oversight

Miami-Dade County Did Not Always Properly Administer Its HOME Program

Published by the Department of Housing and Urban Development, Office of Inspector General on 2014-09-11.

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

OFFICE OF AUDIT
REGION 4
ATLANTA, GA




                  Miami-Dade County, Miami, FL


          HOME Investment Partnerships Program




2014-AT-1010                                 SEPTEMBER 11, 2014
                                                        Issue Date: September 11, 2014

                                                        Audit Report Number: 2014-AT-1010



TO:            Ann D. Chavis, Director of Community Planning and Development, Miami Field
               Office, 4DD

               //signed//
FROM:          Nikita N. Irons, Regional Inspector General for Audit, Atlanta Region, 4AGA

SUBJECT:       Miami-Dade County Did Not Always Properly Administer Its HOME Program


       Attached is the U.S. Department of Housing and Urban Development (HUD), Office of
Inspector General’s (OIG) final results of our review of Miami-Dade County’s administration of
the HOME Investment Partnerships Program authorized under the National Affordable Housing
Act.
        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 8M, 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 404-331-3369.
                                        September 11, 2014
                                        Miami-Dade County Did Not Always Properly
                                        Administer Its HOME Program




Highlights
Audit Report 2014-AT-1010


 What We Audited and Why                       What We Found

We audited Miami-Dade County’s HOME           The County did not always comply with HOME
Investment Partnerships Program. The          requirements. Specifically, it did not properly
County was selected for review because (1)    (1) commit HOME funds for 25 activities, (2)
our audit plan included audits of HOME        support that a beneficiary was income eligible for
grantees; (2) the Miami U.S. Department of    one activity, and (3) manage its HOME
Housing and Urban Development (HUD),          agreements. These conditions occurred because
Office of Community Planning and              the County did not have effective written policies
Development, ranked the County as high        and procedures to ensure the proper
risk in its 2012 and 2013 risk assessments;   administration of HOME funds. As a result,
and (3) HUD’s Office of Inspector General     more than $1.4 million in HOME funds was not
(OIG) had not performed an audit of the       properly committed, and $250,000 in committed
County’s HOME program. Our objective          HOME funds was not supported.
was to determine whether the County (1)
ensured that expenditures of HOME funds
were supported and allowable and (2)
properly supported commitments of HOME
funds in HUD’s Integrated Disbursement
and Information System.

 What We Recommend

We recommend that HUD (1) recalculate
the commitment requirement as a result of
the County’s having more than $1.4 million
in invalid commitments, (2) require the
County to implement policies and
procedures to ensure compliance with
HOME requirements, and (3) require the
County to support homeowner rehabilitation
activity 5134 or reimburse its program
$45,600 from non-Federal funds and put
$204,400 in HOME funds to better use.
                            TABLE OF CONTENTS

Background and Objective                                                 3

Results of Audit
      Finding: The County Did Not Always Comply With HOME Requirements   4

Scope and Methodology                                                    10

Internal Controls                                                        12

Appendixes
A.    Schedule of Questioned Costs and Funds To Be Put to Better Use     13
B.    Auditee Comments and OIG’s Evaluation                              14
C.    Project 61 – Invalid Home Buyer Assistance Commitments             20




                                            2
                     BACKGROUND AND OBJECTIVES

The HOME Investment Partnerships Program is authorized under Title II of the Cranston-
Gonzalez National Affordable Housing Act. The U.S. Department of Housing and Urban
Development (HUD) allocates funds by formula to eligible State and local governments for the
purpose of increasing home ownership and affordable housing opportunities for low- and very
low-income families. State and local governments that become participating jurisdictions may
use HOME funds to carry out housing strategies through acquisition, rehabilitation, new housing
construction, and tenant-based rental assistance.

Miami-Dade County receives annual allocations of HOME funds from HUD. In fiscal years 2011
through 2013, HUD allocated more than $13 million in HOME funds to the County. The County
is a chartered political subdivision of the State of Florida and is authorized with the power of
self-government by the Constitution of the State of Florida and Florida statutes. The Board of
County Commissioners is the legislative and governing body of the County.

On October 1, 2011, the operations of the Department of Housing and Community Development
merged with the Miami-Dade Public Housing Agency to form the Miami-Dade Public Housing
and Community Development Department. This department maintains responsibility for several
programs, including the public housing, Section 8, Community Development Block Grant, State
Housing Initiatives Program, Documentary Stamp Surtax, and several other programs. The
department manages and operates more than 9,200 public housing units and approximately
16,000 Section 8 units.

The County’s Public Housing and Community Development Department is committed to
providing low- and moderate-income residents of the County with high-quality and affordable
housing. It administers these programs primarily through subgrantee, community-based
organizations, developers, and other entities.

The County commits and draws HOME funds through HUD’s Integrated Disbursement and
Information System (IDIS). This system allows grantees to request their grant funding from
HUD and report on what is accomplished with these funds. According to IDIS, from October 1,
2011, through December 31, 2013, the County committed more than $6.6 million in HOME
funds and drew down more than $19.4 million in HOME funds.

The audit objective was to determine whether the County administered its HOME program in
accordance with applicable HUD requirements. Specifically, we wanted to determine whether
the County (1) ensured that expenditures of HOME funds were supported and allowable and (2)
properly supported commitments of HOME funds in IDIS.




                                               3
                                RESULTS OF AUDIT

Finding: The County Did Not Always Comply With HOME
Requirements
The County did not always comply with HOME requirements. Specifically, it did not properly
(1) commit HOME funds for 25 activities, (2) support that the beneficiary was income eligible
for one activity, and (3) manage its HOME agreements. These conditions occurred because the
County did not have effective written policies and procedures to ensure the proper administration
of HOME funds. As a result, more than $1.4 million in HOME funds was not properly
committed, and $250,000 in committed HOME funds was not supported.


 The County Improperly
 Committed 24 Activities


              The County did not sign or date the home buyer assistance loan agreements to
              purchase a home for its Miami-Dade Office of Community and Economic
              Development Scattered Sites Homebuyer Financing project (project 61).
              According to 24 CFR (Code of Federal Regulations) 92.2, a commitment occurs
              when the participating jurisdiction has executed a legally binding agreement with
              the recipient to use a specific amount of HOME funds. This project had 24
              activities with commitments of $978,250. We reviewed 11 of these activities with
              commitments of $634,250. The home buyer financing agreements reviewed for
              these activities were not dated and signed by the County. See appendix C for a
              listing of the activities reviewed.
              The Office of Community Planning and Development’s (CPD) Notice CPD 07-
              06, Section VII-B, states that a written agreement between the grantee and the
              recipient must be signed by both parties. The signatures of all parties signing the
              agreement must be dated to show the execution date. The County explained that
              it was not a part of its process to sign the home buyer assistance agreements. The
              home buyer signed the agreement at closing, which the County did not attend. In
              addition, the County said that it did not require the signature of a County
              representative because the County and home buyer had previously signed a
              commitment letter. The commitment letter was the County’s intent to assist the
              home buyer contingent upon certain conditions being met. The County explained
              that this letter triggered the County to open and commit funds in IDIS. However,
              according to CPD Notice 07-06, Section VII, the letter was not sufficient to
              support commitments.
              Based on conversations with County staff and the review of its files, the County
              used the same documents to support the commitments for the entire project.
                                                4
                  Therefore, for this project, the County improperly committed 24 activities totaling
                  $978,250 in HOME funds by not having legally binding written agreements that
                  were signed and dated by the County.

    The County Did Not Commit
    HOME Funds for One Activity
    in a Timely Manner

                  The County committed HOME funds in IDIS before it had a legally binding
                  written agreement. On April 18, 2012, the County executed a written agreement
                  totaling $500,000 for activity 5109 to rehabilitate 12 rental units. However, the
                  County committed funds in IDIS on March 19, 2012, before it had a legally
                  binding written agreement. According to HOME FACTS 1, Volume 3, No.2, only
                  after the grantee has executed a legally binding agreement can it enter the
                  commitment into IDIS. Any activity funded in IDIS without an executed legally
                  binding written agreement already in place is not a valid commitment. The
                  County stated that this activity had not started because the developer was having
                  financing problems. The County was underwriting this activity during our
                  review. In addition, the agreement for this activity expired on September 30,
                  2013, and was not extended until June 2014 (as discussed below in The County
                  Did Not Effectively Manage Its HOME Agreements section (amended
                  agreements)).
                  The County explained that this condition may have occurred because funds were
                  committed after the Board of County Commissioners approved the funding.
                  However, CPD Notice 07-06 indicates that approved budgets, including
                  governing body budget resolutions, are not acceptable commitment
                  documentation.
                  These conditions occurred because the County did not have policies and
                  procedures in place to ensure that funds were committed in IDIS in a timely
                  manner. As a result, the County had invalid commitments of $500,000 in HOME
                  funds.

    The County Did Not Support
    the Income Eligibility for One
    Activity

                  The County did not provide documentation to support the eligibility of a
                  beneficiary for activity 5134. This activity involved the rehabilitation of the

1
 HOME FACTS is HUD’s newsletter for the HOME Program that addresses topics such as HOME grants, deadline compliance,
and repayments, and HOME computer systems processed in IDIS.

                                                         5
           beneficiary’s property. According to 24 CFR 92.508(a)(3)(v), the grantee must
           maintain records demonstrating that each family is income eligible in accordance
           with section 92.203.

           The County explained that it had qualified the beneficiary as income eligible;
           however, it was unable to locate the supporting documentation due to the change
           in administration. Given the period that had elapsed since it initially opened the
           activity in IDIS in June 2012, the County should have recertified the beneficiary.
           The County staff said it did not recertify the beneficiary. Regulations at 24 CFR
           92.203(d) (2) require that the grantee reexamine the family’s income if more than
           6 months has elapsed since the grantee determined that the family qualified as
           income eligible. The County did not provide documentation supporting the
           eligibility of the beneficiary that was allocated $250,000 in HOME funds. The
           County explained that construction had not started due to difficulties with the
           architect, but as of April 2014, it had found a new architect to resume this activity.
           Due to the delay of this project, the County is required to prepare an updated
           schedule of completions in accordance with 24 CFR 92.504(c)(2)(i). As of June
           2014, the County drew down $45,600 of the total funds committed for this
           activity without documentation supporting the eligibility of the beneficiary.
           Therefore, the $45,600 expended is unsupported, and the remaining balance of
           $204,400 should be reprogrammed and made available for other eligible HOME
           activities.

The County Did Not Effectively
Manage Its HOME Agreements

           The County did not effectively manage its HOME agreements with its awardees.

           Agreement provisions – The HOME agreements did not clearly identify the role
           of the awardee. Specifically, they did not indicate whether the awardee was a
           subrecipient, developer, or other entity. Regulations at 24 CFR 92.504(c)
           establish the minimum provisions required in a written agreement depending on
           the role of the entity. The County explained that it used a standard template with
           HOME provisions applicable to all type of awardees. To ensure proper
           administration of the funds, the County must clearly define the applicable
           provisions depending on the type of awardee. The County agreed and was
           preparing an agreement template for each type of awardee.

           The HOME agreements template also incorrectly referred to the Community
           Development Block Grant provisions. Therefore, the County should ensure that
           the applicable provisions required by 24 CFR 92.504 are incorporated into the
           grant agreements. The County agreed and indicated that it was updating its
           HOME agreement templates.


                                             6
Undated signatures in agreements – The County did not require dated signatures
on its HOME agreements as required by HUD’s CPD Notice 07-06, Section VII.
Without the dates, we were unable to determine when the agreements were
executed. The County explained that the body of the agreement indicated the
effective date. However, to ensure transparency and accountability, the County
should require the parties to date their signatures, rather than relying on the date
stated in the agreements. The County agreed, and in June 2014, it included a date
line for signatures in one of its HOME agreement templates. The County was
updating its remaining HOME agreement templates to include a date line for
signatures.

Amended agreements – The County did not renew or execute a new agreement in
a timely manner. It amended agreements several months after the agreement had
expired. For instance, there were agreements that were amended 137 to 248 days
after the expiration date.

            IDIS         Expiration date of     Date of       Days
           activity      initial agreement    amendment      elapsed
            5109              09/30/13         06/05/14        248
            5103              09/30/13         04/04/14        186
            5134              12/31/12         07/01/13        182
            5057              12/31/11         05/16/12        137

The County had two expired agreements for construction activities 4909 and 4928
that needed an extension. For activity 4909, the County planned to extend the
agreement, which expired on December 31, 2013. This activity experienced
interruptions due to insufficient funding. Recently, the awardee requested
additional HOME funding to complete construction. As a result, in July 2014, the
County planned to submit the request for extension and funding to the Board of
County Commissioners. The County must be vigilant of the progress of this
activity and should prepare an updated schedule of completion as required at 24
CFR 92.504(c)(3)(i).

For activity 4928, the agreement expired on June 30, 2014. The County explained
that it was extending this agreement to allow the awardee time to obtain the
certificate of occupancy.

The County explained that it tried to amend agreements before the expiration
date; however, due to heavy workloads, amendments were not processed in a
timely manner. In addition, the County stated that it relied on the awardee to
inform it when an extension was needed. Failure to inform the County in a timely
manner delayed the amendment process. According to 24 CFR 92.504, the
participating jurisdiction is responsible for managing the day-to-day operations of
its HOME program and ensuring that HOME funds are used in accordance with
all program requirements and written agreements.

                                  7
Conclusion

             The County did not always comply with HOME requirements. Specifically, it did
             not properly (1) commit HOME funds for 25 activities, (2) support that a
             beneficiary was income eligible for one activity, and (3) manage its HOME
             agreements. These conditions occurred because the County did not have effective
             written policies and procedures to ensure the proper administration of HOME
             funds. As a result, the County did not properly commit more than $1.4 million in
             HOME funds in IDIS and support $250,000 in HOME funds. The incorrect
             information reported in IDIS undermined the integrity of HUD’s information
             system and HUD’s efforts to monitor the County’s compliance with HOME
             program requirements.

Recommendations

             We recommend that the Director of the HUD Miami Office of Community Planning
             and Development require the County to
             1A.    Establish and implement policies and procedures to ensure that
                    commitments are entered into IDIS after the County has a valid written
                    agreement that has been signed and dated by all parties.

             1B.    Provide supporting documentation for activity 5134 or reimburse its program
                    $45,600 from non-Federal funds and put to better use $204,400 in HOME
                    funds.
             1C.    Prepare a schedule of completion for activities 5134 and 4909 as required by
                    24 CFR 92.504(c).

             1D.    Provide the revised HOME agreement templates for the various types of
                    awardees, which must include the HOME provisions and date line for
                    signatures. The home buyer assistance agreements template should also
                    include a signature and date line for the County.
             1E.    Establish and implement policies and procedures to ensure that amendments
                    are executed on a timely basis.
             1F.    Provide the amended or renewed agreements for activities 4909 and 4928.




                                              8
                We recommend that the Director of the HUD’s Miami Office of Community
                Planning and Development
                1G.      Recalculate the commitment requirement as a result of the County’s
                         improperly committing $1,478,250 2 in HOME funds for project 61 and
                         activity 5109 and determine the cumulative effect on the County’s
                         commitment requirement.




2
 The County improperly committed $1,478, 250, composed of activity 5109 and project 61 with commitments of
$500,000 and $978,250, respectively.

                                                     9
                         SCOPE AND METHODOLOGY

We performed our review from February through June 2014 at the County’s Public Housing and
Community Development Department located at 701 Northwest 1 st Court, Floor 14, Miami, FL,
and other sites as necessary. Our review covered the period October 1, 2011, through December
31, 2013, and was expanded as needed to achieve our objective.

To accomplish our objective, we

   •   Reviewed applicable laws and regulations;

   •   Reviewed applicable County policies and procedures;

   •   Reviewed monitoring, independent public accountant, and IDIS reports;

   •   Reviewed the County’s financial records, program activity files, and other supporting
       documentation;

   •   Interviewed HUD and County staff; and

   •   Performed site visits to ensure the existence of activities.

During the period October 1, 2011, through December 31, 2013, the County committed more
than $6.6 million in HOME funds for 78 activities. We selected and reviewed 20 activities that
had commitments of more than $3.9 million based on high dollar amounts or lowest percentage
of funds drawn. This selection represented 60 percent of the total commitments during our scope
period. This review resulted in invalid commitments for activities 5109, 5061, and 5129.

Activities 5061 and 5129 had commitment of $149,000. These activities were part of project 61,
with total commitments of $978,250. To confirm whether this issue applied to the remaining 22
activities, we examined nine additional activities from project 61 with commitments of $485,250
for a total of $634,250, or 65 percent of the total commitments. The County also did not
adequately commit these funds resulting in invalid commitments of all 24 activities for this
project.

The County had more than $19.4 million in drawdowns for 603 completed transactions during
our scope period. Based on high dollar amount, we selected six transactions with expenditures
of more than $5.3 million to review for cost allowability. These transactions represented 28
percent of funds drawn. The County demonstrated that more than $5.3 million in HOME funds
was allowable and supported.

As of January 27, 2014, the County had 13 activities that were not completed within 4 years of
the initial funding date. We selected 6 of the 13 activities based on high dollar amount and as
suggested by HUD. These activities were funded as early as 1993. Initially, we identified
                                                 10
potential questioned costs of more than $2.6 million for five activities because the County did
not have documentation to support the HOME-assisted units as reflected in IDIS. HUD’s CPD
headquarters office also reviewed these activities, and on May 29, 2014, it required repayment
for these activities. Therefore, the deficiencies found for these activities were not included in
this audit report.
We did not perform a 100 percent selection. The results of this audit apply only to the items
reviewed and cannot be projected to the universe of activities.

We determined that computer-processed data generated by the County were not used to
materially support our audit findings, conclusions, and recommendations. Thus, we did not
assess the reliability of its computer-processed data.

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(s). We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objective.




                                                11
                              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
               objective:

               •      Controls over program operations.
               •      Controls over relevance and reliable information.
               •      Controls over compliance with laws and regulations.
               •      Controls over the safeguarding of assets and resources.

               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.

 Significant Deficiency

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

               •   The County did not always comply with HOME requirements because it did not
                   have effective written policies and procedures to ensure the proper
                   administration of HOME funds.

                                                 12
                                   APPENDIXES

Appendix A

              SCHEDULE OF QUESTIONED COSTS
             AND FUNDS TO BE PUT TO BETTER USE


               Recommendation                               Funds to be put to
                       number         Unsupported 1/             better use 2/
                    1B                   $45,600              $ 204,400
                    1G                  _______                1,478,250
                   Total                 $45,600              $1,682,650


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.

2/   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 recommendation 1B is implemented,
     funds will be available for other eligible activities consistent with HOME requirements.
     If recommendation 1G is implemented, HUD may reduce grant funds based on the
     cumulative effect of the deficiency.




                                             13
Appendix B

        AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




Comment 1




Comment 2



Comment 3




                          14
Comment 4




Comment 2




Comment 3



Comment 5




Comment 4




            15
Comment 6




Comment 7



Comment 8




            16
                              Evaluation of Auditee Comments

Comment 1     The County said that the 24 activities are associated with its Homeownership
              program. According to the County, it had fully executed commitment letters for
              all of the homes that were purchased. Furthermore, the files were closed with the
              appropriate restrictions recorded and funds expended prior to the commitment
              deadline.
              The report recognizes that the activity files had the commitment letters.
              However, these letters are letters of intent to assist the home buyer contingent
              upon certain conditions being met. CPD Notice 07-06, section VII
              Documentation, states that signed letters of intent are unacceptable for use as
              commitment documentation. Therefore, the County’s commitment letters are not
              valid documents that would allow funds to be committed in HUD’s IDIS system.
              Although, the County claims that the files were closed with the appropriate
              restrictions, this is not a basis to support that funds were properly committed. As
              a result, the County did not enter into valid written agreements to support its
              commitment of $978,250 for project 61.

Comment 2     The County stated that it executed the agreement for activity 5109 prior to its
              expenditure deadline of April 30, 2012.
              Our review for this activity did not include assessing whether the County
              complied with expenditures requirements. Our objective was to determine
              whether the County entered into a legally binding written agreement before any
              funds were committed and entered into IDIS. The County did have a written
              agreement executed on April 18, 2012. However, the County committed HOME
              funds in IDIS on March 19, 2012, before it had a legally binding written
              agreement. According to HOME FACTS, Volume 3, No.2, only after the grantee
              has executed a legally binding agreement can it enter the commitment into IDIS.
              Any activity funded in IDIS without an executed legally binding written
              agreement already in place is not a valid commitment. As a result, the County
              had invalid commitments of $500,000 in HOME funds.

              In addition, the County agreed that its policies and procedures did not require that
              it attach the fully executed contract to the activity set-up form before funds were
              committed in IDIS. It provided documentation to address recommendation 1A
              showing that the set-up forms had been revised to include the requirement. We
              acknowledge the County’s requirement that the set-up forms are supported by a
              fully executed contract to ensure that activities are properly set-up and committed
              in IDIS. Recommendation 1A will be resolved with HUD when the County
              provides documentation showing that the staff has followed these procedures.

Comment 3 The County said that it has documented that the homeowner (1) is still income
          eligible and (2) was income eligible at the time of the expenditure.

                                               17
            The documentation provided by the County was incomplete and could not be used
            to determine whether the household was income eligible as required by 24 CFR
            92.203. For example, the County did not include the methodology used and its
            calculation of the homeowner’s annual income for previous and current periods.

            (1) To support current eligibility, the County failed to explain how it projected
            annual income when the paystubs showed variations in hours worked. The
            County also did not identify the size of the household and whether there were
            other assets and sources of income.

            (2) To support prior income eligibility at the time of expenditure, the County
            provided uncertified copies of tax returns. If the County used tax returns as the
            sole source documentation for a household income, IRS 1040 tax form should
            have been certified, as required by the Technical Guide for Determining Income
            and Allowances for the HOME Program. Otherwise, the County should have
            obtained other source documentation to confirm income. In addition, it failed to
            clarify the household size and whether other household members generated
            income that should be considered in the annual income projection.

            Since the County did not provide complete information to determine the
            household’s income eligibility, the $250,000 committed for activity 5134 remains
            unsupported. During the audit resolution process, the County can provide HUD
            with the additional documentation.

Comment 4   The County provided a copy of the agreement templates for the developer and
            sub-recipient. These templates now include the date line under the County's
            signature block for the contracts and it does not make references to the
            Community Development Block Grant program. The County indicated that it
            uses HUD reports to manage timeliness of expenditures, completion and close-
            outs. To further assist in managing its contracts, the County is working to
            maximize the capability of its data system, which will provide a series of status
            reports.

            We acknowledge the County’s proactive approach to establish a system to
            effectively manage its HOME agreements. The County incorporated a date line
            under the County’s signature block and removed references to the Community
            Development Block Grant program from its developer and subrecipient
            agreement templates. However, it did not provide an updated template of its
            home buyer assistance agreement that includes a signature and date line for the
            County. As stated in recommendation 1D, the County should review its templates
            to ensure that the applicable provisions required by 24 CFR 92.504 are
            incorporated into the grant agreements. For example, the sub-recipient template
            included provisions applicable to community housing development organizations



                                             18
                   (CHDO) 3. However, according to 24 CFR 92.2, a public agency or nonprofit
                   organization that receives HOME funds solely as a developer or owner of housing
                   is not a sub recipient. During the audit resolution process, the County can work
                   with HUD to complete its revised agreement templates.
Comment 5          In its response, the County included a schedule of completion for activity 4909
                   (JPM). It is in the process of obtaining supporting documentation for activity
                   5134, (MacFarlane Historic).
                   The County provided a schedule of completion for activity 4909. Based on this
                   schedule, it will be completed in October 2014. During the audit resolution
                   process, the County will provide HUD with a schedule of completion for activity
                   5134. Due to the delays of these activities, the County should keep HUD aware
                   of the progress to ensure that it meets required deadlines.
Comment 6          The County explained that its information technology staff will modify its
                   internal Project Activity Tracking System to include functions that would
                   generate a Contract Expiration report 3 months prior to the expiration date.

                   We acknowledge the County’s effort to establish a system that ensures
                   amendments are executed on a timely basis. During the audit resolution process,
                   the County can provide HUD with its applicable policies and procedures.

Comment 7 The County stated that the contract amendments for IDIS activities #4909(JPM)
          and #4928, (Magnolia North Apt) will be executed by the August 31, 2014 and
          forwarded to HUD.

Comment 8          The County asked HUD to recalculate the commitment requirement as a result
                   of the County improperly committing $1,478,250 in HOME funds for project
                   61 and activity 5109 to determine the cumulative effect on the County's
                   commitment requirement.

                   We agree with recommendation 1G that the Director of the HUD’s Miami Office
                   of Community Planning and Development recalculate the commitment
                   requirement to determine the cumulative effect on the County improperly
                   committing more than $1.4 million in HOME funds.




3
  According to 24 CFR 92.2, a CHDO is a nonprofit organization that has the capacity to carry out affordable housing for the
community it serves. The HOME funds may be used for projects that are owned, developed, or sponsored by a CHDO.



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Appendix C
PROJECT 61 – INVALID HOME BUYER ASSISTANCE COMMITMENTS


                          IDIS        Initial funding   Committed
              #
                         activity           date         amount

              1            5129            05/09/12         $72,000
              2            5061            02/02/12         $77,000
              3            5127            05/09/12         $66,000
              4            5112            03/28/12         $63,500
              5            4704            10/08/08         $63,000
              6            4661            07/28/08         $60,000
              7            4682            09/25/08         $50,000
              8            5128            05/09/12         $49,750
              9            4710            11/17/08         $48,000
             10            5130            05/09/12         $43,000
             11            4705            10/08/08         $42,000
                  Subtotal - activities reviewed           $634,250
             12            4748            06/26/09         $37,000
             13            4709            11/17/08         $37,000
             14            4658            07/24/08         $35,000
             15            4655            07/18/08         $33,000
             16            4684            09/25/08         $28,000
             17            4660            07/24/08         $28,000
             18            4659            07/24/08         $28,000
             19            4745            04/27/09         $27,000
             20            4665            09/29/08         $25,000
             21            4749            06/26/09         $20,000
             22            4848            03/03/10         $16,000
             23            4683            09/25/08         $16,000
             24            4681            09/25/08         $14,000
                     Remaining activities                  $344,000
                              Total                        $978,250




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