OFFICE OF AUDIT
REGION 2
NEW YORK-NEW JERSEY
New Brunswick Housing Authority
New Brunswick, NJ
Recovery Act Capital Fund Program
2013-NY-1007 JUNE 21, 2013
Issue Date: June 21, 2013
Audit Report Number: 2013-NY-1007
TO: Sonia Burgos
Director, Office of Public Housing, Newark Field Office, 2FPH
//SIGNED//
FROM: Edgar Moore
Regional Inspector General for Audit, New York-New Jersey Region, 2AGA
SUBJECT: Authority Officials Generally Administered Recovery Act Funds in Accordance
With Requirements but Budgetary and Procurement Controls Had Weaknesses
Enclosed is the U.S. Department of Housing and Urban Development (HUD), Office of
Inspector General’s (OIG) final results of our audit of the New Brunswick, NJ, Housing
Authority’s administration of its Recovery Act Capital Fund Program.
HUD Handbook 2000.06, REV-4, sets specific timeframes for management decisions on
recommended corrective actions. For each recommendation without a management decision,
please respond and provide status reports in accordance with the HUD Handbook. Please furnish
us copies of any correspondence or directives issued because of the audit.
The Inspector General Act, Title 5 United States Code, section 8L, requires that OIG post its
publicly available reports on the OIG Web site. Accordingly, this report will be posted at
http://www.hudoig.gov.
If you have any questions or comments about this report, please do not hesitate to call me at
(212) 264-4174.
June 21, 2013
Authority Officials Generally Administered Recovery Act
Funds in Accordance With Requirements but Budgetary
and Procurement Controls Had Weaknesses
Highlights
Audit Report 2013-NY-1007
What We Audited and Why What We Found
We audited the Housing Authority of Authority officials obligated and expended
the City of New Brunswick’s American Recovery Act funds for eligible activities within
Recovery and Reinvestment Act required timeframes; however, there were
Capital Fund Program based upon a weaknesses in budgetary controls, and officials did
risk analysis of authorities administered not always adequately document the procurement
through the Newark, NJ field office, history in compliance with applicable regulations
which considered the funding received or properly report Recovery Act-funded activities.
and the U.S. Department of Housing Specifically, (1) $56,993 was expended prior to
and Urban Development’s (HUD) Board approval and $107,319 was expended in
assigned risk score. The objectives of excess of the approved budget; (2) two of five
the audit were to determine whether contracts lacked sufficient documentation to show
Authority officials (1) obligated and that procurements were based upon a complete
expended their funds in accordance cost analysis and a detailed scope of work; and (3)
with the Recovery Act and HUD $157,701 expended for labor cost was not
regulations, and (2) complied with adequately supported. In addition, reporting of
Recovery Act reporting requirements. Recovery Act-funded activity did not reconcile
with approved budgets or the actual work
performed. We attribute these deficiencies to
What We Recommend
inadequate oversight and unfamiliarity by
Authority officials with Recovery Act and HUD
We recommend that HUD instruct reporting requirements. As a result, HUD lacks
Authority officials to (1) provide assurance that procurement of security cameras
support for the board approval of the was executed in the most economical manner, and
$107,319 expended in excess of the accurate information on the expenditure of
amount authorized for the installation Recovery Act funds was reported.
of security cameras; (2) provide
documentation to adequately support
that the $157,701 paid for installation
and maintenance labor costs was
reasonable and that the costs were
incurred; (3) strengthen procurement,
financial, and budgetary controls; and
(4) ensure that any future reporting of
activities undertaken with grant funds
complies with applicable reporting
requirements.
TABLE OF CONTENTS
Background and Objectives 3
Results of Audit 4
Finding: Authority Officials Generally Administered Recovery Act
Funds in Accordance With Requirements but Budgetary and
Procurement Controls Had Weaknesses
Scope and Methodology 10
Internal Controls 11
Appendixes
A. Schedule of Questioned Costs 13
B. Auditee Comments and OIG’s Evaluation 14
2
BACKGROUND AND OBJECTIVES
The New Brunswick Housing Authority is a nonprofit corporation created in 1947 under Federal and
State housing laws as defined by New Jersey State statute1 for the purpose of engaging in the
development, acquisition, and administrative activities of the low-income housing program and other
programs with similar objectives for low- and moderate-income families residing in New Brunswick,
NJ, in accordance with the rules and regulations prescribed by the U.S. Department of Housing and
Urban Development (HUD). The Authority is governed by a seven-member board of commissioners,
which appoints an executive director to manage the Authority’s day-to-day operations. HUD data
disclosed that the Authority operated 487 low-rent units and administered 903 Housing Choice
Voucher program units.
On February 17, 2009, the President signed the American Recovery and Reinvestment Act of 2009,
Public Law 111-5. The Act provided $4 billion for public housing authorities to fund capital and
management activities, as authorized under Section 9 of the United States Housing Act of 1937. The
Recovery Act provided that $3 billion be distributed as formula grants and the remaining $1 billion be
distributed through a competitive grant process.
The Recovery Act required that funds be obligated within 1 year of the date on which funds became
available to an authority for obligation, 60 percent of the funds be expended within 2 years, and 100
percent be expended within 3 years of such date. HUD awarded the Authority more than $1.28 million
via a formula grant, which was made available to the Authority on March 18, 2009.
The objectives of the audit were to determine whether Authority officials obligated and expended their
funds in accordance with the Recovery Act and HUD regulations and complied with Recovery Act
reporting requirements.
1
N.J., S.A. 4A: 12A-1, et. Seq. the Housing Authority Act
3
RESULTS OF AUDIT
Finding: Authority Officials Generally Administered Recovery Act Funds in
Accordance With Requirements but Budgetary and Procurement
Controls Had Weaknesses
Although Authority officials obligated and expended their Recovery Act capital funds for eligible
activities within required timeframes, there were weaknesses in budgetary controls, and officials did
not always adequately document the procurement history in compliance with applicable regulations or
properly report Recovery Act-funded activities. Specifically, (1) $56,993 was expended prior to Board
approval and $107,319 was expended in excess of the approved budget; (2) two of five contracts lacked
sufficient documentation to show that procurements were based upon a complete cost analysis and a
detailed scope of work; and (3) $157,701 expended for labor costs were not adequately supported. In
addition, the officials’ reporting of their Recovery Act-funded activity did not reconcile with the
approved budgets or the work performed. We attribute these deficiencies to inadequate oversight and
unfamiliarity by Authority officials with Recovery Act and HUD reporting requirements. As a result,
Authority officials could not provide HUD adequate assurance that all procurement actions were made
in the most economical manner, as they expended $107,319 more than the board authorized for the
purchase and installation of security cameras, lacked adequate support for labor costs of $157,701; and
did not accurately report Recovery Act-funded activities to HUD and the public.
Funds Obligated and Expended
for Eligible Activity within
Recovery Act Timeframes
Manner
Authority officials obligated more than $1.28 million in Recovery Act capital funds by
the March 17, 2010, Recovery Act obligation deadline and had expended all funds by
the March 17, 2012, expenditure deadline. The funds were obligated and expended for
five contracts awarded for the following eligible activities previously identified in the
Authority’s annual plan:
Activity Amount obligated Amount expended
Purchase and installation of $ 577,803 $ 653,273
security cameras
Exterior lighting $ 173,000 $ 173,000
replacement
Masonry repair and stair $ 118,000 $ 116,693
replacement
Roof, gutters, doors, and $ 417,000 $ 342,837
windows replacement
Total $1,285,803 $1,285,803
4
Funds Expended Before Board
Approval and Contrary to
Budget
While all Recovery Act capital funds were expended for eligible activities, some funds
were spent before Board approval. The Authority’s procurement policy, section F,
entitled “Contract Modifications/Change Orders,” provides that board approval be
obtained for contract modifications or changes which extend the scope of work, services,
or supplies beyond the scope of the original contract. Authority officials expended
$56,993 on January 20, 2010, prior to Board approval, as part of a $277,803
procurement for the additional purchase and installation of security cameras2. However,
Authority officials obligated3 the $277,803 on February 4, 2010, which was prior to
board approval on February 24, 2010, and issued a “notice to proceed” to the contractor
on February 25, 2010.
In addition, funds were not spent in accordance with the approved budget. Regulations
at 24 CFR (Code of Federal Regulations) 85.20 (b) (4) require that a grantee financial
management system meet the budget control standard that actual expenditures or outlays
be compared with budgeted amounts for each grant, and financial information must be
related to performance or productivity data. As shown below, Authority officials
initially budgeted $300,000 for security cameras under budget line item 1475, non-
dwelling equipment and reported their revised budget in the final Performance and
Evaluation Report (P&ER) by adding $277,803 for security system under budget line
item 1460, dwelling. However, they expended $653,273 in Recovery Act funds for this
activity, which was allocated among three different budget categories without an
additional budget revision: $56,993, $296,280, and $300,000 to budget line items 1450
(site improvement), 1460 and 1475, respectively.
2
This procurement was in addition to an earlier $300,000 procurement in April 2009 for the purchase and installation of
security cameras.
3
While these funds were obligated after expenditure of $56,993, Authority officials obligated the funds within the
timeframe required by the Recovery Act.
5
Final performance and
Annual statement evaluation report Drawdowns
Budget line
item Activity Amount Activity Amount Activity Amount
Grading and
irrigation, Masonry work,
Security system $ 56,993
repair- Repair, replace-
1450 (site
replacement ment of
improve-
of exterior exterior stairs,
ment) Exterior lighting 143,007
stairs, railings, and
replacement
railings, and foundation
$200,000 $200,000 $200,000
foundation
Replacement of
Masonry work $ 116,692
exterior
window and
Roof, gutter, 342,838
doors
Replacement window, and
1460
of exterior door repair
(dwelling Replacement of
windows and
structures) roofs and
doors Exterior lighting
gutters
replacement 29,993
Security
Security system 296,280
$785,803 systems $785,803
$ 785,803
Security Security Security
1475 (non-
cameras and cameras and cameras and
dwelling
camera camera camera
equipment) $300,000 $300,000 $300,000
installations installations installation
These conditions occurred because Authority officials did not have adequate controls to
obtain Board approval prior to obligation and track expenditures to ensure they did not
exceed budgeted amounts. As a result, Authority officials eventually spent $685,122
($653,273 from Recovery Act funds and $31,849 from their 2008 and 2009 Capital
Fund Program grants) for the purchase and installation of security cameras, which was
$107,319,4 or 18.6 percent, more than what was authorized by the board.
Weaknesses in Procurement
Documentation
Authority officials lacked adequate documentation to show that the purchase and
installation of security cameras complied with regulations at 24 CFR 85.36(f)(1) which
require that a cost or price analysis be performed in connection with every procurement
action, including contract modifications, unless price reasonableness can be established
on the basis of a catalog or market price of a commercial product sold in substantial
quantities to the general public. Consequently, they could not provide assurance that the
4
The $107,319 is the difference between the total cost of $685,122 and the total amount obligated of $577,803 ($300,000
and $277,803) for purchase and installation of security cameras.
6
procurement was made in the most economical manner and that all payments were
adequately supported. We attribute this condition to Authority officials’ unfamiliarity
with procurement requirements and weaknesses in maintenance of documentation.
On April 23, 2009, and February 25, 2010, Authority officials issued two “notice to
proceed” orders to an authorized service provider of a General Services Administration
(GSA) Schedule contractor5, with whom they had previously contracted6, for the
purchase and installation of security cameras not to exceed $300,000 and $277,803,
respectively. GSA encourages state and local government entities to use GSA's Schedule
Ordering Procedures in Federal Acquisition Regulation (FAR) 8.4 to ensure the benefit
of receiving the best value from GSA Schedule contractors, and allows State and local
government entities to use GSA Advantage7 to locate GSA-approved prices for specific
equipment. Federal Acquisition Regulation 8.405-2 further provides that when ordering
Schedule 84 contract services priced at hourly rates, the purchasers must develop a
statement of work, which includes a description and location of the work to be
performed, the period of performance, deliverable schedule, and applicable performance
standards. However, the two “notice to proceed” orders did not comply with this
statement of work provision because they merely stated that the Authority would use the
company’s service to purchase and install security cameras and systems at its public
housing sites and indicated the amounts not to be exceeded of $300,000 and $277,803,
respectively. Further, documentation was lacking to verify that 9 of 11 equipment price
quotes were based on the GSA-approved prices and costs of $157,7018 had been
incurred and were fair and reasonable.
Recovery Act-Funded Activities
Not Accurately Reported
While Authority officials reported their Recovery Act-funded activity to
FederalReporting.gov in a timely manner, they did not accurately report their activities.
Although $653,273 was spent on security camera installation, the officials reported that
the entire $1,285,803 in Recovery Act funds was expended on such activity. This
condition occurred because Authority officials were unfamiliar with Recovery Act and
HUD reporting requirements.
5
Contractors that successfully complete a proposal process receive a GSA Schedule contract number. Under Schedules 70
and 84, the contractors agree to participate in the GSA Cooperative Purchasing Program, which allows state and local
governments to purchase a variety of commercial supplies (products) and services at negotiated prices.
6
On April 16, 2009, Authority officials executed a $12,208 contract based upon a sealed bid procurement for the purchase
and installation of a command center computer server manufactured by the GSA Schedule Contractor.
7
GSA Advantage provides eligible entities access to millions of commercial products and services from GSA-negotiated
contracts.
8
The amount includes $102,564 from 814 unsupported hours (2,259 service hours billed minus 1,445 hours supported by
certified payroll data from December 2009 to October 2010) at a $126 hourly rate, one flat charge of $28,782 without any
detailed hours, and a charge of $26,355 (251 service hours at a maintenance hourly rate of $105) without any description as
to why maintenance was needed for newly installed equipment.
7
In addition, as noted in the Table on page 6, Authority officials submitted a final
Performance and Evaluation Report that did not reflect how its Recovery Act funds were
drawn down and actually spent. HUD requires that the Annual Statement/Performance
and Evaluation Report form to be used to report on the use of Capital Fund Program
funds. According to the Annual Statement/Performance and Evaluation Report form,
revisions to the Annual Statement which are not significant deviations or significant
amendment/modifications to an Authority’s PHA plan, must be reported in the
Performance and Evaluation Report with the revisions to the Annual Statement. Further,
a revised form is required to be submitted when there are significant deviations or
significant amendment/modifications to the approved Annual Statement. However,
Authority officials did not request a budget revision or submit a revised final
Performance and Evaluation Report to reflect how the Recovery Act funds were actually
spent. As a result, HUD and the public were not accurately informed of the Authority’s
use of its Recovery Act funds.
Conclusion
Although Authority officials obligated and expended their Recovery Act capital funds
for eligible activities within required timeframes, there were weaknesses in budgetary
controls, and officials did not always document procurements in compliance with
applicable regulations or properly report Recovery Act-funded activities. We attribute
these deficiencies to inadequate oversight and unfamiliarity by Authority officials with
Recovery Act and HUD reporting requirements. As a result, Authority officials could
not provide HUD adequate assurance that some procurements were made in the most
economical manner and Recovery Act-funded activities were accurately reported to
HUD and the public.
Recommendations
We recommend that the Director, New Jersey Office of Public Housing, instruct
Authority officials to
1A. Strengthen budgetary controls to track expenditures against budgeted amounts to
ensure that funds are expended in accordance with approved budgets.
1B. Provide support for board approval of the $107,319 expended in excess of the
amount authorized in the “notices to proceed” for the installation of security
cameras, and if board approval was not obtained, repay these funds.
1C. Strengthen financial controls to ensure that funds are not disbursed before board
approval and obligation of funds to comply with Authority procedures.
1D. Strengthen procurement controls to ensure that procurement actions comply with
regulations regarding adequate documentation of cost analyses and scope of
work specifications.
8
1E. Provide documentation to adequately support that $157,701 paid for installation
and maintenance costs was reasonable and that the costs were incurred. If
documentation is not provided, repay these funds.
1F. Prepare and submit to HUD a revised final performance and evaluation report
that reflects the actual activities and costs incurred.
1G. Ensure that any future required reporting of activities undertaken with grant
funds complies with applicable reporting requirements.
9
SCOPE AND METHODOLOGY
To accomplish our objectives, we performed the following steps as they related to the Authority’s
Recovery Act Public Housing Capital Fund formula grant:
Reviewed relevant laws, regulations, and HUD and GSA policies and guidance to become
familiar with Recovery Act and applicable procurement requirements.
Reviewed the Authority’s board of commissioners’ resolutions to confirm that the Authority
had adopted a Recovery Act-compliant procurement policy.
Reviewed the Authority’s audited financial statements for fiscal years 2009, 2010, and 2011 to
identify trends and potential irregularities.
Reviewed the Authority’s Recovery Act Capital Fund formula grant agreement, annual
statement, 5-year plan, and procurement and accounting policies to become familiar with
conditions governing the funds.
Interviewed Authority and HUD staff.
Reviewed the five contract files for which more than $1.28 million was expended to document
the advertising, cost estimate, invitation to bid, bid documents, references, recommendation for
award, notice of award, notice to proceed, board resolution, and contracts.
Reviewed all drawdowns for more than $1.28 million to document whether funds were
obligated and expended in a timely manner.
Reviewed Recovery Act reporting documents and reports submitted to FederalReporting.gov.
Conducted site visits to verify that the security cameras and equipment purchased with the grant
funds had been installed.
We conducted our audit work at the Authority’s administrative office at 7 Van Dyke Avenue, New
Brunswick, NJ, and the HUD Office of Inspector General’s (OIG) office in Newark, NJ, between
October 2012 and February 2013. The audit generally covered the period March 1, 2009, to June 30,
2012. We did not assess the reliability of computer-processed data because we based our conclusions
on source documentation reviewed during the audit.
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 objectives. We believe
that the evidence obtained provides a reasonable basis for our findings and conclusions based on our
audit objectives.
10
INTERNAL CONTROLS
Internal control is a process adopted by those charged with governance and management, designed to
provide reasonable assurance about the achievement of the organization’s mission, goals, and
objectives with regard to
Effectiveness and efficiency of operations,
Reliability of financial reporting, and
Compliance with applicable laws and regulations.
Internal controls comprise the plans, policies, methods, and procedures used to meet the organization’s
mission, goals, and objectives. Internal controls 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 objectives:
Policies and procedures to ensure that the Authority complied with applicable
procurement requirements when awarding Recovery Act contracts.
Policies and procedures over financial controls to ensure that the Authority properly
drew down and expended Recovery Act capital funds for eligible activities.
Policies and procedures to ensure that the Authority properly and accurately
reported its Recovery Act activities to the public.
We assessed the relevant controls identified above.
A deficiency in internal control exists when the design or operation of a control does not
allow management or employees, in the normal course of performing their assigned
functions, the reasonable opportunity to prevent, detect, or correct (1) impairments to
effectiveness or efficiency of operations, (2) misstatements in financial or performance
information, or (3) violations of laws and regulations on a timely basis.
11
Significant Deficiencies
Based on our review, we believe that the following item is a significant deficiency:
Authority officials lacked adequate financial controls to ensure that funds were not
disbursed before board approval and obligation, and that adequate budgetary
controls to track expenditures against budgeted amounts were in place in
accordance with Authority procedures (see finding).
12
APPENDIXES
Appendix A
SCHEDULE OF QUESTIONED COSTS
Recommendation Unsupported 1/
number
1B $107,319
1E $ 157,701
Total $ 265,020
1/ Unsupported costs are those costs charged to a HUD-financed or HUD-insured program or
activity when we cannot determine eligibility at the time of the audit. Unsupported costs
require a decision by HUD program officials. This decision, in addition to obtaining supporting
documentation, might involve a legal interpretation or clarification of departmental policies and
procedures.
13
Appendix B
AUDITEE COMMENTS AND OIG’S EVALUATION
Ref to OIG Evaluation Auditee Comments
City of New Brunswick, New Jersey, Housing Authority
June 13, 2013
VIA ELECTRONIC AND CERTIFIED MAIL
Mr. Edgar Moore, Regional Inspector General for Audit
U.S. Department of Housing and Urban Development
Office of Inspector General, Office of Audit
New York/New Jersey Region 2
26 Federal Plaza
New York, New York 10278
Re: Comments and Response to OIG Audit Report - Recovery Act Capital Fund Program
New Brunswick Housing Authority
Dear Mr. Moore:
In accordance with your department’s request, below please find the New Brunswick Housing
Authority’s (NBHA) written response to the draft audit report of the NBHA’s administration of
the Recovery Act Capital Fund Program. Specifically, as a result of the audit conducted by
XXXXXXXXXX of your office, a draft report was issued on June 4, 2013 containing seven (7)
overall recommendations for improvement and one (1) tentative finding. In response, the NBHA
agrees to provide the HUD field office with all required additional support and documentation
substantiating the questioned costs in the tentative find and to work with the Director of the New
Jersey Office of Public Housing to immediately implement an action plan addressing all of the
proposed recommendations.
Tentative Finding:
The report contained one (1) tentative finding that indicated that: 1)$107,319.00 was expended
in excess of the approved budget from the Board; and 2)$157,701.00 in installation and
maintenance labor costs for the same security camera project were not adequately supported.
Response:
Here, the finding centers upon the NBHA’s procurement of the purchase, installation and
maintenance of a security camera system for the various NBHA properties. This procurement
was vital to both the Housing Authority and its seven (7) member Board of Commissioners in
providing assistance to allow the Authority to provide quality, affordable housing to low-income
families and seniors in the greater New Brunswick area. The primary purpose of this security
system was to protect the assets of the Housing Authority.
14
AUDITEE COMMENTS AND OIG’S EVALUATION
Ref to OIG Evaluation Auditee Comments
The security camera project was one of four (4) projects which utilized a total of $1,285,803.00
received by the NBHA in Recovery Act Capital Funding. In this case, upon the review of
potential security cameras and systems to utilize for the Authority, the Authority found and
discovered that much of the equipment, labor and maintenance for such a system were available
under the federal GSA Cooperative Purchasing Program, which included a series of federally
negotiated and procured prices which were available for the utilization of federal, state and local
entities receiving federal funding. As a result, instead of utilizing a public bid for the totality of
the project, in order to take advantage of the GSA rates, the NBHA moved forward with a two-part
procurement for the system: 1) the public bid of the system server (which was not available on
GSA); and 2) the utilization of the GSA for the purchase, installation and maintenance of the
initial round of security cameras to utilize on the server.
In particular, this decision was based upon the determination by the NBHA's A&E firm that the
cost for the purchase, installation and maintenance of the security cameras, with the capabilities
the NBHA was seeking to obtain, was reasonable in comparison to the purchase of these items
on the open market. In accordance with this, the NBHA Board of Commissioners approved and
authorized both the public procurement of the server as well as the GSA purchase, installation
and maintenance of the security cameras by the same qualified provider. Several months later,
the Board further approved the purchase of a subsequent round of security cameras from the
GSA based upon the identification of additional trouble areas and gaps in the system's coverage.
Tentative Finding (Part 1): The initial part of the finding references $107,319.00 which the
report finds was expended in excess of the approved budget. This finding is based upon the
difference between the total cost of $685,122.00 expended for the security cameras versus the
total amount obligated by the Board of $577,803.00. The report asks for the NBHA to provide
additional support for the Board approval of this excess amount.
Response: The NBHA shall provide the New Jersey HUD office with additional documentation
showing that the NBHA Board of Commissioners was aware of the additional expenditure of
Comment 1 $107,319 at the time expended and will also provide a resolution from the Board ratifying
their acknowledgment of this fact. The NBHA further notes, that as per the report's own
finding, all of the $1,285,803.00 received by the NBHA as Recovery Act Capital Funds were
authorized by the Board for obligation, and were expended accordingly, for one of the four (4)
capital fund projects (including the security cameras). As a result of a surplus left over from two
of the capital fund projects, these funds were re-allocated for the purchase of additional security
cameras needed for the safety and security of the Authority residents.
Tentative Finding (Part 2): The second part off the finding indicates that $157,701.00 was
expended for labor costs which were not adequately supported. This number is based upon the
OIG's review of the invoices and certified payrolls from the contractor. The report asks for the
NBHA to provide additional documentation to adequately support that these costs were
reasonable and actually incurred.
Response: The NBHA shall provide the New Jersey HUD office with additional documentation
showing that the maintenance hours worked and the rates maintained (totaling $157,701.00)
Comment 1 were both reasonable and incurred. Specifically, the additional documentation will show that
all rates were GSA procured rates and that all such costs were fully incurred as part of the
operation and maintenance of the security surveillance system.
15
AUDITEE COMMENTS AND OIG’S EVALUATION
Ref to OIG Evaluation Auditee Comments
Recommendations:
In addition to the above, the report further recommended an additional five recommendations that
includes the strengthening of budgetary, financial and procurement controls, the preparation and
submission of a revised final performance and evaluation report reflecting all actual activities and costs
incurred, and the future reporting of activities undertaken with grant funds in accordance with applicable
reporting requirements.
Response:
The NBHA fully concurs with the OIG recommendations and shall immediately implement efforts to
ensure that such recommendations are incorporated accordingly. Specifically, the NBHA shall undertake
Comment 2 a full review of its procurement, financial and budgetary policies in comparison to the practical
application of such policies within its departments to ensure that appropriate checks and balances are
implemented to ensure full transparency and clear record keeping of the use of all grant funds. A more
detailed action plan shall be provided, along with the revised final performance and evaluation report, to
the New Jersey HUD office.
Finally, on behalf of the NBHA, I want to personally thank XXXXXX and XXXXXXX from your office
for their hard work and professionalism on this review and for their patience with our staff throughout
this process. Thank you.
Sincerely,
//SIGNED//
John Clarke
Executive Director
16
OIG Evaluation of Auditee Comments
Comment 1 Authority officials said that they will provide documentation to demonstrate that the
Board was aware of the additional questioned costs of $107,319 and to support the
unsupported labor costs of $157,701. Any documentation provided will be assessed for
its adequacy during the audit resolution process with HUD.
Comment 2 Authority officials concurred with the recommendations and have promised action
responsive to the recommendations.
17
Authority Officials Generally Administered Recovery Act Funds in Accordance With Requirements but Budgetary and Procurement Controls Had Weaknesses
Published by the Department of Housing and Urban Development, Office of Inspector General on 2013-06-21.
Below is a raw (and likely hideous) rendition of the original report. (PDF)