An Audit Report on the Housing Trust Fund and HOME Investment Partnerships Programs at the Department of Housing and Community Affairs
July 2005
Report Number 05-047
Overall Conclusion
The Department of Housing and Community Affairs (Department) cannot ensure that it allocates funds from the HOME Investment Partnerships (HOME) and Housing Trust Fund programs to the parts of the State with the highest need. Specifically, in fiscal year 2004, the regional allocation formulas the Department used to allocate funds from these programs did not contain all statutorily required information. Additionally, the Department may not be obtaining information necessary to identify regional housing needs because it did not comply with statutory requirements regarding its coordination with regional development coordinators across the state.
The Department awarded HOME funds in accordance with federal requirements. It awarded funds from the Housing Trust Fund in accordance with state requirements, but it should work to increase the number of qualified applicants for that program. In fiscal year 2004, the Department did not award approximately $839,000 of the $5.4 million in funds available from the Housing Trust Fund program. (In addition to the $5.4 million in available funds from the Housing Trust Fund, the Department also was permitted to carry forward $5.8 million in funds from the Housing Trust Fund that it had awarded in the prior fiscal year but had not yet spent.)
According to the Department, it did not receive enough qualified applicants to be able to award more funds from the Housing Trust Fund. The General Appropriations Act (78th Legislature) established a performance measure for the Department to serve 1,686 households through the Housing Trust Fund program in fiscal year 2004. According to the Department's 2005 State of Texas Low Income Housing Plan and Annual Report, the Department served 325 households in fiscal year 2004 through the Housing Trust Fund program.
Although the Department's contract award process for the HOME and Housing Trust Fund programs is generally objective, noncompliance with certain application scoring requirements diminishes the Department's objectivity in awarding contracts.
The Department's monitoring procedures generally ensure compliance with certain HOME and Housing Trust Fund program requirements. However, the Department should make improvements to its monitoring risk assessment process for the HOME program. Specifically, the Department does not have documented procedures to determine the weights applied to the risk assessment for this program.
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