Department of Housing and Urban Development, Office of Inspector General | Housing and Urban Development | Housing Authority of the SAC and Fox Nation, Shawnee, OK

Housing Authority of the SAC and Fox Nation, Shawnee, OK

Published by the Department of Housing and Urban Development, Office of Inspector General on 1998-06-26.

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

U.S. Department of Housing and Urban Development
Southwest District Office of Inspector
General
1600 Throckmorton, Room 404
Post Office Box 2905
Fort Worth, Texas 76113-2905
(817)978-9309 FAX (817)978-9316
http://www.hud.gov/oig/oigindex.html

June 26, 1998 98-FW-202-1812

MEMORANDUM FOR: Wayne Sims, Administrator
Office of Southern Plains
Native American Programs, 6IPI

FROM: D. Michael Beard,
District Inspector General for Audit, 6AGA

SUBJECT: Citizen Complaints
Comprehensive Grant Program
Housing Authority of the Sac and Fox Nation
Shawnee, Oklahoma

In response to tribal members’ complaints, we have reviewed allegations against officials
of the Housing Authority of the Sac and Fox Nation (the Authority). Our objective was to find
out whether the members have valid complaints and decide whether the complaints justify an in-
depth audit of the Authority’s Comprehensive Grant and Mutual Help housing programs.
Members alleged:

1. Authority officials wrongly used Comprehensive Grant funds to rehabilitate a mutual help
house after the homeowner had paid off the house. Also the homeowner was not an
Indian and the family was not a low or moderate income family.
2. Officials changed a bid amount so the complainant’s company would not get the contract.
3. Officials paid an excessive amount to rehabilitate a mutual help house in Tryon,
Oklahoma.
4. Officials violated requirements against conflicts of interest by awarding electrical contracts
to the father of the Authority’s construction manager.
5. Officials awarded work to contractors who did not have a bond.
6. Officials use intimidation to control program participants.
7. Officials ignore the waiting list when assigning families to new houses.

The review focused on activities of the Authority related to the complaints. To achieve
the objective, we talked to complainants and officials of the Authority and HUD’s Southern Plains
Office of Native American Programs. We reviewed construction and participants' records and
files of the Authority and documents provided by complainants. We reviewed applicable criteria
and the most recent independent auditor report. We also viewed the work on a mutual help house
in Tryon, Oklahoma.

If you have questions, please call Jerry R. Thompson, Assistant District Inspector General
for Audit.

SUMMARY

Six of the seven allegations are not valid. One is valid, but the matter does not violate HUD
requirements. The Sac and Fox Housing Authority did not require contractors to be bonded for
housing modernization work under the Comprehensive Grant Program. HUD requires
contractors to be bonded when the contract amount is $100,000 or more. However, no housing
modernization contract reached $100,000. We concluded the complaints do not justify an in-
depth audit of the Authority’s programs.

BACKGROUND

The Sac & Fox Nation of Oklahoma created the Authority under the provisions of the laws of the
State of Oklahoma. Until March 1998, the Authority administered Public Housing Programs
authorized under the United States Housing Act of 1937. Since March 1998, the Native
American Housing Assistance and Self-Determination Act of 1996 has authorized the Authority’s
administration of Public Housing Programs. The new regulations separate Indian Housing
Programs from the 1937 Housing Act.

The Authority administers the Mutual Help Homeownership Opportunity Program. Each low-
income family enrolled in the program, and occupying a house under the program, has signed a
lease with an option to purchase the house. During the period of occupancy, the Authority
amortizes the purchase price in accordance with a purchase price schedule. The Authority can
convey title to the homebuyer when the homebuyer has accumulated enough funds in an equity
account to cover the balance of the purchase price. The Authority can complete modernization
work on houses that it subsequently conveys before completion of the work if the Authority
included those houses in its 5-year Comprehensive Grant Plan.

HUD awards grants to the Authority for funding modernization work on Mutual Help houses
under the Comprehensive Grant Program. During the fiscal year ended June 30, 1996, the period
for which the Authority had its most recent single audit completed, the Authority received
$529,806 and expended $589,255 in Comprehensive Grant Program funds.

2
RESULTS OF REVIEW

Allegation 1: Authority officials violated Comprehensive Grant Program requirements when they
used grant funds to remodel a Mutual Help house that the homeowner had paid off. Also, the
homeowner was not an Indian and was not a low or moderate income family.