities must allocate costs to benefiting grant programs. The
Authority’s Director of Finance and the former Chief Executive Officer said they were not
aware that the cost allocation plan has to be supported with documentation to show the basis
for allocating employees’ salaries and fringe benefits, and non-salary costs to Federal awards.
As a result, neither HUD nor the Housing Authority had assurance that costs charged to the
Authority’s various programs were reasonable in relation to the benefits they received.
24 CFR Part 85.22(b) requires that State, local, and
Federal Requirements Indian tribal governments follow Office of Management
and Budget Circular A-87, Cost Principles for State,
Local, and Indian Tribal Governments. 24 CFR Part
85.3 defines a local government to include any public
housing agency.
Office of Management and Budget Circular A-87,
Attachment A, requires State, local, and Federally-
recognized Indian tribal governments to establish
principles to provide that Federal awards bear their fair
share of costs. Attachment C of the Circular says
governments need a process whereby costs can be
assigned to benefited activities on a reasonable and
consistent basis. The cost allocation plan provides that
process. All cost and other data used to distribute the
costs included in the plan should be supported by
formal accounting and other records that support the
propriety of the costs assigned to Federal awards.
The Housing Authority did not have an acceptable cost
The Authority Lacked An allocation plan to support the costs among its programs.
Acceptable Plan The Authority administered both HUD and non-HUD
programs. The HUD funded programs include: Public
Housing; Multifamily Housing; Homebuyers; Section 8;
Comprehensive Grant; and Drug Elimination. The non-
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Finding 7
HUD funded programs include: Drug Free Indiana;
Washington Court; and Scattered Site Housing.
The Authority’s plan did not address the costs of its
employees’ salaries and fringe benefits.
According to the Housing Authority’s Director of
Finance, employees’ salaries and fringe benefits were
allocated during Fiscal Year 2000 based upon the
availability of funding or based on estimates made by
the Authority’s former Director of Operations. The
Authority did not have documentation to support the
former Director’s estimates. Allocating costs to
Federal programs based upon the availability of funding
among programs and unsupported estimates are not
acceptable methods. Housing authorities must
document an acceptable cost allocation plan.
We selected 11 of the Housing Authority’s employees
whose salaries were charged to the Authority’s various
programs to determine the time they spent related to the
programs. Since the Housing Authority did not maintain
documentation to support the employees’ time, we
interviewed the 11 employees to determine the time
they spent related to the Authority’s programs. Seven
of the 11 employees said they spent either more or less
time than the percentage the Authority charged to its
various programs; three employees said they were
unable to estimate how much time they spent on each
program; one indicated that the percentage of her salary
was properly allocated.
The following table shows the estimated time spent on
each program and the percentage of salary and fringe
benefits allocated for four of the seven employees who
said they spent either more or less time than the
Authority charged to its various programs.
Exit Page 44 2002-CH-1801
Finding 7
Percentage Of Salary And Benefits
Employee Estimated Time Spent On Program(s) Allocated To Each Program
Director of Asset • 100 Percent – Public Housing • 89 Percent – Public Housing
Management • 11 Percent – Comprehensive
Grant
Assistant to the • 100 Percent – Public Housing • 42 Percent – Public Housing
Director of Asset • 58 Percent – Comprehensive
Management Grant
Accountant • 85 to 90 Percent – Public Housing • 54 Percent – Public Housing
• 10 to 15 Percent – Comprehensive • 22 Percent – Section 8
Grant • 24 Percent – Comprehensive
Grant
Former Director of • 60 Percent – Non-HUD Programs • 45 Percent – Public Housing
Human Resources • 20 Percent – Section 8 • 24 Percent – Section 8
(currently Interim • 10 Percent – Public Housing • 26 Percent – Comprehensive
Director of Section • 10 Percent – Comprehensive Grant Grant
8) • 5 Percent – Non-HUD Programs
The Authority also did not allocate non-salary costs
such as electricity, water and sewage, trash collection,
and property hazard insurance for its administrative
office located at 500 Court Street to all of the benefiting
programs. The Authority allocated all of the non-salary
costs to the Public Housing Program. The Housing
Authority’s administrative office housed the Authority’s
employees that spent time working on both HUD
funded and non-HUD funded Programs.
The Authority’s Director of Finance and the former
Chief Executive Officer said they were not aware that
the cost allocation plan has to be supported with
documentation to show the basis for allocating
employees’ salaries and fringe benefits, and non-salary
costs to Federal awards.
As a result, the Housing Authority and HUD lacked
assurance that costs charged to the Authority’s various
programs were reasonable in relation to the benefits
they derived.
Auditee Comments [Excerpts paraphrased from the Housing Authority’s
comments on our draft finding follow. Appendix B,
pages 50 and 51, contains the complete text of the
comments.]
Exit Page 45 2002-CH-1801
Finding 7
The Housing Authority agrees that its former Chief
Executive Officer did not properly allocate costs to its
various programs. Therefore, the Authority will:
develop a cost allocation plan in accordance with Office
of Management and Budget Circular A-87; reallocate
the indirect costs charged to the appropriate programs
for Fiscal Year 2000, once the cost allocation plan is
developed; and implement procedures and controls to
update its allocation plan as necessary.
The Housing Authority is actively reviewing its position
and job descriptions to better ensure accuracy and
completeness throughout the Authority. During this
review and audit process, percentage of time allocations
will be determined to more accurately reflect the
percentage of time an employee devotes to a particular
Housing Authority program. This information will be
utilized to coordinate with the Housing Authority’s
Finance Department to ensure that the Authority’s cost
allocations reflect the actual time spent by an employee
supporting a particular program. After the initial review
and audit are completed, the Housing Authority will
institute an ongoing three-year program to monitor these
compliance related issues. Likewise, all non-salary
costs will also be monitored and distributed in
conjunction with the appropriate benefiting program or
associated salary costs.
The Housing Authority intends to have a cost allocation
plan and remedial procedures in place by November
30, 2001.
OIG Evaluation Of The actions planned by the Housing Authority, if fully
Auditee Comments implemented, should help ensure that the Housing
Authority follows Office of Management and Budget
Circular A-87 regarding the allocation of costs.
Recommendations We recommend that the Director of the Cleveland Area
Office of Public Housing Hub assure that the Housing
Authority of the City of Evansville:
Exit Page 46 2002-CH-1801
Finding 7
7A. Develops a cost allocation plan in accordance
with Office of Management and Budget
Circular A-87.
7B. Reallocates the indirect costs charged to the
appropriate programs for Fiscal Year 2000,
once the cost allocation plan is developed.
7C. Implements procedures and controls to update
its allocation plan as necessary.
Exit Page 47 2002-CH-1801
Appendix A
Schedule Of Ineligible Costs
Recommendation Ineligible
Number Costs 1/
2A $750,000
2B 161,283
3A 23,120
6B 1,730
Total $936,133
1/ Ineligible costs are costs charged to a HUD program or activity that the auditor
believes are not allowable by law, contract, or Federal, State, or local policies
or regulations.
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Appendix B
Auditee Comments
December 3, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Amended Response of the Housing Authority of the City of Evansville,
Indiana, (Housing Authority) to the September 26, 2001 Draft Audit Report of
the U.S. Department of Housing and Urban Development Inspector General
(HUD)
Dear Mr. Wolfe:
This letter amends and supersedes the Housing Authority’s initial response dated
October 12, 2001, in reference to your correspondence from the September 26, 2001 Draft
Audit Report concerning the HUD Proposed Finding “The Housing Authority Was Not
Operated According To Program Requirements”. I have reviewed the aforementioned Draft
Audit Finding of the Office of Inspector General for Audit, HUD (“Draft Audit Findings”)
submitted to me and provide the following comments on behalf of the Housing Authority. The
Housing Authority’s comments are set forth below:
HUD PROPOSED FINDING
“The Housing Authority Was Not Operated According To Program Requirements”
RESPONSE- The Housing Authority agrees that its former and current management staff did
not sufficiently exercise their responsibilities to effectively manage the Housing Authority and that
its Board of Commissioners did not effectively monitor operations of the Housing Authority
staff. Accordingly, the Housing Authority will:
a. Take appropriate and timely action to ensure that training is
obtained for its current management staff regarding Federal
requirements, State of Indiana law, and the Housing Authority’s
policies so that its programs are operated correctly.
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Page 49 2002-CH-1801
Appendix B
b. Take appropriate and timely action to ensure that training is
obtained for its Board of Commissioners regarding their roles and
responsibilities in monitoring the Housing Authority’s operations.
c. Supports the recommendation that the Director of the Cleveland
Area Office of Public Housing Hub consider taking appropriate
administrative action against the Housing Authority of the City of
Evansville’s former Chief Executive Officer and former Director of
Operations as permitted by 24 CFR Part 24.
In particular, the Housing Authority has worked and will continue to work to improve
training practices for its current management staff regarding Federal requirements, State of
Indiana law, and the Housing Authority’s policies in light of HUD’s proposed findings that the
Housing Authority was not operated according to program requirements. Likewise, the
Housing Authority has worked and will continue to work to further its obligation to provide
training for its Board of Commissioners regarding their roles and responsibilities in monitoring
the Housing Authority’s operations. Furthermore, the Housing Authority will continue to work
diligently to provide assurances to HUD and the general public that its resources are and will
continue to be used to the maximum extent to benefit low and moderate income tenants.
In closing, the Housing Authority would like to thank you and your staff for your
diligence and professionalism in conducting this audit. While the Housing Authority is very
proud of the work it has done and the services it has been providing, we remain open to
suggestions for improvement to our programs and truly appreciate your assistance in further
refining and improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
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Appendix B
November 30, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Amended Response of the Housing Authority of the City of Evansville,
Indiana, (Housing Authority) to the June 18, 2001 Draft Audit Report of the
U.S. Department of Housing and Urban Development Inspector General
(HUD)
Dear Mr. Wolfe:
This letter amends and supersedes the Housing Authority’s initial response dated July
27, 2001, in reference to your correspondence from the June 18, 2001 Draft Audit Report
concerning the HUD Proposed Findings “The Authority Did Not Sufficiently Allocate Costs To
Its Various Programs” and “The Authority Misspent Funds To Purchase and Renovate Its
Administration Building”. I have reviewed the aforementioned Draft Audit Findings of the
Office of Inspector General for Audit, HUD (“Draft Audit Findings”) submitted to me and
provide the following comments on behalf of the Housing Authority. The Housing Authority’s
comments are set forth below:
HUD PROPOSED FINDING
“The Authority Did Not Sufficiently Allocate Costs To Its Various Programs”
RESPONSE- The Housing Authority agrees that its former Chief Executive Officer did not
properly allocate costs to its various programs. Accordingly, the Housing Authority will:
a. Develop a cost allocation plan in accordance with Office of
Management and Budget Circular A-87.
b. Reallocate the indirect costs charged to the appropriate
programs for Fiscal Year 2000, once the cost allocation plan is
developed.
c. Implement procedures and controls to update its allocation plan
as necessary.
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Appendix B
In particular, the Housing Authority is actively reviewing its positions and job
descriptions to better ensure accuracy and completeness throughout the Housing Authority.
During this review and audit process, percentage of time allocations will be determined to more
accurately reflect the percentage of time an employee devotes to a particular Housing Authority
program. This information will then be utilized to coordinate with the Housing Authority’s
Finance Department to ensure that cost allocations derived reflect the actual time spent by an
employee supporting a particular Housing Authority program. In addition, after completion of
this initial review and audit, the Housing Authority will institute an ongoing three-year audit
program to monitor these compliance related issues. Likewise, all “non-salary” costs will also
be monitored and distributed in conjunction with the appropriate benefiting program or
associated salary costs.
d. The Housing Authority intends to have a cost allocation plan and
remedial procedures in-place with its review and audit to be
completed by November 30, 2001.
HUD PROPOSED FINDING
“The Authority Misspent Funds To Purchase and Renovate Its Administration
Building”
RESPONSE- The Housing Authority agrees that its former Chief Executive Officer and
former Director of Operations misspent funds to purchase and renovate its Administration
Building. Accordingly, the Housing Authority will:
a. Reimburse HUD $750,000 from non-Federal funds for the
improper use of HOPE I sales proceeds to purchase its
administration building or it will implement a HUD approved plan
that will outline the use of the $750,000 in non-Federal funds to
promote resident home-ownership.
b. Reimburse its Comprehensive Grant program fund $161,283 from
non-Federal funds for the improper use of Grant funds to renovate
the EHA’s administration building.
c. Implement procedures and controls to ensure the EHA follows
Federal requirements when purchasing and renovating property.
In particular, the Housing Authority is additionally seeking to fully utilize its
administration offices located at 500 Court Street. However, should the Housing Authority
discover it to be more cost effective to relocate to another facility, the Housing Authority will
follow appropriate HUD procedures, and promptly request HUD approval prior to any office
relocation. Likewise, the Housing Authority will follow appropriate HUD procedures and
promptly request HUD approval prior to any sale or lease of its 500 Court Street building.
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Appendix B
Furthermore, the Housing Authority will institute a procedure whereby future property
purchases and/or major renovations will be presented to and reviewed by a three (3) person
committee comprised of Housing Authority Board members. Then a proposed purchase will be
submitted to HUD for final review and/or approval.
e. The Housing Authority intends to have these remedial procedures
in-place and its course of action completed by December 31, 2001.
In closing, the Housing Authority would like to thank you and your staff for your diligence and
professionalism in conducting this audit. While the Housing Authority is very proud of the work
it has done and the services it has been providing, we remain open to suggestions for
improvement to our programs and truly appreciate your assistance in further refining and
improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
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Appendix B
November 30, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Response of the Housing Authority of the City of Evansville, Indiana,
(Housing Authority) to the October 31, 2001 Draft Audit Report of the U.S.
Department of Housing and Urban Development Inspector General (HUD)
Dear Mr. Wolfe:
This letter responds to your correspondence of October 31, 2001 Draft Audit Report
concerning the HUD Proposed Finding “The Former Chief Executive Officer Improperly
Received Consulting Contracts and Fringe Benefits”. I have reviewed the aforementioned Draft
Audit Finding of the Office of Inspector General for Audit, HUD (“Draft Audit Findings”)
submitted to me and provide the following comments on behalf of the Housing Authority. The
Housing Authority’s comments are set forth below:
HUD PROPOSED FINDING
“The Former Chief Executive Officer Improperly Received Consulting Contracts and
Fringe Benefits”
RESPONSE- The Housing Authority agrees that contrary to Federal requirements, State of
Indiana law, and/or the Housing Authority of the City of Evansville’s requirements, the Housing
Authority’s former Chief Executive Officer received consulting contracts and fringe benefits.
Accordingly, the Housing Authority will:
a. Take any and all appropriate action to recapture the $23,120
($4,500 from the Housing Authority and $18,620 from
Washington Court Redevelopment Corporation) in consulting
fees that were improperly paid to the former Chief Executive
Officer. Furthermore, if the Housing Authority is unable to
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Appendix B
recapture the money, the Authority will reimburse the improper
fees from non-Federal funds to the appropriate programs.
b. Reimburse from non-Federal funds the $10,368 in unnecessary
and unreasonable fringe benefits paid to the former Chief
Executive Officer from the Public Housing ($5,184) and
Section 8 Administrative Fees ($5,184) that did not meet
HUD’s regulation, Office of Management and Budget Circular
A-87, and the Housing Authority’s Personnel Manual.
c. Implement procedures and controls to ensure the Housing
Authority and its contractors follow Federal requirements, State
of Indiana law, and/or the Authority’s requirements when
awarding contracts and paying fringe benefits.
In particular, prior to the Housing Authority initiating formal litigation against the former
Chief Executive Officer, the Housing Authority made significant attempts to recover and/or
recapture the $23,120 ($4,500 from the Housing Authority and $18,620 from Washington
Court Redevelopment Corporation) in consulting fees that were improperly paid to the former
Chief Executive Officer. Correspondences by the Housing Authority to its former Chief
Executive Officer addressed contracts the former Chief Executive Officer entered into with the
Housing Authority and Washington Court Redevelopment Corporation as void and
unenforceable, and further stated that any funds received by the former Chief Executive Officer
under any contract between him, the Housing Authority, Washington Court Redevelopment
Corporation, or any other subsidiary of the Housing Authority, either during the time he was the
Chief Executive Officer or during the following year, must be repaid immediately or legal action
would be initiated to recover same. (Attached hereto as Exhibits A, B, and C).
The Housing Authority was unsuccessful in its written demands for repayment of the
aforementioned funds from the former Chief Executive Officer. Accordingly, the Housing
Authority and its subsidiary Washington Court Redevelopment Corporation then filed a lawsuit
against the former Chief Executive Officer requesting the Vanderburgh Circuit Court declare as
void and unenforceable the aforementioned consultant contracts, and order the former Chief
Executive Officer to repay any monies received under any and all consulting contracts.
(Attached hereto as Exhibits D and E). Therefore, subject to resolution of the aforementioned
lawsuit filed by the Housing Authority and Washington Court Redevelopment Corporation
against the former Chief Executive Officer, any and all appropriate repayments of the $23,120
will be made at that time. Additionally, the Housing Authority acknowledges that other monies
improperly paid in sick leave and personal time to its former Chief Executive Officer during
2001, specifically from January 1, 2001 to February 28, 2001, were inappropriate and intends
to recover and/or recapture these funds.
Furthermore, please be advised that the following remedial actions have been taken by
the Housing Authority to reimburse from non-Federal funds the $10,368 in unnecessary and
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Appendix B
unreasonable fringe benefits paid to the former Chief Executive Officer from the Public Housing
($5,184) and Section 8 Administrative Fees ($5,184). In particular, on November 5, 2001, a
payment requisition form regarding said reimbursement was issued to the Finance Department at
the Housing Authority to formally initiate remedial measures. On November 8, 2001, the
Housing Authority issued Check Number 112068 in the amount of $10,368.00 to reimburse its
Public Housing Operating Program $5,184.00 and Section 8 Administrative Fees $5,184.00.
Likewise, on November 8, 2001, $10,368.00 was deposited into the Housing Authority
account at Fifth Third Bank as evidenced by deposit slip and further reflected in the Fifth Third
Bank’s posting date receipt of November 9, 2001. (Attached hereto as Exhibit F).
Finally, the Housing Authority will continue to work diligently to further implement
procedures and controls to ensure the Housing Authority and its contractors follow Federal
requirements, State of Indiana law, and/or the Authority’s requirements when awarding
contracts and paying fringe benefits.
In closing, the Housing Authority would like to thank you and your staff for your
diligence and professionalism in conducting this audit. While the Housing Authority is very
proud of the work it has done and the services it has been providing, we remain open to
suggestions for improvement to our programs and truly appreciate your assistance in further
refining and improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
Exit
Page 56 2002-CH-1801
Appendix B
November 30, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Amended Response of the Housing Authority of the City of Evansville,
Indiana, (Housing Authority) to the September 24, 2001 Draft Audit Report of
the U.S. Department of Housing and Urban Development Inspector General
(HUD)
Dear Mr. Wolfe:
This letter amends and supersedes the Housing Authority responses dated October 11,
2001, and October 25, 2001, respectively, in reference to your correspondence from the
September 24, 2001 Draft Audit Report concerning the HUD Proposed Finding “The Housing
Authority Needs To Improve Its Contracting Process.” I have reviewed the aforementioned
Draft Audit Finding of the Office of Inspector General for Audit, HUD (“Draft Audit Findings”)
submitted to me and provide the following comments on behalf of the Housing Authority. The
Housing Authority’s comments are set forth below:
HUD PROPOSED FINDING
“The Housing Authority Needs To Improve Its Contracting Process”
RESPONSE- The Housing Authority agrees that it did not follow Federal requirements, State
of Indiana law, and/or the Authority’s Procurement Policy regarding the award of contracts for
cleaning services to its housing units and offices. Accordingly, the Housing Authority will:
a. Reimburse its Public Housing Operating Program $4,517
($2,970 to Clean-All and $1,547 to Sutton) from non-Federal
funds for the additional cleaning costs incurred by awarding the
contracts to Clean-All and Sutton Commercial Maintenance
Services.
b. Implement procedures and controls to ensure the Housing
Authority follows Federal requirements, State of Indiana law,
and the Housing Authority’s Procurement Policy when
awarding contracts.
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Page 57 2002-CH-1801
Appendix B
In particular, please be advised that the following remedial actions have been taken by
the Housing Authority to reimburse its Public Housing Program $4,517 from non-Federal funds
for the additional cleaning costs incurred by awarding the contracts to Clean-All and Sutton
Commercial Maintenance Services. On October 12, 2001, the Housing Authority issued
Check Number 111059 to reimburse its Public Housing Operating Program $4,517. On
October 17, 2001, $4,517 was deposited into the Housing Authority’s Low Rent Program
account at Fifth Third Bank as evidenced by deposit slip, transaction print out and receipt dated
October 19, 2001, attached hereto.
Furthermore, the Housing Authority will continue to utilize the services of the Special
Programs Department for all contracting subject to review by legal counsel, with ultimate
approval by the Executive Director who is the designated Contracting Officer for the Housing
Authority. The Special Programs Department is currently responsible for the majority of
contracting and has been actively assisting other Housing Authority Departments for the past
two (2) years to better ensure that procurement requirements in contracting are met and that
the Housing Authority follows Federal requirements, State of Indiana law, and its Procurement
Policy when awarding contracts. Additionally, pursuant to developing a cost allocation plan in
accordance with Office of Management and Budget Circular A-87, the Housing Authority will
actively review its positions and anticipates creating a Capital Improvement and Procurement
Department for Fiscal Year 2003. It is anticipated that the creation of a centralized Capital
Improvement and Procurement Department will serve as a safeguard whereby all future
contracting subject to procurement would be brought to this Department, specifically to the
attention of the Director of Capital Improvement and Procurement, to then be bid out in
accordance with regulatory requirements.
In closing, the Housing Authority would like to thank you and your staff for your
diligence and professionalism in conducting this audit. While the Housing Authority is very
proud of the work it has done and the services it has been providing, we remain open to
suggestions for improvement to our programs and truly appreciate your assistance in further
refining and improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
Exit
Page 58 2002-CH-1801
Appendix B
November 30, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Amended Response of the Housing Authority of the City of Evansville,
Indiana, (Housing Authority) to the September 18, 2001 Draft Audit Report of
the U.S. Department of Housing and Urban Development Inspector General
(HUD)
Dear Mr. Wolfe:
This letter amends and supersedes the Housing Authority responses dated October 10,
2001, and October 25, 2001, respectively, in reference to your correspondence from the
September 18, 2001 Draft Audit Report concerning the HUD Proposed Finding “The
Authority’s Actions Regarding The Emporia Project Were Improper.” I have reviewed the
aforementioned Draft Audit Finding of the Office of Inspector General for Audit, HUD (“Draft
Audit Findings”) submitted to me and provide the following comments on behalf of the Housing
Authority. The Housing Authority’s comments are set forth below:
HUD PROPOSED FINDING
“The Authority’s Actions Regarding The Emporia Project Were Improper”
RESPONSE- The Housing Authority agrees that it did not follow Federal requirements
regarding the acquisition, development, and disposition of property for the Emporia Project.
Accordingly, the Housing Authority will:
a. Reimburse its Public Housing Operating Program $3,237 and
its Comprehensive Grant Program $966 from non-Federal
funds for the cost of acquiring, developing, and/or selling the 17
parcels of property for the Emporia Project.
b. Implement procedures and controls to ensure the Housing
Authority follows Federal requirements when acquiring,
developing, and/or disposing of property.
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Page 59 2002-CH-1801
Appendix B
In particular, please be advised that the following remedial actions have been taken by
the Housing Authority to reimburse its Public Housing Operating Program $3,237 and its
Comprehensive Grant Program $966 from non-Federal funds for the cost of acquiring,
developing, and/or selling the 17 parcels of property for the Emporia Project. On October 12,
2001, the Housing Authority issued Check Number 111060 to reimburse its Public Housing
Operating Program $3,237. On October 17, 2001, $3,237 was deposited into the Housing
Authority’s Low Rent Program account at Fifth Third Bank as evidenced by deposit slip,
transaction print out and receipt dated October 19, 2001, attached hereto. Likewise, on
October 12, 2001, the Housing Authority issued Check Number 111058 to reimburse its
Comprehensive Grant Program $966. On October 16, 2001, $966 was deposited into the
Housing Authority’s Comprehensive Grant Program account at Fifth Third Bank as evidenced
by deposit slip, transaction print out and receipt dated October 19, 2001, attached hereto.
Furthermore, the Housing Authority agrees that it improperly threatened its eminent
domain authority to acquire property in March, 1998 and did not initiate or institute formal
condemnation proceedings declaring it necessary to acquire an interest in real property using
eminent domain as required in HUD Handbook 1378.0. Accordingly, the Housing Authority
intends to present to its Board of Commissioners a Resolution at an upcoming Regular Board
Meeting stating that the Housing Authority does not encourage the use of eminent domain and
requires that all matters which contemplate the use of formal condemnation proceedings by
eminent domain be presented to the Board of Commissioners for review and approval.
Additionally, the Housing Authority will continue to readily implement and follow
procedures by promptly requesting HUD approval prior to acquisition and/or sale of any and all
future property to better ensure compliance with Federal requirements when acquiring,
developing, and/or disposing of property.
In closing, the Housing Authority would like to thank you and your staff for your
diligence and professionalism in conducting this audit. While the Housing Authority is very
proud of the work it has done and the services it has been providing, we remain open to
suggestions for improvement to our programs and truly appreciate your assistance in further
refining and improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
Exit
Page 60 2002-CH-1801
Appendix B
August 6, 2001
Mr. Heath Wolfe
Assistant District Inspector General for Audit
U.S. Department of Housing and Urban Development
77 West Jackson Boulevard, Suite 2646
Ralph H. Metcalfe Federal Building
Chicago, IL 60604-3507
Re: Response of the Housing Authority of the City of Evansville, Indiana,
(Housing Authority) to the July 23, 2001 Draft Audit Report of the U.S.
Department of Housing and Urban Development Inspector General (HUD)
Dear Mr. Wolfe:
This letter responds to your correspondence of July 23, 2001 Draft Audit Report. I
have reviewed the third Draft Audit Finding of the Office of Inspector General for Audit, HUD
(“Draft Audit Findings”) submitted to me and provide the following comments on behalf of the
Housing Authority. The Housing Authority’s comments are set forth below:
HUD PROPOSED FINDING #3
“The Authority Did Not Exercise Sound Management Practices Over Its Construction
Steel”
RESPONSE- The Housing Authority agrees that it did not exercise sound management
practices over steel purchased for construction work in December, 1996. Accordingly, the
Housing Authority will:
a. Take appropriate and timely action to either use the remaining
steel for a Housing Authority project or sell the steel for its fair
market value.
b. Reimburse its Comprehensive Grant Program funds $1,730
from non-Federal funds for the steel decking that rusted and
was discarded.
c. Implement procedures and controls to ensure the Housing
Authority follows Federal requirements when purchasing
construction steel for future projects.
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Page 61 2002-CH-1801
Appendix B
In particular, the Housing Authority is scheduled to take possession of the remaining
steel from FabCon, the manufacturer of the steel, on August 14, 2001. The Housing
Authority’s Director of Special Programs has confirmed that the remaining steel is to be
delivered on August 14, 2001 to a vacant lot area at the Erie Homes Housing Development.
This vacant lot is located at the corner of 10th and Oak Streets and will be secured by
construction fencing. The Housing Authority’s Director of Special Programs has further
recommended the steel be used in the construction of a new Multi-Purpose Building at the
renovated Erie Homes Housing Development. Furthermore, the Housing Authority first
attempted to utilize the steel in its new construction of a twenty-four unit senior citizen public
housing building, however its Director of Special Programs stated that the Project Architect said
it could not be used in the architectural design of this facility.
d. The Housing Authority intends to continue to readily implement
procedures and controls to ensure it follows Federal
requirements when purchasing construction steel for future
projects.
Likewise, in July 2000, the Housing Authority’s Construction Manager and its
Construction Department/Staff were reorganized to report directly to the Director of Special
Programs. This reorganization was implemented as a safeguard to better ensure the Housing
Authority follows Federal requirements when expending Comprehensive Grant Program funds.
In closing, the Housing Authority would like to thank you and your staff for your
diligence and professionalism in conducting this audit. While the Housing Authority is very
proud of the work it has done and the services it has been providing, we remain open to
suggestions for improvement to our programs and truly appreciate your assistance in further
refining and improving our efforts.
Sincerely,
/signed/
Paul L. Fletcher
Executive Director
PF/cs
cc: Brent Bowen, Auditor, Office of Inspector General, Ohio State Office
Exit
Page 62 2002-CH-1801
Appendix C
Distribution
Regional Director, Midwest (2)
Senior Community Builder/State Coordinator, Indiana State Office
Director of Public Housing Hub, Cleveland Area Office (2)
Coordinator of Public Housing Program Center, Indiana State Office
Secretary, S (Room 10000)
Deputy Secretary, SD (Room 10100)
Senior Advisor to Deputy Secretary, SD (Room 10100)
Assistant to the Secretary for White House Liaison, S (Room 10216)
Press Secretary/Senior Communications Advisor to the Secretary, S (Room 10226)
Chief of Staff, S (Room 10000)
Acting Assistant Secretary for Administration, A (Room 10110)
Assistant Secretary for Congressional and Intergovernmental Relations, J (Room 10120)
Director of Departmental Equal Employment Opportunity, U (Room 2112)
Deputy Chief of Staff for Policy and Programs, S (Room 10226)
Deputy Chief of Staff for Intergovernmental Affairs, S (Room 10226)
Director of Center for Faith-Based and Community Initiatives, K (Room 10184)
Executive Officer for Administrative Operations and Management, S (Room 10220)
General Counsel, C (Room 10214)
Acting Assistant General Counsel, Midwest
Assistant Secretary for Housing-Federal Housing Commissioner, H (Room 9100)
General Deputy Assistant Secretary for Policy Development and Research, R (Room 8100)
Assistant Secretary for Community Planning and Development, D (Room 7100)
President of Government National Mortgage Association, T (Room 6100)
Acting Assistant Secretary for Fair Housing and Equal Opportunity, E (Room 5100)
Assistant Secretary for Public and Indian Housing, P (Room 4100)
General Deputy Assistant Secretary for Public and Indian Housing, P (Room 4100)
Acting Deputy Assistant Secretary for Public Housing Investments, PT (Room 4138)
Deputy Assistant CFO for Financial Management, FM (Room 2206)
Acting Deputy Assistant Secretary for Public and Assisted Housing Delivery, PH (Room 4202)
Deputy Assistant Secretary for Administration and Budget/CFO, PC (Room 4234)
Audit Liaison Officer for Public and Indian Housing, PF (Room 5156)
Chief Information Officer, Q (Room 8206)
Director of Departmental Operations and Coordination, I (Room 2124)
Chief Financial Officer, F (Room 2202)
Director of Audit Coordination/Departmental Audit Liaison Officer, FMA (Room 2206)
Director of Risk Management, FMR (Room 2214)
CFO Audit Liaison Officer, FMA (Room 2206)
Audit Liaison Officer, 3AFI (2)
Director of Enforcement Center, V (200 Portals Building)
Acting Director of Real Estate Assessment Center, X (1280 Maryland Avenue, SW,
Suite 800)
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Page 63 2002-CH-1801
Appendix C
Acting Director of Multifamily Assistance Restructuring, Y (4000 Portals Building)
Acquisitions Librarian, Library, AS (Room 8141)
Acting Director of Federal Housing Enterprise Oversight, O (Room 4011)
Director of Healthy Homes and Lead Hazard Control, L (3206 Portals Building)
Director of National Office of Labor Relations, SL (Room 7118)
Senior Advisor, Subcommittee on Criminal Justice, Drug Policy & Human Resources, B 373
Rayburn House Office Building, Washington DC 20515
The Honorable Fred Thompson, Ranking Member, Committee on Governmental Affairs, 340
Dirksen Senate Office Building, United States Senate, Washington DC 20510
The Honorable Joseph Lieberman, Chairman, Committee on Governmental Affairs, 706 Hart
Senate Office Building, United States Senate, Washington DC 20510
The Honorable Dan Burton, Chairman, Committee on Government Reform, 2185 Rayburn
Building, United States House of Representatives, Washington DC 20515
The Honorable Henry A. Waxman, Ranking Member, Committee on Government Reform,
2204 Rayburn Building, United States House of Representatives, Washington DC
20515
Cindy Fogleman, Subcommittee on Oversight and Investigations, Room 212, O'Neil House
Office Building, Washington DC 20515
Associate Director of Housing and Telecommunications Issues, United States General
Accounting Office, 441 G Street N.W., Room 2T23, Washington DC 20548
Steve Redburn, Chief of Housing Branch, Office of Management and Budget, 725 17th Street,
N.W., Room 9226, New Executive Office Building, Washington DC 20503
Andy Cochran, House Committee on Financial Services, 2129 Rayburn House Office Building,
Washington DC 20515
Executive Director, Housing Authority of the City of Evansville (5)
Vice Chairman of the Board of Commissioners, Housing Authority of the City of Evansville
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Page 64 2002-CH-1801
Housing Authority of the City of Evansville Hotline Complaint Evansville, Indiana
Published by the Department of Housing and Urban Development, Office of Inspector General on 2002-01-29.
Below is a raw (and likely hideous) rendition of the original report. (PDF)