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Texas Department of Housing and Community Affairs

An Audit of Management Controls at the Texas Department of Housing and Community Affairs

April 1998

Report Number 98-037

Overall Conclusion

The Texas Department of Housing and Community Affairs (Department) should improve controls over the process used to award and administer federal funds for housing programs to its related nonprofit corporation, the Texas State Affordable Housing Corporation (Corporation), to ensure that delays in committing and expending funds are minimized. Delays in the commitment and expenditure of awarded funds may put the Department's federal funds at risk of not being expended within the five-year statutory time frame.

Key Facts and Findings

The Department awarded $17.6 million in federal Home Investment Partnership Program (HOME) funds to the Corporation for the fiscal years 1995 and 1996. As of June 1997, the Corporation had awarded $6.7 million, or 39.3 percent of its total awards, to specific eligible housing projects. The U.S. Department of Housing and Urban Development awarded the Department approximately $59 million of HOME funds for this two-year period.

The Department also needs to ensure that policies and procedures affecting the award process are implemented and enforced so that changes in award criteria for the Housing Trust Fund program are thoroughly analyzed and the Department's Board has complete information in making its decisions.

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