OFFICE OF AUDIT
REGION 1
895
BOSTON, MA
The Housing Authority of the
City of Bridgeport, CT
Public Housing and Housing Choice Voucher
Program Expenditures
2014-BO-1001 JANUARY 23, 2014
Issue Date: January 23, 2014
Audit Report Number: 2014-BO-1001
TO: Jennifer Gottlieb Elazhari
Program Center Coordinator, Office of Public and Indian Housing, Hartford Field
Office, 1EPHP
//SIGNED//
FROM: Edgar Moore,
Regional Inspector General for Audit, Boston Region, 1AGA
SUBJECT: The Housing Authority of the City of Bridgeport, CT, Did Not Always Ensure
That Expenses Charged to Its Federal Programs Were Eligible, Reasonable, and
Supported
Attached is the U.S. Department of Housing and Urban Development (HUD), Office of
Inspector General’s (OIG) final results of our review of the City of Bridgeport Housing
Authority, Bridgeport, CT.
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
212-264-4174.
January 23, 2014
The Housing Authority of the City of Bridgeport, CT,
Did Not Always Ensure That Expenses Charged to Its
Federal Programs Were Eligible, Reasonable, and
Supported
Highlights
Audit Report 2014-BO-1001
What We Audited and Why What We Found
We audited the Housing Authority of Authority officials did not always ensure that expenses
the City of Bridgeport, CT, based on a charged to the Authority’s Federal programs were
request from the U.S. Department of eligible, reasonable, and supported. Specifically, they
Housing and Urban Development did not (1) properly charge and support all costs
(HUD), Hartford, CT, field office. allocated to Federal housing programs, (2) adequately
HUD officials were concerned about the manage maintenance costs, and (3) ensure that
Authority due to significant financial employee health care and liability insurance policies
deficiencies that were not corrected in a were obtained at the most cost-effective price. These
timely manner. Our audit objective was deficiencies occurred because Authority officials
to determine whether Authority officials improperly implemented asset management procedures
ensured that expenses charged to and did not provide formal accounting procedures and
Federal programs were eligible, supervision. As a result, ineligible costs of more than
reasonable, and supported. $895,000 were incurred, and more than $790,000 in
charges was unsupported. These improper charges
weakened the projects’ financial position and left
What We Recommend
fewer funds for operations. Also, with diminishing
budgets and staffing levels, diverting staff from
We recommend that the Director of
Federal to non-Federal properties could result in
HUD’s Hartford Office of Public and
degraded maintenance at the Federal properties.
Indian Housing require Authority
officials to (1) repay more than
$895,000 in ineligible costs and support
or repay more than $790,000 in costs
charged to the Authority’s Federal
programs, (2) measure and monitor the
maintenance staff’s productivity and
rotate work schedules to avoid
unnecessary overtime costs, (3) develop
procedures to competitively obtain
insurance, and (4) train staff on asset
management rules.
TABLE OF CONTENTS
Background and Objective 3
Results of Audit
Finding 1: The Authority Did Not Always Properly Charge and
Support Costs Allocated to Its Federal Programs 4
Finding 2: Maintenance Costs Were Not Adequately Managed 12
Finding 3: Procurement Procedures Did Not Ensure That Health Care and
Liability Insurance Was Obtained at the Most Cost-Effective Price 14
Scope and Methodology 16
Internal Controls 19
Appendixes
A. Schedule of Questioned Costs and Funds To Be Put to Better Use 21
B. Auditee Comments and OIG’s Evaluation 22
C. OIG Estimate of Workers Compensation Insurance Overcharges and
Undercharges 32
2
BACKGROUND AND OBJECTIVE
The Housing Authority of the City of Bridgeport, CT, was created under section 8-40 of the
Connecticut General Statutes to provide low-income public housing for qualified individuals.
The Authority has contracted with the Federal Government, acting through the U.S. Department
of Housing and Urban Development (HUD), for financial assistance for low-income housing
under the United States Housing Act of 1937 as amended. The Authority is governed by a five-
member board of commissioners, which appoints an executive director to manage the day-to-day
operations of the Authority. The Authority administered more than 2,800 Section 8 housing
choice vouchers and more than 2,500 public housing low-rent units. It received approximately
$30 million in Federal Section 8 Housing Choice Voucher program funds and $18 million in
public housing funds in fiscal year 2012.
The Authority also manages Baldwin Holdings, Incorporated, a non-Federal tax-exempt
organization created for the development of housing units that benefit low-income residents of
Bridgeport. The board members of Baldwin are employees or commissioners of the Authority.
The Authority’s employees provided the following services for Baldwin: (1) administrative
services, (2) maintenance services, (3) accounting services, and (4) insurance for Baldwin units.
Our audit objective was to determine whether Authority officials ensured that expenses charged
to Federal housing programs were eligible, reasonable, and supported. Specifically, we reviewed
Maintenance labor costs;
Property management, book-keeping, and asset management fees;
Auditing, consulting, and fee accountant services;
Legal fees; and
Insurance costs.
We also wanted to determine whether Authority officials complied with asset management rules
when they transferred funds from Federal asset management projects to other asset management
projects in fiscal year 2012.
3
RESULTS OF AUDIT
Finding 1: The Authority Did Not Always Properly Charge and Support
Costs Allocated to Its Federal Programs
Authority officials did not always properly charge and support costs allocated to the Authority’s
Federal housing programs. Specifically, they improperly charged the Federal programs for
central maintenance employees, management and book-keeping fees, insurance, non-Federal
maintenance work, auditing and consulting fees, and legal costs. In addition, officials transferred
cash between asset management projects that were not eligible for the transfers. These
conditions occurred because Authority officials inappropriately implemented asset management
procedures and did not provide formal accounting procedures and supervision. As a result, the
Federal programs were overcharged by more than $895,000, and officials could not support more
than $790,000 charged to Federal programs. These improper charges weakened the projects’
financial position and left fewer funds for operations.
Federal Programs Were
Overcharged
Authority officials overcharged Federal housing programs $895,852 as follows:
Overcharges Amount
Central maintenance employees $240,321
Management and book-keeping fees 281,611
Non-Federal maintenance 88,290
Public officials’1 and property liability insurance 26,434
Auditing and consulting costs 30,000
Contract legal costs 4,196
Transfers 225,000
Total $895,852
Central Maintenance Costs Charged to Federal Programs
Authority officials charged the Authority’s asset management projects for three
central maintenance employees: a central maintenance coordinator, a central
work order clerk, and a sweeper operator-maintenance aide.2 Under asset
management rules,3 these central maintenance costs must be charged to the central
office cost center. As a result of the improper charges, $240,321 in ineligible
salary and benefit costs was charged to Federal programs.
1
Public officials’ liability insurance provides liability coverage for the errors and omissions of public officials.
2
Charged between January 2012 and May 2013
3
24 CFR (Code of Federal Regulations) 990.280(d)
4
When we informed Authority officials that these costs could not be allocated and
charged to the asset management projects, they stated that they planned to
eliminate these positions.
Additionally, Authority officials did not properly charge the salary and benefit
costs of a heating, ventilation, and air conditioning technician when they allocated
approximately $187,550 of this employee’s costs across all of the asset
management projects based on the number of boilers at each project. Asset
management rules require that central maintenance services such as these be
charged on a reasonable fee-for-service basis to ensure that the asset management
projects pay only for the services they receive.4
Asset Management, Property Management, and Book-Keeping Fee
Overcharges
The Federal projects were overcharged $281,611 in asset management, property
management, and book-keeping fees between October 2009 and April 2013.
Specifically, $158,880 in asset management fees was overcharged in fiscal year
2010. Before our audit, the chief financial officer also identified the overcharges,
which were made before he was employed at the Authority. However, journal
entries to correct the overcharges and reimburse the asset management projects
had not been made. In addition, property management and book-keeping fees of
$108,193 and $14,538, respectively, were overcharged when Authority officials
overstated the number of housing units used to calculate the fees. HUD requires
that only occupied and HUD-approved vacant units be included in fee
calculations; however, Authority officials included vacant units that did not have
the required HUD approval.
Non-Federal Maintenance
Federal funds may be used only to operate, maintain, and manage public housing
properties.5 However, federally paid scattered sites workers’ activities included
maintaining and managing the Authority’s non-Federal Baldwin Holdings
properties.6 We attributed this noncompliance to the improper implementation of
asset management procedures. Although the officials tried to track and charge
Baldwin for the work, the hours charged were not always accurate. At least 197
hours of maintenance were not charged during 2011, and work for grounds
4
We noted that this employee also performed some work on non-Federal properties; however, because the majority
of the work was at the Federal properties, we did not take a cost exception for the $187,550. In addition, Authority
officials agreed that going forward, they would charge the properties on a fee-for-service basis in accordance with
asset management rules.
5
The Housing Act of 1937, Section 9,
http://portal.hud.gov/hudportal/HUD?src=/program_offices/public_indian_housing/programs/ph/am/eligibility
6
There are approximately 66 Baldwin Holdings, Incorporated, units.
5
maintenance and snow removal was not tracked or billed.7 In addition, officials
did not bill for the equipment or gas used. As a result, the $19,010 billed to
Baldwin for maintenance was materially understated. The scattered sites’ staff
also provided administrative services for Baldwin, and officials billed $69,280 for
these services. However, the accounting records provided did not show that the
scattered sites were paid for these services.8 Due to the condition of the
Authority’s books and records, we could not readily determine the total amount
requiring repayment. Therefore, we estimated that at least $88,290 required
repayment.
Insurance Overcharges
Authority officials overcharged Federal programs $26,434 for insurance. They
improperly allocated $11,172 for public officials’ liability insurance to the
Authority’s Federal programs in 2012. The Authority’s allocation plan was based
on the number of housing units and resulted in no charges to the central operating
cost center and Section 8 program. However, since the central operating cost
center and Section 8 program had approximately 54 of the Authority’s 144
employees, they benefited from the insurance and should have paid a portion of
its costs. During the audit, finance officials agreed to allocate the costs based on
the number of covered employees starting in fiscal year 2013.
In addition, Authority officials overcharged the Authority’s asset management
projects $15,262 for general property liability insurance because recently acquired
non-Federal housing units were not included in its allocation plan.9
Auditing and Consulting Fees Improperly Charged
A majority of the $641,000 in accounting and auditing charges reviewed were for
necessary, reasonable, and supported project costs. However, $30,000 was not
eligible. Specifically, Authority officials charged Federal programs $20,000 for
organizational consulting services provided by the Authority’s auditor that
benefited the central operating cost center’s human resources, procurement,
finance, and information departments. However, this was not an eligible expense
because the services provided had already been paid for as part of the
management fees the asset management projects paid to the central operating cost
center.
Authority officials also used $10,000 in Federal operating funds for additional
services related to the Authority’s 2009 independent audit. The additional audit
7
The work orders did not include travel time and supervisory costs for the foreman, which also resulted in
undercharges to Baldwin.
8
Employees from other Federal projects also performed work for Baldwin at times, but scattered sites employees
were generally the employees who performed the work.
9
Officials overcharged the asset management projects for property liability insurance $7,965 in fiscal year 2012
and $7,297 in fiscal year 2013 for a total of $15,262.
6
work was required to cover tasks related to the absence of a chief financial officer
and newly acquired component units. However, these costs should have been
charged to the central operating cost center because the asset management
projects paid for a chief financial officer as part of the fees they paid to the central
operating cost center and the component units were non-Federal units, the costs of
which should be charged to the central operating cost center.
In addition, Authority officials did not allocate any of the Authority’s annual audit
costs to the central operating cost center, its non-Federal component units, or the
Section 8 program, all of which were audited. Thus, the asset management
projects paid more than their fair share of these costs.
Legal Costs Mistakenly Charged
Authority officials charged $4,196 in ineligible legal costs to the Authority’s asset
management projects, which should have been charged to its central operating
cost center. The ineligible charges included $3,346 in legal fees paid to a law
firm for a central operating cost center employee and $850 charged to research
procurement procedures. We attributed these ineligible charges to nonsystemic
mistakes, but both required repayment.
$225,000 in Cash Improperly Transferred
Authority officials transferred funds between asset management projects in fiscal
year 2012 when the projects did not have the required excess cash.10 They also
did not record all income and expenses for the Presidential Village project in the
general ledger; thus, the Authority’s excess cash calculation was incorrect. This
condition occurred due to inadequate accounting procedures and the finance
staff’s misunderstanding of asset management rules. As a result, the $225,000
transferred reduced the amount of funds to operate the three projects and must be
repaid. Also, unless Presidential Village’s excess cash calculation for 2012 is
corrected, additional ineligible transfers may have been made in fiscal year 2013.
Charges to the Federal
Programs Were Unsupported
Authority officials did not provide adequate supporting documents for $790,555
in costs charged to Federal programs. Specifically, they lacked documents to
support (1) whether their allocation for workers compensation insurance was
equitable, (2) various legal fees charged to the Authority’s properties, and (3)
their reasoning for charging the Section 8 program for general property insurance.
10
The three asset management projects that did not have “excess cash” were Presidential Village, Park City Eleanor,
and Park City Franklin.
7
Unsupported charges Amount
Workers compensation insurance $394,702
In-house legal fees 376,298
General property liability insurance 19,555
Total $790,555
Workers Compensation Insurance Allocations Unsupported
Authority officials charged workers compensation premiums to the Authority’s
central operating cost center, asset management projects, and the Section 8
program based on percentages; however, they lacked support regarding how the
percentages were determined. We questioned the charges because the Authority’s
central operating cost center had 23 percent of the employees but was charged
only 2 percent of the costs and the Section 8 program had 12 percent of the
employees but paid only 6 percent of the costs. During the review, finance
officials provided a proposed allocation plan; however, the plan was inadequate
because it used arbitrary percentages and did not account for insured employees
who did not submit claims but benefited from the insurance and, thus, should
have also been allocated a portion of the costs. Based on one method of
allocating costs, we determined that the Authority may have overcharged its asset
management projects $394,702 and undercharged the Section 8 program and the
central operating cost center $207,821 and $186,881, respectively (see appendix
C for details).
In-House Legal Fees Unsupported
Authority officials could not support their time allocation for in-house and some
miscellaneous legal expenses totaling $376,298. We questioned the support for
in-house legal expenses because contrary to HUD’s requirements, the Authority’s
finance department charged all of its in-house legal staff’s salaries and benefits to
its Federal asset management projects between October 2011 and November
2012. Although some work was performed for the projects during this period,
Authority officials could not show that all staff time was billable to the asset
management projects. We attributed this condition to weak accounting controls
and Authority officials’ failure to require the Authority’s legal department to track
time spent working for Federal housing programs. The Authority changed
procedures in December 2012 and started billing based on an estimate of 5 hours
per case. However, the finance department overstated the number of legal cases
charged, resulting in some overcharges. As a result, the $375,145 charged for in-
house legal services was considered to be unsupported and required support or
repayment. In addition, we identified $1,153 paid for miscellaneous legal
expenses that needed to be supported or repaid.
8
Unsupported Property Liability Insurance Charged to the Section 8 Program
The Authority charged the Section 8 program $19,555 for general property
liability insurance but could not show how the program benefited from the
insurance. Therefore, the $19,555 must be supported or repaid.
Conclusion
Authority officials did not always properly charge and support costs allocated to
the Authority’s Federal housing programs. Specifically, they improperly charged
the Federal programs for central maintenance employees, management and book-
keeping fees, non-Federal maintenance work, insurance, auditing and consulting
fees, and legal costs. In addition, officials transferred cash between asset
management projects that were not eligible for the transfers. These conditions
occurred because Authority officials improperly implemented asset management
procedures and did not provide formal accounting procedures and supervision.
As a result, Federal programs were overcharged by more than $895,000, and
officials could not support more than $790,000 charged to Federal programs.
These improper charges weakened the projects’ financial position and left fewer
funds for operations.
Recommendations
We recommend that the Director of HUD’s Hartford Office of Public and Indian
Housing require Authority officials to
1A. Repay the Authority’s asset management projects from non-Federal funds
$582,562 related to the ineligible cost deficiencies identified in this
finding; specifically, charges of $240,321 for central maintenance
employees; $281,611 for asset management, property management, and
bookkeeping fees; $26,434 for insurance; $10,000 for auditing; $20,000
for consulting; and $4,196 for legal expenses.
1B. Determine the amount the Baldwin Holdings properties owe for
maintenance and administrative services provided by federally paid
workers from October 1, 2009, to the present in accordance with HUD’s
asset management rules, including but not limited to grounds cleanup,
grass cutting, and snow removal, and repay at least $88,290 to the
scattered sites and other asset management projects from non-Federal
funds.
1C. Stop using federally paid public housing maintenance staff to maintain
non-Federal properties.
9
1D Confirm that they have stopped the practice of allocating all of the salary
and benefits costs for three central maintenance employees to the
Authority’s asset management projects.
1E. Charge the heating, ventilation, and air conditioning technician and any
other positions providing services across asset management projects to the
central cost center and charge the asset management projects and if
applicable, the Baldwin Holdings, Inc., properties on a fee-for-service
basis in accordance with asset management rules.
1F. Establish and implement accounting controls to ensure that property
management, book-keeping, and asset management fees are properly
charged to the asset management projects and adequate records are retained
to support the fees charged.
1G. Establish and implement formal written procedures for insurance
allocation plans to ensure that all entities pay for services in proportion to
the benefits received.
1H. Develop and implement procedures to charge the Authority’s Section 8
program, central operating cost center, and non-Federal units an
appropriate share of the annual independent audit costs.
1I. Repay the Authority’s asset management projects 058 (Park City Eleanor),
059 (Park City Franklin), and 061(Presidential Village) $75,000 each for a
total of $225,000 related to the ineligible transfers made in fiscal year 2012
from the asset management projects that received these funds.
1J. Properly account for income and expenses in the Authority’s general ledger
for asset management project 061 (Presidential Village), recalculate the
excess cash for fiscal year 2012, and resubmit the excess cash amount for
this project to HUD’s Real Estate Assessment Center.
1K. Support or repay the Authority’s asset management projects from non-
Federal funds $771,000 related to workers compensation insurance
($394,702) and in-house legal staff salaries and miscellaneous legal
expense ($376,298).
1L. Support or repay the Authority’s Section 8 program from non-Federal
funds $19,555 related to general property liability insurance.
1M. Establish and implement formal written procedures to track time for in-
house legal services charged to the Authority’s Federal programs in
accordance with HUD’s requirements.
10
1N. Establish and implement formal written accounting procedures and train
staff to ensure that expenses are properly allocated and charged in
accordance with asset management rules.
11
Finding 2: Maintenance Costs Were Not Adequately Managed
Authority officials did not adequately manage maintenance labor costs to ensure that they were
reasonable and cost effective when they did not use a rotating schedule for maintenance staff to
avoid unnecessary overtime costs, establish a method to measure and monitor productivity, and
ensure that their in-house maintenance staff had the necessary skills to perform the required
work. We attributed these deficiencies to poor record-keeping and accounting controls and poor
management decisions. As a result, the Authority’s asset management projects paid more than
they should have.
A Rotating Work Schedule Was
Not Used
The Authority’s contract with nonsupervisory maintenance staff allowed for a 7-
day rotating work schedule.11 However, Authority officials scheduled a regular
work week for Monday through Friday and overtime for all weekends.12 Officials
said that they continued with this schedule because they had done so for years and
did not want to make changes during union negotiations. Yet, if they had used the
rotating 7-day work schedule, they could have avoided the unnecessary overtime.
We attribute the unnecessary overtime costs to poor management decisions.
Due to the condition of the Authority’s records, we could not readily determine
the total amount of unnecessary overtime costs. However, we conservatively
estimated that the asset management projects paid at least $45,276 annually for
unnecessary overtime totaling $158,465 during the 3½ years reviewed.13
Officials Lacked an Effective
Method To Measure and
Monitor Productivity
Authority officials lacked a method to measure, track, and evaluate worker
productively. Maintenance was recorded on automated work orders; however,
Authority officials did not review them to ensure that staff completed tasks in a
timely manner and met an acceptable standard of productivity. In addition, work
orders were not completed for grounds, landscaping, snow removal, and janitorial
work. Our review of three maintenance employees’ work orders for 1 week
showed that work orders accounted for only about half of the 40-hour work week.
Additionally, Authority officials stated that a prior executive director promoted all
11
Therefore, some staff could be scheduled to work a 5-day week that spanned a Saturday or Sunday.
12
The overtime schedule included a foreman, a maintenance mechanic, and a maintenance aide for 8 hours per day
plus two janitors for 3 hours per day.
13
$158,465 / 3.5 years = $45,276 per year, which accounts for the difference between regular or straight pay and
overtime at 1.5 times straight pay.
12
of the janitors to maintenance aides without ensuring that they had the skills to
perform their new duties. Thus, Authority officials were concerned that many of
the Authority’s maintenance workers needed additional skills to perform all of the
work required in their job descriptions. As a result, officials could not show that
maintenance was completed in the most cost-effective manner.14 We attributed
this condition to poor management decisions.
During the review, recently hired Authority officials agreed to implement
procedures to track and evaluate maintenance productivity.
Recommendations
We recommend that the Director of HUD’s Hartford Office of Public and Indian
Housing require Authority officials to
2A. Implement a 7-day rotating work week in accordance with the Authority’s
union contract, which if implemented, should decrease overtime costs by
at least $45,276 per year.
2B. Establish and implement formal written procedures to measure the
productivity of the maintenance staff, assess the maintenance staff’s
abilities, and ensure that the staff has the necessary skills to perform the
required work. Authority officials should also ensure that corrective
action is taken when productivity goals are not achieved and provide
training as needed.
14
As required by the Authority’s annual contributions contract with HUD
13
Finding 3: Procurement Procedures Did Not Ensure That Health Care
and Liability Insurance Was Obtained at the Most Cost-
Effective Price
Authority officials did not always ensure that insurance was obtained at the most cost-effective
price. We attributed this condition to restrictive contracts with unionized staff and the
Authority’s reliance on an insurance broker to procure insurance. As a result, the Authority’s
Federal housing programs may have paid more for insurance than necessary, thereby reducing
the amount of funds available for housing services.
Health Insurance Was Not
Competitively Obtained
The Authority’s employee health insurance was not solicited competitively to
ensure that the most cost-effective plan was obtained.15 This condition occurred
because prior Authority officials signed collective bargaining agreements with
union employees that limited the Authority’s health insurance plan to one vender
and a specific plan. During our review, officials were trying to remove the
restriction and said they were hopeful but not certain that the union would
approve the change. In anticipation of a nonrestrictive agreement, officials
contacted the State of Connecticut to obtain a bid for health insurance under the
State’s plan. The director believed the State plan would significantly reduce
costs.
Authority officials said that the Authority’s health care plan was generous
compared with those of other authorities and private businesses. The plan, known
as a “Cadillac” health plan, will be subject to special additional taxes under the
Patient Protection and Affordable Care Act.16 Thus, controlling health care costs
is vital to Federal programs’ current and future financial condition.
Procedures To Procure
Liability Insurance Needed
Improvement
Authority officials did not follow the Authority’s procurement procedures when
they procured insurance policies for more than $25,000. Specifically, they should
15
Regulations at 24 CFR 85.36(c)(1) require full and open competition for all procurement actions.
16
Under the Patient Protection and Affordable Care Act, starting in 2018, insurance companies will be assessed a 40
percent excise tax on “Cadillac” health plans. These are plans with annual premiums exceeding $10,200 for
individuals or $27,500 for families. The Federal Congressional Budget Office predicted, “For policies whose
premiums remained above the threshold, the tax would probably be passed through as a corresponding increase in
premiums”; thus, paying the additional tax would result in fewer funds for housing.
14
have obtained these policies by sealed bid or the Authority’s competitive proposal
method. Instead, they relied on an insurance broker to solicit liability insurance
quotes. As a result, they lacked records to show that the insurance policies were
properly competed and that the bid with the most advantageous price and other
factors was selected. Authority officials expressed concern regarding the broker’s
performance because the broker provided only one quote for general liability and
two quotes for excess liability just before the end of the policy period. In
addition, the premiums were high, with a substantial increase over the previous
policy. However, with the policies about to expire, Authority officials had to
accept the bids to maintain insurance.
During the review, Authority officials solicited insurance quotes from a vender
that had obtained a bidding waiver from HUD. Therefore, if officials obtain
insurance through this vender, the requirement to competitively solicit and
procure insurance would be satisfied, and multiple bids would not be required.
Recommendations
We recommend that the Director of HUD’s Hartford Office of Public and Indian
Housing require Authority officials to
3A. Develop a method to obtain competitively procured health insurance that
is acceptable to HUD and does not restrict insurance to one company.
3B. Revise and implement the Authority’s contracting procedures to ensure
that insurance policies are competitively solicited and procured in a timely
manner and documentation is maintained to show the history for each
procurement. If an insurance company with a HUD bid waiver is used to
procure insurance, a copy of the waiver would satisfy these requirements.
15
SCOPE AND METHODOLOGY
The review focused on whether Authority officials charged expenses to Federal programs that
were eligible, reasonable, and supported. To accomplish our audit objective, we
Reviewed laws, regulations, and HUD guidance related to our objective,
including Federal appropriations acts; Office of Management and Budget Circular
A-87; the Authority’s annual contributions contracts with HUD; public housing
asset management rules; and Housing Choice Voucher and Section 8 program
requirements in HUD handbooks, notices, and guidance.
Obtained an understanding of the Authority’s financial and management controls
and organizational structure.
Interviewed HUD field office and Authority staff.
Reviewed general ledgers, journal entries, budgets, contracts, and cost allocation
plans pertaining to our audit objective.
Reviewed HUD’s most recent monitoring report and independent public
accountant audit reports.
Reviewed the Authority’s policies and procedures, collective bargaining
agreements, and employee job descriptions.
Reviewed all of the approximately $9 million in asset management, property
management, and book-keeping fees charged to Federal asset management
projects from October 2009 to April 2013 to determine whether they were eligible
and supported.
Reviewed more than $5 million in transfers made in fiscal year 2012 between
asset management projects to determine whether the Authority met fungibility
requirements.
Tested a sample of 20 legal charges, which had the highest dollar amount, totaling
$261,245 of the $411,055 in legal fees charged to the Authority’s Federal
programs during our audit period.
Reviewed more than $4.1 million in property and fire, general liability public
officials’, and workers compensation insurance costs that the Authority charged to
its asset management projects to determine whether there were material
overcharges or undercharges.
16
Reviewed $641,137 in accounting and auditing costs charged to the Authority’s
asset management projects to determine whether the costs were necessary,
reasonable, and supported.
Reviewed a sample from approximately $22 million in maintenance labor costs
expended during the audit period. Specifically, we reviewed $240,321 in costs
charged for three central maintenance employees during the audit period to
determine the necessity and reasonableness of the costs.
Conservatively estimated that at least $158,500 of the $1.7 million expended for
overtime during the audit period was for unnecessary scheduled overtime. We
calculated the unnecessary overtime costs by multiplying the number of hours
scheduled for each weekend times the difference between the average hourly rate
for the workers and the average overtime rate for the workers.
Reviewed $88,290 in maintenance labor costs and administrative costs17 charged
to Baldwin properties for maintenance and administrative services provided by
asset management project employees during the audit period to determine whether
the costs were properly charged and reimbursed.
Relied on two automated data systems to test property management and book-
keeping fees. We used the Authority’s Visual Homes electronic database to
determine how many units were occupied each month. We tested 30 units listed
as occupied in the database and used tenant files to verify the database accuracy.
We used HUD’s Public and Indian Housing Information Center (PIC) to
determine the number of HUD-approved vacancies per month. We compared 1
month of vacancies listed in the database to HUD approval letters to verify the
accuracy of the database. Our testing showed that we could reasonably rely on
the databases for the number of occupied units per month and HUD-approved
vacancies.
Note - The number of HUD-approved vacancies before January 2011 was not
available in PIC, and the number of occupied units before January 2011 was not
available in Visual Homes. Thus, we used the Authority’s approved operating
subsidy forms for this period because it was the best available information.
The audit covered the period October 2009 through September 2012 and was extended when
necessary to meet the audit objective. We performed the audit fieldwork from January to July
2013 at the Authority’s administrative office located at 150 Highland Avenue, Bridgeport, CT.
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
17
Administrative labor costs charged were for one employee, who was an asset management program occupancy
specialist.
17
objective(s). We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objective.
18
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:
Program operations – Policies and procedures that management has
implemented to reasonably ensure that a program meets its objectives.
Compliance with applicable laws and regulations – Policies and procedures
that management has implemented to reasonably ensure that resource use is
consistent with laws and regulations.
Safeguarding of resources – Policies and procedures that management has
implemented to reasonably ensure that resources are safeguarded against
waste, loss, and misuse.
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.
19
Significant Deficiency
Based on our review, we believe that the following item is a significant deficiency:
Authority officials did not have adequate controls to ensure that program
objectives were met, that they complied with laws and regulations, and that
they safeguarded resources when they (1) overcharged for management and
book-keeping fees; (2) improperly charged insurance, legal, auditing, and
consulting costs to asset management projects; (3) improperly transferred
cash; (4) did not adequately manage maintenance employees’ overtime
costs; and (5) did not follow their procurement procedures (see findings 1
through 3).
20
APPENDIXES
Appendix A
SCHEDULE OF QUESTIONED COSTS
AND FUNDS TO BE PUT TO BETTER USE
Recommendation Unsupported Funds to be put
Ineligible 1/
number 2/ to better use 3/
1A $582,562
1B $88,290
1I $225,000
1K $771,000
1L $19,555
2A $45,276
Totals $895,852 $790,555 $45,276
1/ Ineligible costs are costs charged to a HUD-financed or HUD-insured program or activity
that the auditor believes are not allowable by law; contract; or Federal, State, or local
policies or regulations.
2/ 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.
3/ 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 Authority officials implement our
recommendation to stop the practice of a 5-day work schedule with scheduled overtime
on weekends and go to a 7-day rotating work week in accordance with the Authority’s
union contract (2A), they can assure HUD that at least $45,276 in excess costs will not be
charged to Federal projects and will be put to better use.
21
Appendix B
AUDITEE COMMENTS AND OIG’S EVALUATION
Ref to OIG Evaluation Auditee Comments 18
18
The complete text of the auditee’s comments was too voluminous for inclusion in the report since it was
embedded throughout our draft report; therefore, we extracted the responses. The auditee’s original submission will
be provided to HUD and can be obtained upon request.
22
Ref to OIG Evaluation Auditee Comments
Finding 1
RESPONSE FOR WORK ORDER CLERK:
Respectfully we disagree with the ineligible findings resulting in the cost
allocated in regards to the Work Order Clerk, during the time period sited the
Work Order Clerk and Maintenance Service was a Frontline Expense (24 CFR
Part. 990), Table 7.2 – Front Line costs and Fee Costs under the Operating
Fund Rules are eligible costs as shown under Front-Line Expenses. All repair
Comment 1 and maintenance costs for the AMP including centralized Work Order
processing provided under a fee for services arrangement, provided cost are
reasonable and necessary. We will provide all of the Work Order Clerk’s time
allocation by Work Orders per AMP that were opened and closed. Therefore,
the finding should be changed from ineligible to unsupported.
RESPONSE FOR HVAC TECHNICIAN
Respectfully we disagree with the ineligible findings resulting in the cost
allocated in regards to the HVAC Technician, during the time period sited the
HVAC Technician and Maintenance Service was a Frontline Expense (24 CFR
Part. 990), Table 7.2 – Front Line costs and Fee Costs under the Operating
Comment 2 Fund Rules are eligible costs as shown under Front-Line Expenses. All repair
and maintenance costs for the AMP including centralized maintenance
processing provided under a fee for services arrangement, provided cost are
reasonable and necessary. We will provide all of the HVAC’s Technician time
allocation by Work Orders/Time card per AMP that were opened and closed.
Therefore, the finding should be changed from ineligible to unsupported.
CENTRAL MAINTENANCE COORDINATOR
We are in agreement with the ineligible misallocation of cost and will
Comment 3 reimburse the AMPs. This should have been a Front-Line cost and we cannot
support this. These costs are Front-Line expenses per 24 CFR Part 990, Table
7.2 and therefore should be moved from ineligible to unsupported however
we cannot document.
SWEEPER OPERATOR:
Portion of cost ineligible related to warehouse operations, we agree a portion
Comment 4 of costs related to vehicle maintenance, deliveries, -
Vehicle expense (maintenance, gasoline and repairs) for site-based vehicles.
These costs are Front-Line expenses per 24 CFR Part 990, Table 7.2 and
therefore should be moved from ineligible to unsupported.
23
Ref to OIG Evaluation Auditee Comments
From the FY2010 audit, the $158,880 seems correct. We reviewed the
management and bookkeeping fees for the overcharge of $183,193 and
$14,538. We agree that BHA overcharged as entries into the records were
based on VisualHomes and never reconciled with PIC. There were times
Comment 5 where PIC numbers were delayed or inaccurate therefore BHA relied on the
VisualHomes numbers. Doing an initial review of the reconciliation it looks
likes Presidential Village was not factored in the overage calculation which
could result in a reduction of about $45,000 of the overage. Please provide us
additional information and documentation to reference your calculations and
finding.
RESPONSE FOR NON-FEDERAL MAINTENANCE TECHNICIAN
Documentation is available for the maintenance and management charges for
2012. The amount was recorded in the books of Baldwin for FY2012. The
hours and names are identified for the work of the management (COS) and the
Comment 6 maintenance crew. This amount was booked and paid back to BHA.
For the previous years, cash was transferred from Baldwin to the AMPs
from 04/1/2010 to 01/4/2011 for work done during 2010 and 2011. The
amount of the cash transferred to the AMPs was$40,589. Specifically
check #1048 for $1,528.69, Check #1064 for $884.19, check #1070 on
10/21/2010 for $5,428.89, check #1088 on 12/21/2010 for $30,818.02.
Comment 7 The COS stopped working on Baldwin in 2012. Therefore, $40,589
should be removed from the finding.
Finally, either checks were cut from Baldwin or Baldwin was charged
directly for Scattered Sites administrative Staff (COS) for mileage and
Comment 8 additional expenses. For example: check #1065 made out to the COS
on 9/7/2010 for $108.
RESPONSE TO INSURANCE OVERCHARGES:
Upon review of the insurance certificate and the allocation of the Public
Officials in FY2011 and FY2012, the OIG recognized an error in their
Comment 9 calculation for Public Officials insurance and significantly reduced the
overcharge amount to approximately $20,000. The exact reduction for public
officials insurance was from $74,046 to $22,344 with proposed report verbiage
changes from OIG. The overcharge of public officials insurance was for the
allocation omitting central office in the journal entry.
24
Ref to OIG Evaluation Auditee Comments
For the $15,262 Baldwin paid for insurance in FY2011-2013. Baldwin
was not billed directly by the Housing Authority. Upon discussions
Comment 10 with the insurance agent, they estimate the Baldwin premium coverage
on the property insurance to be $4,000 per year. Since, 2013 costs were
charged; we would only need to charge Baldwin for 3 years 2010- 2012
or $12,000 and not $15,262. With 2010 being a short year since
Baldwin started that year, the amount will be about $10,000 for the
three years to charge back to the AMPs.
RESPONSE TO UNSUPPORTED CHARGES IN FEDERAL
PROGRAMS:
We agree that $20,000 out of the $30,000 were not eligible. The fee accountant
Comment 11 was performing the duties in the absence of a CFO. Therefore, we dispute the
$10,000.
RESPONSE TO LEGAL COSTS MISTAKENLY CHARGED:
We agree to the $4,196 in ineligible legal costs.
RESPONSE TO IMPROPERLY TRANSFERRED CASH:
Pursuant to 24 CFR 990 paragraph 6.6 Excess Cash and Fungibility, excess
cash available can be calculated as the PHA closes its books for the year and is
Comment 12 able to make the calculation. At that time excess cash can be used. However,
the final amount of excess cash available is based on the approved audit
submission. If the PHA has already moved excess cash over the amount as
calculated using the audited numbers the receiving AMP or COCC must
return that money.
Even though the excess cash was available, BHA transferred the funds after
the close of the books but before the approved audit transmission. BHA
concurs that they should pay the funds back from FY2012 although BHA will
take the transfer of funds in FY2013.
25
Ref to OIG Evaluation Auditee Comments
Furthermore, several AMPs have more than $225,000 in FY2013. For example
Marina Village AMP002 has $354,034, Trumbull Gardens AMP004 has
Comment 12 $465,245 and Scattered Sites 2 AMP 882 has $411,681. Therefore, we can put
the transfer back in FY2012 and properly transfer it again in FY2013 without
affecting any Asset Management Fees charged in FY2013 for any of the
AMPs.
RESPONSE TO WORKS COMPENSATION:
We agree that the original allocation calculation was not completely accurate,
however we dispute OIG’s allocation rate. BHA did a preliminary review of
Comment 13 FY2010-FY2012 based on insurance rates charges of .27/$100 payroll for
clerical staff and $10.69/$100 payroll for maintenance staff. This allocation
resulted in an underpayment of $70,000 for Central Office, an underpayment
of $5,000 for AMPs and an overpayment of Section 8 by $75,000 for the 3
year period.
RESPONSE TO UNSUPPORTED IN-HOUSE LEGAL FEES:
Legal department tracks the amount of work performed for each AMP monthly
and did so during this time frame. We agree that these fees were unsupported
however; backup documentation will support the work load of cases for each
Comment 14 AMP for this time frame which will exceed the $376, 298 figure as outlined in
the OIG draft response. This will be broken down on a fee for service basis
and the amount of time taken to complete each service. Due to the cost
reasonableness factor it is far more cost effective to charge a flat fee for
service to the AMP then bill the AMP’s on a hourly basis for legal work
performed on the AMP’s behalf.
RESPONSE TO PROPERTY LIBABILITY INSURANCE:
We agree that these findings are unsupported and will be paid back.
26
Ref to OIG Evaluation Auditee Comments
Finding 2
RESPONSE TO ROTATING WORK SCHEDULE:
We agree with the findings and are currently negotiating union contracts that
will resolve this issue. The 2311 Maintenance Union consists of Janitors,
Comment 15 Maintenance Aides, and Maintenance Mechanics. They have a 7 day work
schedule in their contract that would avoid some overtime cost, however the
818-12 Asst. Manager/Foreman position does not allow for the 7 day work
week and their contract therefore does not provide supervision to the
maintenance staff. A proposal is on the table for union negotiations to include
the 7 day work week in the Asst. Manager/Foreman unit.
RESPONSE TO LACK OF EFFECTIVE METHOD TO MEASURE
AND MONITOR PRODUCTIVITY:
We agree that we lacked previous methods to measure and monitor
productivity, however it is now a requirement that Work Orders must now be
Comment 16 opened for all work performed including grounds, landscaping, snow removal,
and janitorial work. GPS tracking devices have been placed in all maintenance
worker cell phones to account for all hours worked. Maintenance staff cell
phones are also equipped to open and close work orders from the field. Lastly,
weekly productivity reports are now required by the sites.
Finding 3
RESPONSE TO HEALTH INSURANCE WAS NOT COMPETITIVELY
OBTAINED:
We agree with the findings and BHA currently has an RFP out for Employee
Comment 15 Benefits Brokerage Services to obtain a broker who will competitively obtain
the most cost effective health insurance plan. In the current union negotiations,
a proposal by BHA management is for a HSA plan which can average a 22
percent reduction in plan costs.
27
Ref to OIG Evaluation Auditee Comments
RESPONSE TO PROCURE LIABILITY INSRANCE:
We agree with these findings that BHA did not follow procurements standards
Comment 15 however the insurance agent did make an attempt to competitively procure the
insurance in FY2011-2012. The agent solicited about 15 quotes via email and
chose the best offer from those. Starting Jan 1, 2013, BHA has contracted with
Haig, a HUD approved and federally exempt company for procuring
insurance, for their business liability and auto insurance.
28
OIG Evaluation of Auditee Comments
Comment 1 We determined that the work order clerk’s costs are ineligible and require
repayment. To support charging these costs to the Asset Management Projects
(AMP), officials would need to show that the services were reasonable and
necessary in accordance with HUD’s standards, which stipulate: “The norm in
multifamily housing is that work order processing is a function handled on-site.
A PHA [public housing agency] may charge the cost of centralized work order
processing only if the PHA documents/justifies that the cost is reasonable and
necessary. A prorated front-line administrative function must not cost more than
what the project would incur if performed on-site. In all instances, front-line
prorated costs must be reasonable, necessary, and based on services provided.
AMPs with on-site staff that can provide these functions for themselves may not
also be charged these services.”19
Comment 2 As indicated in footnote 4, we did not include the heating, ventilation, and air
conditioning technician’s salaries and benefits in the costs that we questioned as
ineligible or unsupported. We agree that if properly implemented, fee for service
billing procedures should ensure that future costs are properly charged.
Comment 3 We classified the central maintenance coordinator’s costs as ineligible because the
majority of her tasks were supervisory central maintenance duties, which are not
front-line costs and, thus, not chargeable to the AMPs now or in the future.
However, Authority officials’ planned actions are responsive to our
recommendation
Comment 4 The majority of this employee’s assigned tasks were for the warehouse, which
officials agreed were not eligible. However, during the audit resolution process,
if officials provide documentation showing that billable services were provided to
the AMPs in accordance with HUD’s asset management rules, we would agree
that a reasonable amount might not require repayment. When evaluating billable
services, HUD should consider that the sweeper operator told us that he did not
repair vehicles or change the oil because these functions were contracted.
Comment 5 Authority officials agree that our calculation of the overcharges of $158,880 in
fiscal year 2010 is correct, and it is true that we did not include the amount of
management and book-keeping fees that Presidential Village may have billed for
in 2012 and 2013. However, if officials want to recompute the overcharged
amounts for these years, they will have to do so with HUD during the audit
resolution process, and if needed, we will provide our calculations.
Comment 6 We agree that some records for maintenance and administrative costs were
maintained for 2012. However, the records did not show all of the maintenance
19
PIH Notice 2007-09 Supplement - Changes in Financial Management and Reporting for Public Housing Agencies
Under the New Operating Fund Rule (24 CFR Part 990)
29
services provided by the projects, and there was no evidence that the Federal
projects were paid for the services. General ledger entries shown to us on
December 3, 2013, disclosed that Baldwin paid the Authority’s central operating
cost center, not the Federal projects, for the services.
Comment 7 Officials provided no records showing that the referenced checks were credited to
the scattered sites cash account(s); thus, we considered the amounts not paid.
Regarding the cost of these services, this employee told us she worked for
Baldwin up to May 2012; however, we found that officials charged these costs up
to September 2012. Therefore, during the audit resolution process with HUD,
consideration should be given to removing the portion of costs between June and
September of 2012 if the appropriate supporting documentation is provided. To
ensure that the AMPs did not pay for any services between May and September
2012, the documentation should show who performed these duties for Baldwin
between May and September 2012 and the source of funds used to pay for the
services.
Comment 8 We did not review or include mileage and additional expenses in this report.
Comment 9 We agreed and reduced the amount of ineligible public officials’ insurance from
$74,046 to $11,172 (represents annual cost).
Comment 10 We did not question costs for 2010 and added a footnote to clarify that the
$15,262 was charged to the AMPs in 2012 and 2013 ($7,965 in 2012 and $7,297
in 2013). Regarding the 2012 charges; officials provided no basis or support for
their $4,000 estimate; however during audit resolution HUD may consider the
estimate and adjust the amount requiring repayment if officials provide an
adequate basis and support. Regarding the 2013 charges we discussed this issue
with the chief financial officer, and he told us that he reversed charges to the
AMPs for 2013 and charged non-Federal Baldwin and Chip DIP properties for
their share of property insurance for fiscal year 2013. Therefore, during the audit
resolution process, if documentation is provided to HUD showing the reversed
charges, the $7,292 that we questioned in fiscal year 2013 will not require
repayment.
Comment 11 Authority officials agree that the questioned $20,000 is ineligible and should be
repaid. However, regarding the additional $10,000, since the Federal projects
paid the Authority a management fee in part to maintain a chief financial officer,
the $10,000 in additional audit costs incurred as a result of the official’s failure to
hire a chief financial officer was, in effect, a double payment. Thus, this amount
is an ineligible cost to the Federal projects that should be repaid.
Comment 12 The Authority agreed to return the ineligible 2012 transfers and proposed to make
transfers for fiscal year 2013. We agree that the 2013 transfers may be made in
accordance with HUD’s asset management rules for excess cash. However,
before the Authority transfers funds in 2013, HUD should ensure that the
30
Authority properly accounts for Presidential Village’s 2012 income and expenses,
and properly calculates and reports excess cash for 2012 before it transfers any
funds from this AMP to another AMP.
Comment 13 Authority officials agree that their allocation of workers compensation premiums
was not accurate, and they also dispute our computations. However, officials
need to submit a revised allocation plan to HUD, during the audit resolution
period, to support their figures or repay the costs.
Comment 14 Any backup documentation must be provided to HUD during the audit resolution
process, and HUD should ensure that the Authority’s billing for corporate legal
services complies with HUD’s requirements20 in that “legal fees must be directly
related to the operation and management of the AMP, including tenant lease
enforcement actions, landlord-tenant disputes, and other AMP-related legal
matters. Also, any charges to a project conducted by Central Operating Cost
Center legal staff must be based on services received by the project and
documented by time records.”21 Therefore, any fee for service billing structure
must be supported with time records to support the charges, and HUD will need to
evaluate the Authority officials’ corrective actions and determine whether they are
appropriate.
Comment 15 Authority officials’ actions are responsive to our recommendation; however,
HUD will need to evaluate these corrective actions and determine whether they
are appropriate.
Comment 16 We agree that if properly implemented, the actions described should improve
monitoring of maintenance productivity. However, to fully address our
recommendations Authority officials need to (1) develop and implement
procedures to assess the maintenance staff’s abilities, (2) ensure that the staff has
the necessary skills to perform the required work, and (3) ensure that corrective
action is taken when productivity goals are not achieved and provide training as
needed.
20
24 CFR Part 85, HUD Litigation Handbook 1530.1, REV-5, and PIH Notice 2006-9
21
PIH Notice 2007-09 Supplement - Changes in Financial Management and Reporting for Public Housing Agencies
Under the New Operating Fund Rule (24 CFR Part 990) (F.01), table 7.2
31
Appendix C
OIG ESTIMATE OF WORKERS COMPENSATION
INSURANCE OVERCHARGES AND UNDERCHARGES
Audited workers compensation insurance cost allocation
Based on # of staff - # of claims - and claim amount
(with each factor assigned 1/3 of the total allocation rate)
Over (under)
Audited Over (under) Audited Over (under) Audited Over (under) charged by
Charged amount charged Charged amount charged Charged amount charged program
Program - entity 2010 2010 2010 2011 2010 2011 2012 2010 2012 2010-2012
Asset mangement project # and name -
702 - Marina Village $ 99,452 $ 63,672 $ 35,779 $ 77,589 $ 50,650 $ 26,939 $ 132,897 $ 71,205 $ 61,692
705 - P.T. Barnum 86,467 60,164 26,303 68,940 47,859 21,081 97,909 67,282 30,626
706 - Greene Homes 83,806 77,098 6,708 68,642 61,330 7,312 69,412 86,219 (16,807)
707 - Fireside 46,359 24,979 21,380 35,042 19,870 15,172 49,961 27,934 22,027
709 - Harborview Towers 46,656 55,560 (8,904) 35,042 44,197 (9,155) 31,526 62,133 (30,607)
744 - Trumbull Gardens 71,050 78,753 (7,703) 52,140 62,646 (10,506) 77,410 88,070 (10,660)
781 - Scattered Sites I 55,432 36,597 18,836 49,406 29,112 20,294 67,371 40,926 26,444
782 - Scattered Sites II 91,689 48,362 43,327 70,829 38,471 32,358 126,848 54,083 72,765
Public housing asset mangement projects $ 135,726 $ 103,494 $155,482 $394,702
080 - Section 8 program 40,766 111,629 (70,864) 36,108 88,799 (52,691) 40,570 124,836 (84,266) (207,821)
650 - Central operating cost center $11,874 $76,736 ($64,862) $10,239 $61,042 ($50,803) $14,599 $85,815 ($71,216) ($186,881)
This table shows how OIG estimated that Authority officials overcharged the Authority’s asset
management projects $394,702 and undercharged the Section 8 program and central operating
cost center $207,821 and $186,881, respectively, during fiscal years 2010 through 2012.
This cost allocation plan allocates costs to each entity based on three factors: (1) the
number of staff members in each entity, (2) claims of more than $1,000, and (3) the claim
amount for each entity. We believe this methodology is reasonable because it accounts for
all employees that benefited from the insurance and places equal weight on the factors that
affected the amount of premiums the insurance company charged.
32
The Housing Authority of the City of Bridgeport, CT, Did Not Always Ensure That Expenses Charged to Its Federal Programs Were Eligible, Reasonable, and Supported
Published by the Department of Housing and Urban Development, Office of Inspector General on 2014-01-24.
Below is a raw (and likely hideous) rendition of the original report. (PDF)