oversight

HUD Subsidized an Estimated 2,094 to 3,046 Households That Included Lifetime Registered Sex Offenders

Published by the Department of Housing and Urban Development, Office of Inspector General on 2009-08-14.

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

                                                                  Issue Date
                                                                           August 14, 2009
                                                                  Audit Report Number
                                                                               2009-KC-0001




TO:        Milan Ozdinec, Deputy Assistant Secretary for Public Housing and
              Voucher Programs, PE

           Carole Galante, Deputy Assistant Secretary for Multifamily
              Housing Programs, HT

           //signed//
FROM:      Ronald J. Hosking, Regional Inspector General for Audit, 7AGA


SUBJECT: HUD Subsidized an Estimated 2,094 to 3,046 Households That Included
           Lifetime Registered Sex Offenders

                                    HIGHLIGHTS

 What We Audited and Why

             We audited the U.S. Department of Housing and Urban Development’s (HUD)
             requirement prohibiting lifetime registered sex offenders from admission to HUD-
             subsidized housing. We initiated this audit as part of our national annual audit
             plan.

             Our audit objective was to determine the extent to which HUD-subsidized
             housing was occupied by lifetime registered sex offenders.



 What We Found

             HUD subsidized an estimated 2,094 to 3,046 households that included lifetime
             registered sex offenders. As a result, it did not accomplish the objective of the
             statute to prevent admission of dangerous sex offenders, and the same offenders
           who were deemed too dangerous for admission were allowed to continue living in
           subsidized housing.



What We Recommend
          1

           We recommend that HUD seek legislative and program rule changes to require
           denial of continued occupancy and termination of tenancy, or continued subsidy
           as appropriate, for all lifetime registered sex offenders residing in subsidized
           housing. If legislative changes are passed, we recommend that HUD develop and
           implement a plan to detect lifetime registered sex offenders occupying subsidized
           housing.

           Additionally, we recommend that HUD require projects and housing authorities to
           revise their admission, screening, and recertification procedures and urge them to
           aggressively pursue termination of assistance for lifetime sex offenders to the
           extent currently allowed by law.

           For each recommendation without a management decision, please respond and
           provide status reports in accordance with HUD Handbook 2000.06, REV-3.
           Please furnish us copies of any correspondence or directives issued because of the
           audit.



Auditee’s Response

           We provided the discussion draft to HUD on June 30, 2009, requesting comments
           within 30 days. We provided a revised draft for comment on July 17, 2009. We
           received comments from the Office of Public and Indian Housing and the Office
           of Multifamily Housing dated August 5, 2009, and July 31, 2009, respectively.
           While HUD agreed with some recommendations, it generally disagreed with the
           key recommendations relating to requesting legislative changes and implementing
           additional requirements and controls.

           The complete text of the auditee’s response, along with our evaluation of that
           response, can be found in appendix B of this report.




                                            2
                            TABLE OF CONTENTS

Background and Objective                                                    4

Results of Audit
      Finding: HUD Subsidized an Estimated 2,094 to 3,046 Households That   5
                 Included Lifetime Registered Sex Offenders

Scope and Methodology                                                       11

Internal Controls                                                           13

Appendixes
   A. Schedule of Funds to Be Put to Better Use                             14
   B. Auditee Comments and OIG’s Evaluation                                 15




                                            3
                       BACKGROUND AND OBJECTIVE

The U.S. Department of Housing and Urban Development’s (HUD) Office of Multifamily
Housing Programs is responsible for the overall management, development, direction, and
administration of HUD’s multifamily housing programs. These programs include the project-
based Section 8 program, which provides rental subsidies for eligible program participants
residing in apartment projects.

HUD’s Office of Public and Indian Housing is responsible for ensuring the availability of safe,
decent, and affordable housing for eligible program participants. This office is responsible for
administering and managing the public housing and Housing Choice Voucher programs.

The Quality Housing and Work Responsibility Act of 1998 (the Act), Section 578, established
the ineligibility of dangerous sex offenders for admission to federally subsidized housing. The
Act was proposed in part because of a 1997 case in which a previously convicted sex offender
living in public housing was charged with assaulting and molesting a nine-year-old girl who
lived in the same building. The Act states that projects and housing authorities must prohibit
admission to subsidized housing of any household that includes a person who is subject to a
lifetime registration requirement under a state sex offender registration program.

While sex offender registration programs are different from state to state, the Sex Offender
Registration and Notification Act of 2006 provides a comprehensive set of minimum standards
for sex offender registration, including standards for requiring lifetime registration. The U.S.
Department of Justice maintains the Dru Sjodin National Sex Offender Public Website, which
searches registries for all 50 states, the District of Columbia, and the five principal U.S.
territories. Additionally, the Federal Bureau of Investigation (FBI) maintains the National Sex
Offender Registry database.

HUD established regulations for this requirement in 24 CFR (Code of Federal Regulations)
5.850-5.905. The requirement became effective on June 25, 2001. HUD provided additional
guidance in Public and Indian Housing Notice 2002-22 and HUD Handbook 4350.3, Occupancy
Requirements of Subsidized Multifamily Housing Programs.

HUD requires that projects and housing authorities adopt and incorporate into their screening
and admission policies the following mandatory provision: to deny admission to federally
subsidized housing if any member of the household is subject to a lifetime registration
requirement under a state sex offender registration program. During the admissions screening
process, projects and housing authorities must perform the necessary criminal history
background checks in the state where the housing is located and in other states where the
household members are known to have resided. Additionally, they must follow up with state and
local agencies as necessary to determine whether an applicant is subject to a lifetime registration
requirement under a state sex offender registration program.

Our audit objective was to determine the extent to which HUD-subsidized housing was occupied
by lifetime registered sex offenders.


                                                4
                                 RESULTS OF AUDIT

Finding: HUD Subsidized an Estimated 2,094 to 3,046 Households That
Included Lifetime Registered Sex Offenders

HUD subsidized an estimated 2,094 to 3,046 households that included lifetime registered sex
offenders. This condition occurred because HUD did not have adequate controls, monitoring,
and authority to ensure that projects and housing authorities prevented admission and continued
subsidy of lifetime registered sex offenders. As a result, it did not accomplish the objective of
the statute to prevent admission of dangerous sex offenders, and the same offenders who were
deemed too dangerous for admission were allowed to continue living in subsidized housing.




 HUD Subsidized Lifetime
 Registered Sex Offenders

               To conduct this audit, we identified 4,784 households in which one or more
               members’ Social Security numbers matched an offender in the FBI’s National Sex
               Offender Registry. We then selected a statistical sample of 67 of those households
               for review (see scope and methodology).

               Of the 67 sample households reviewed, 36 households included a lifetime
               registered sex offender. This number includes

                  •   18 household members who were ineligible at the time of admission due
                      to lifetime registration status,
                  •   10 household members who were admitted and convicted before the
                      current law was enacted, and
                  •   Eight household members who were eligible at the time of admission but
                      later became lifetime registered sex offenders.

               Based on the sample review results, we estimate that HUD actually subsidized
               between 2,094 and 3,046 households with lifetime registered sex offenders of the
               4,784 households initially indicated as including registered sex offenders.

               The 36 lifetime registered sex offenders identified in our sample were convicted
               of a variety of offenses, including rape, sexual assault, lewd or lascivious acts,
               and sexual abuse.

               Many of their offenses were against children. For example, one member who was
               admitted in 1990 was still living in subsidized housing despite a 2002 conviction
               of criminal attempt to commit rape of a five-year-old child. Another lifetime


                                                5
          registered sex offender was improperly admitted in 2008 despite a 2003
          conviction for first degree sexual abuse of a four-year-old child.

          Several offenders had multiple convictions. For example, one lifetime registered
          sex offender was improperly admitted in 2003 despite having four convictions
          spanning 15 years, including indecent assault and battery against a child under 14
          years of age.

          Additionally, several of the offenders were convicted as juveniles. For example,
          an eligible member who was admitted in 2007 at age 15 became a lifetime
          registered sex offender nearly two years later when he was convicted of criminal
          sexual assault and classified as a sexual predator. Another lifetime registered sex
          offender was improperly admitted in 2003 at age 13 despite having been
          convicted in 2002 for criminal sexual contact.


HUD Did Not Have Adequate
Controls, Monitoring, and
Authority
          HUD did not have adequate controls, monitoring, and authority to ensure that
          projects and housing authorities prevented admission and continued subsidy of
          lifetime registered sex offenders.

          For example, HUD did not expressly require projects and housing authorities to

             •   Ask applicants whether any member of the household was subject to a
                 lifetime registration requirement;
             •   Ask applicants to list the states previously lived in so that all required
                 criminal history background checks could be performed;
             •   Perform background checks on juvenile household members to the extent
                 allowed by state and local law; and
             •   Retain documentation showing the date, type, and results of all criminal
                 history background checks performed with law enforcement agencies
                 when actual reports were destroyed as required by law.

          Additionally, because current laws and regulations only prohibit admission and do
          not prohibit offenders convicted after admission or those who were both admitted
          and convicted before the current law was enacted, HUD also did not require
          projects and housing authorities to

             •   Ask households at each recertification whether any member was subject to
                 a lifetime registration requirement or
             •   Check the Dru Sjodin National Sex Offender Public Website for all
                 household members at each recertification.



                                           6
            Further, current laws do not include a provision prohibiting continued subsidy of
            lifetime registered sex offenders, including those improperly admitted. As a
            result, HUD had not established authority to terminate tenancy, or continued
            subsidy as appropriate, of lifetime registered sex offenders and had not developed
            procedures to detect lifetime registered sex offenders currently living in
            subsidized housing, such as by matching National Sex Offender Registry data to
            its databases.


Dangerous Offenders
Continued to Live in Subsidized
Housing
            HUD did not accomplish the objective of the statute to prevent admission of
            dangerous sex offenders. Also, because current laws do not prohibit continued
            subsidy of lifetime registered sex offenders and HUD had not established the
            authority to prevent this situation, the same types of offenders who were deemed
            too dangerous for admission were allowed to continue living in subsidized
            housing.


Long-Term and Short-Term
Changes Are Needed To Protect
Residents
            If HUD implements our recommendations, it will be better equipped to prevent
            and detect admission and continued subsidy of lifetime registered sex offenders.
            Specifically, if HUD can persuade Congress to pass appropriate legislation, we
            estimate that it could prevent more than $12 million in housing assistance and
            subsidies from being spent over the next year on households with dangerous sex
            offenders. It will also provide a safer living environment for people in the
            immediate vicinity of these households.

            Because legislative changes may take time, we also recommend that HUD urge
            projects and housing authorities to aggressively pursue termination of tenancy, or
            continued subsidy as appropriate, for lifetime sex offenders to the extent currently
            allowed by law. This could include those who have lied on application or
            recertification forms or are otherwise covered by project or housing authority
            policies to terminate assistance of residents whose criminal activity threatens the
            safety of other residents.

            To assist with the implementation of these long-term and short-term solutions, we
            also recommend that HUD require projects and housing authorities to revise
            admission and recertification procedures to better detect lifetime registered sex
            offenders.




                                             7
    Recommendations

                 We recommend that the Deputy Assistant Secretary for Public Housing and
                 Voucher Programs

                 1A. Seek legislative and program rule changes to require denial of continued
                     occupancy and termination of tenancy, or continued subsidy as appropriate,
                     for all lifetime registered sex offenders residing in subsidized housing to
                     annually put more than $12 million to better use1.

                 1B. Require housing authorities to formally ask households before admission for
                     a list of all states in which they have resided and whether any member is
                     subject to a lifetime registration requirement.

                 1C. Require housing authorities to document their consideration before
                     admission of whether each household member is subject to lifetime
                     registration (including the date, type, and results of criminal history
                     background checks performed with law enforcement agencies; and any other
                     contact with sex offender registries and law enforcement agencies) when
                     actual reports are destroyed as required by law.

                 1D. Develop and implement controls to monitor housing authority use of the
                     required application questions and retention of appropriate background
                     check documentation.

                 1E. Urge housing authorities to ask households at each recertification whether
                     any member is subject to a lifetime registration requirement.

                 1F. Urge housing authorities to check the Dru Sjodin National Sex Offender
                     Website for all household members at each recertification.

                 1G. Urge housing authorities to aggressively pursue termination of tenancy, or
                     continued subsidy as appropriate, for lifetime sex offenders to the extent
                     currently allowed by law, to include those who have lied on application or
                     recertification forms or are otherwise excluded by housing authority policy.

                 1H. If legislative changes are passed (see recommendation 1A), require housing
                     authorities to ask households at each recertification whether any member is
                     subject to a lifetime registration requirement.




1
  Because our sample universe consisted of both public housing and multifamily programs, we cannot statistically
break the $12 million estimate out between the two program areas. Therefore, while this estimate is cited in both
recommendations 1A and 1L, we are only claiming the funds to put to better use once (see appendix A).


                                                         8
                 1I.    If legislative changes are passed (see recommendation 1A), require housing
                        authorities to check the Dru Sjodin National Sex Offender Website for all
                        household members at each recertification.

                 1J.    If legislative changes are passed (see recommendation 1A), develop and
                        implement controls to monitor housing authority use of the required
                        recertification questions and use of the Dru Sjodin National Sex Offender
                        Public Website.

                 1K. If legislative changes are passed (see recommendation 1A), develop and
                     implement a plan to detect lifetime registered sex offenders occupying
                     subsidized housing, such as by matching National Sex Offender Registry
                     database to its own data and then following up on preliminary matches.


                 We recommend that the Deputy Assistant Secretary for Multifamily Housing
                 Programs

                 1L. Seek legislative and program rule changes to require denial of continued
                     occupancy and termination of tenancy for all lifetime registered sex
                     offenders residing in subsidized housing to annually put more than $12
                     million to better use2.

                 1M. Require properties to formally ask households before admission for a list of
                     all states in which they have resided and whether any member is subject to a
                     lifetime registration requirement.

                 1N. Require properties to document their consideration before admission of
                     whether each household member is subject to lifetime registration (including
                     the date, type, and results of criminal history background checks performed
                     with law enforcement agencies; and any other contact with sex offender
                     registries and law enforcement agencies) when actual reports are destroyed
                     as required by law.

                 1O. Develop and implement controls to monitor properties’ use of the required
                     application questions and retention of appropriate background check
                     documentation.

                 1P. Urge properties to ask households at each recertification whether any
                     member is subject to a lifetime registration requirement.

                 1Q. Urge properties to check the Dru Sjodin National Sex Offender Website for
                     all household members at each recertification.

2
  Because our sample universe consisted of both public housing and multifamily programs, we cannot statistically
break the $12 million estimate out between the two program areas. Therefore, while this estimate is cited in both
recommendations 1A and 1L, we are only claiming the funds to put to better use once (see appendix A).


                                                         9
1R. Urge properties to aggressively pursue termination of tenancy for lifetime
    sex offenders to the extent currently allowed by law, to include those who
    have lied on application or recertification forms or are otherwise excluded
    by property policy.

1S. If legislative changes are passed (see recommendation 1L), require
    properties to ask households at each recertification whether any member is
    subject to a lifetime registration requirement.

1T. If legislative changes are passed (see recommendation 1L), require
    properties to check the Dru Sjodin National Sex Offender Website for all
    household members at each recertification.

1U. If legislative changes are passed (see recommendation 1L), develop and
    implement controls to monitor properties’ use of the required recertification
    questions and use of the Dru Sjodin National Sex Offender Public Website.

1V. If legislative changes are passed (see recommendation 1L), develop and
    implement a plan to detect lifetime registered sex offenders occupying
    subsidized housing, such as by matching National Sex Offender Registry
    database to its own data and then following up on preliminary matches.




                                10
                          SCOPE AND METHODOLOGY

To accomplish our objective, we

   •   Reviewed applicable laws and regulations,
   •   Interviewed key HUD staff to gain an understanding of relevant controls,
   •   Analyzed computer-processed data contained in HUD’s Public and Indian Housing Center
       (PIC) and Tenant Rental Assistance Certification System (TRACS),
   •   Analyzed computer-processed data contained in the FBI’s National Sex Offender Registry
       (NSOR),
   •   Used auditing software to select a statistical sample of households likely to include sex
       offenders,
   •   Evaluated the results of the statistical sample to estimate the number of HUD-subsidized
       households that included lifetime registered sex offenders.

To assess the reliability of PIC and TRACS data, we reviewed prior audits and assessments,
performed analytical procedures to verify that data fields contained expected values, and traced
information to source documents for sampled items. We determined that the computer-processed
data were sufficiently reliable for our purposes because the data were corroborated by documentary
evidence supplied by projects and housing authorities.

To assess the reliability of NSOR data, we performed analytical procedures to verify that data fields
contained expected values and reviewed reports. To the extent possible, we also traced the data to
state sex offender registry web sites and confirmed key information with relevant state law
enforcement agencies. We determined that the computer-processed data were sufficiently reliable
for our purposes because the data were corroborated by the state registry web sites and law
enforcement agencies.

We identified records in PIC and TRACS for 4,158,133 households nationwide participating in
various public housing and multifamily programs. We identified records in NSOR for 570,699
registered sex offenders. We then matched the household member Social Security numbers
contained in PIC and TRACS to the available Social Security numbers contained in NSOR. We
determined that 4,784 households had at least one member’s Social Security number that matched a
Social Security number contained in NSOR.

We developed an attribute sampling plan using a 90 percent confidence level with 10 percent
desired precision and 50 percent estimated error rate. We then used the Army Audit Agency’s
statistical sampling software to calculate the sample size and a random number generator to identify
the sample items. The sampling plan resulted in a sample size of 67 households.

For each of the 67 households sampled, we contacted the project or housing authority to obtain all
relevant documentation for the subject household members. This documentation included the date
of admission, initial application, identifications obtained, list of background checks completed,
initial and current Form HUD-50058 or -50059 certification forms, and policies and procedures for
determining eligibility at admission.


                                                 11
We then evaluated each sample household to determine whether households included a lifetime
registered sex offender by performing a comprehensive review of relevant HUD and NSOR data,
project and housing authority documentation, and sex offender web site information. We also
followed up with state and local law enforcement to confirm conviction and length of registration
information.

After evaluating all of the sample items, we projected the results of 36 lifetime registered sex
offenders to the sampling universe. We statistically estimate that of the 4,784 households we
identified as including a registered sex offender, between 2,094 and 3,046 include lifetime
registered sex offenders, resulting in an estimated $12,564,000 in annual housing assistance and
subsidies that could be better spent on households without dangerous sex offenders. This
estimate is based on a weighted cost figure of the average annual housing assistance and
subsidies cost for each of the three major programs covered in our sample universe (public
housing, tenant-based rental assistance, and project-based rental assistance) using 2009 actual
budget figures and the number of units for each program according to HUD’s web site.

Our audit period generally covered December 2008 through March 2009. Specifically, the data
contained in PIC and TRACS were as of January 2009 and December 2008, respectively, and the
data contained in NSOR were as of March 2009. We expanded the period as necessary. We
conducted the audit from our office in St. Louis, Missouri, from October 2008 through May
2009.

We conducted the audit in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain sufficient, appropriate
evidence to provide a reasonable basis for our findings and conclusions based on our audit
objective. We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objective.




                                                12
                              INTERNAL CONTROLS

Internal control is an integral component of an organization’s management that provides
reasonable assurance that the following controls are achieved:

   •   Program operations,
   •   Relevance and reliability of information,
   •   Compliance with applicable laws and regulations, and
   •   Safeguarding of assets and resources.

Internal controls relate to management’s plans, methods, and procedures used to meet its
mission, goals, and objectives. They include the processes and procedures for planning,
organizing, directing, and controlling program operations as well as the systems for measuring,
reporting, and monitoring program performance.



 Relevant Internal Controls

              We determined that the following internal controls were relevant to our audit
              objective:

              •       Policies and procedures to prevent lifetime registered sex offenders from
                      admission to HUD-subsidized housing.

              We assessed the relevant controls identified above.

              A significant weakness exists if management controls do not provide reasonable
              assurance that the process for planning, organizing, directing, and controlling
              program operations will meet the organization’s objectives.


 Significant Weaknesses

              Based on our review, we believe that the following item is a significant weakness:

              •       HUD did not have adequate controls to prevent the admission of lifetime
                      registered sex offenders to HUD-subsidized housing (see finding).




                                               13
                                   APPENDIXES

Appendix A

     SCHEDULE OF FUNDS TO BE PUT TO BETTER USE



                            Recommendation       Funds to be put
                                   number         to better use 1/
                                          1A        $12,564,000


1/   Recommendations that funds be put to better use are estimates of amounts that could be
     used more efficiently if an Office of Inspector General (OIG) recommendation is
     implemented. These amounts include reductions in outlays, deobligation of funds,
     withdrawal of interest, costs not incurred by implementing recommended improvements,
     avoidance of unnecessary expenditures noted in preaward reviews, and any other savings
     that are specifically identified.

     In this instance, if HUD can persuade Congress to pass appropriate legislation as
     recommended, we estimate that it could prevent more than $12 million in housing
     assistance and subsidies from being spent over the next year on households with
     dangerous sex offenders. Projects and housing authorities will instead spend those funds
     to house other residents. Once appropriate legislation is passed and HUD can implement
     relevant controls, monitoring, and detection, this will be a recurring benefit. However,
     our estimate only reflects the initial year of this benefit. These amounts do not include
     potential offsetting costs incurred by HUD to implement our recommendations.




                                            14
Appendix B

        AUDITEE COMMENTS AND OIG’S EVALUATION

Ref to OIG Evaluation   Auditee Comments




Comment 1



Comment 2



Comment 3




                         15
Ref to OIG Evaluation   Auditee Comments




Comment 4




Comment 5




                         16
Ref to OIG Evaluation   Auditee Comments




Comment 6




Comment 7




Comment 8




                         17
Ref to OIG Evaluation   Auditee Comments




Comment 8




Comment 9




Comment 10




                         18
Ref to OIG Evaluation   Auditee Comments




Comment 10




Comment 10




Comment 10




                         19
Ref to OIG Evaluation   Auditee Comments




Comment 1


Comment 2




                         20
Ref to OIG Evaluation   Auditee Comments




Comment 4




Comment 3




Comment 5




                         21
Ref to OIG Evaluation   Auditee Comments




Comment 11




Comment 12




                         22
Ref to OIG Evaluation   Auditee Comments




Comment 8




Comment 8




Comment 8




                         23
Ref to OIG Evaluation   Auditee Comments




Comment 13




Comment 13




Comment 13




Comment 13




                         24
                         OIG Evaluation of Auditee Comments

Comment 1   In accordance with our audit objective, we tested to determine the extent to which
            HUD-subsidized housing was occupied by lifetime registered sex offenders and
            our recommendations address the weaknesses identified which allowed these
            lifetime offenders to occupy subsidized housing. Because our focus was on the
            extent of exceptions, we did not perform testing which would allow us to make a
            general conclusion on housing authority (and project) compliance with the law.
            We did not perform testing to determine the extent to which housing authorities
            (and projects) have properly denied admission to other lifetime offenders or the
            extent to which they performed proper background screening on remaining
            participants.

Comment 2   The Office of Public and Indian Housing’s purpose is to ensure safe, decent, and
            affordable housing. Similarly, the Office of Multifamily Housing oversees
            assisted properties to assure they meet the Department’s goal to provide decent,
            safe, and sanitary housing to low-income families. While the percentage of
            lifetime sex offenders in assisted housing is relatively small, HUD can better
            fulfill this purpose by implementing additional procedures and controls to prevent
            these instances.

Comment 3   We added a footnote to the recommendation further explaining the $12 million
            estimate. However, because our sample universe consisted of both public housing
            and multifamily programs, we cannot break this estimate out between the two
            program areas. Additionally, our projection is based on household members who
            were ineligible at the time of admission as well as those admitted and convicted
            before the current law and those who became lifetime offenders after admission
            because we are requesting legislative changes impacting all three groups.

Comment 4   We strongly believe that additional legislation is necessary for several reasons:
              • In a March 2009 case (Miller v. McCormick), a United States District
                   Court pointed out that current regulations do not authorize termination of
                   lifetime offenders who avoid the ban and become program participants.
                   This precedent presents problems for housing authorities (and projects)
                   seeking to terminate assistance for sex offenders improperly admitted.
              • Further, current regulations do not expressly address offenders who were
                   admitted prior to the current law or those who became offenders after
                   admission. While it is true that housing authorities (and projects) have
                   some authority to terminate assistance for activity that threatens the safety
                   of other residents, current regulations do not require it.
              • Accordingly, as highlighted in the finding and in recommendations (see
                   1E, 1F, 1H, 1I, 1P, 1Q, 1S, 1T), there are currently no detection methods
                   in place to identify members who become lifetime registered sex offenders
                   after admission.

Comment 5   We believe that this recommendation is necessary. In order for housing
            authorities (and projects) to perform the required background checks in all states
                                             25
              in which households are known to have resided in, they must first ask for a list of
              these states. Our sample testing indicated that housing authorities (and projects)
              are not currently doing this. Therefore, we are simply asking for HUD to require
              housing authorities (and projects) to properly document this question, along with
              a question asking if any household member is subject to a lifetime registration
              requirement.

Comment 6     While housing authorities are currently required to destroy actual criminal history
              background checks, we believe it is necessary for them to document performance
              of the required checks, including the date, type and general results. Without this
              basic documentation, HUD cannot confirm whether housing authorities are
              properly screening applicants.

Comment 7     While HUD does not need to change its risk analysis, it can add these specific
              items to the monitoring plans once housing authorities are selected for review.

Comment 8     HUD agrees to implement our recommendation. HUD’s response to this
              recommendation highlights the importance of new legislation. Without it, HUD
              can only recommend this improved control, but it has no authority to require it.

Comment 9     HUD agrees to implement our recommendation. However, note that housing
              authorities are unable to pursue termination for those who become lifetime
              registered sex offenders after admission unless they first detect the change in
              status. We would not currently expect housing authorities to detect members who
              become lifetime offenders after admission because HUD does not require
              proactive detection at recertification (see finding and recommendations 1E, 1F,
              1H, 1I).

Comment 10 HUD agrees to implement our recommendation if legislative changes are enacted.

Comment 11 The June 2009 clarification to HUD Handbook 4350.3 should satisfy this
           recommendation in cases where the owner/agent obtains the criminal background
           check. However, in cases where housing authorities obtain the criminal
           background check, we believe it is necessary for the project to document
           performance of the required checks, including the date, type and general results
           (when actual reports are destroyed). Without this basic documentation, HUD
           cannot confirm whether housing authorities are properly screening applicants.

Comment 12 Recommendations 1M and 1N are requesting HUD to implement new
           requirements for projects. Accordingly, HUD needs to add these specific
           requirements to its current review process.

Comment 13 HUD agrees to implement our recommendation if legislative changes are enacted.
           We will revise this recommendation to reference 1L. However, because they are
           separate actions, we will not combine recommendations 1S through 1V.




                                               26