Perform onsite monitoring of the subrecipient that administered project FL0431L4D001403 to ensure that participants are eligible and annual income re-certifications are performed.

Investigate the 14 loans with unpaid mortgage amounts totaling $3,035,819, and require the lenders to obtain the borrowers consent, reinstate the insurance coverage, or take other action as appropriate given the facts of each particular loan.

Remind lenders that voluntary termination is not the correct termination type to record third-party sales and that borrower consent is required to terminate insurance, even if the loans are indemnified.

Improve its procedures for detecting and sanctioning improper voluntary terminations.

Update Handbook 4000.1 to require the voluntary termination of insurance consent form to include an explanation that voluntary termination differs from mortgage insurance premium cancellation and the disclosure of any outstanding partial claims to put $285,215 to better use.

Provide documentation to show that prices paid for purchases of products and services totaling $970,381 were fair and reasonable or reimburse the project from nonproject funds for any amounts that were not fair and reasonable.

Provide documentation to show that payments for work totaling $716,693 complied with applicable building codes or reimburse the project from nonproject funds for payments that did not comply with the codes and take action to bring the work up to code.

Provide documentation to support payments totaling $163,885 or reimburse the project from nonproject funds for payments that it cannot support.

Develop and implement written procedures to ensure that it obtains written cost estimates as required and maintains complete documentation to support expenditures and that contractors performing or managing construction, removal, repair, or improvement work are properly licensed as required.

Reimburse the project $296,787 from nonproject funds for the ineligible legal expenses.

Reimburse HUD $3,892 from nonproject funds for the overpayment of housing assistance.

Correct the errors in the tenant files identified during the audit.

Reimburse NSP2 from non-Federal funds for the $59,523 in ineligible disbursements on the five vouchers.

Provide documentation to support that the $224,868 in NSP2 funds drawn down from the four vouchers was eligible or repay the program from non-Federal funds.

Provide documentation to support that the differences resulting from the payroll costs for the three vouchers, which netted $3,169, were offset in later drawdown vouchers or repay the program from non-Federal funds.

Review all administration drawdown vouchers and provide documentation to support that the drawdowns for estimated payroll costs are reconciled with the actual payroll costs for the pay periods. Any calculated overpayment by NSP should be returned to the program to meet program purposes.

Provide clearer guidance and instruction to PL 113-2 disaster grantees to assist them in establishing an effective internal audit activity.

Establish a recurring training and discussion forum among the PL 113-2 grantees and CPD that enables grantees to share ideas and receive guidance and information about CPD’s expectations regarding the internal audit requirement.

Reevaluate the feasibility of the two Section 108 activities that failed to meet a national objective and determine the eligibility of the $15,814,000 already invested. Any amount determined ineligible must be reimbursed to the program from non-Federal funds.

Require the borrowers to submit a plan for how they will proceed and use the $8,694,000 million in unused commitments to provide the intended benefits and meet program objectives.