We audited the selection and award of the U.S. Department of Housing and Urban Development’s (HUD) fiscal year 2010 HOPE VI revitalization grants, based on a hotline complaint alleging that HUD’s Office of Public and Indian Housing (PIH) (1) selected and awarded fiscal year 2011 HOPE VI funds to grantees that applied for fiscal year 2010 grants but did not publish a notice of funding availability (NOFA) for its fiscal year 2011 funds and (2) made mistakes in calculating points when scoring applications. Our objective was to determine whether the selection and award of grantees for the fiscal year 2010 HOPE VI revitalization grants complied with the HUD Reform Act of 1989 and PIH properly scored its HOPE VI grant applications.
The complainant’s allegations had merit. In particular, PIH did not comply with the HUD Reform Act of 1989 in awarding 2011 grant funds under the 2010 NOFA for HOPE VI revitalization grants. Specifically, it awarded fiscal year 2011 funds without announcing the availability of funds to the general public. It also did not have the application files readily available for review within 30 days after the awards were made. In addition, PIH changed the scores of three applications and supported the changes with conflicting justifications.
We recommend that the Deputy Assistant Secretary for Public Housing Investments implement controls to ensure that increased funding during the grant competition follows the established NOFA procedures and the public is notified. We also recommend that PIH implement quality control procedures to ensure that applications are accurately recorded and supported.