The Management of the Housing Authority of the City of Taylor, Taylor, TX, Did Not Exercise Adequate Oversight of Its Programs

Date Issued: 
Thursday, October 2, 2014
Publication/Report Type: 
Memorandums
Memorandum Number: 
2015-FW-1801
Program Area(s): 
Public and Indian Housing
State: 
Texas
Summary: 

In accordance with our annual audit plan to review public housing programs and because of an anonymous complaint and issues identified by the San Antonio Office of Public Housing, we reviewed the Housing Authority of the City of Taylor, Taylor, TX.  Our objectives were to determine whether the Authority operated its public housing and related grant programs in accordance with the U.S. Department of Housing and Urban Development’s (HUD) requirements and to determine whether the complainant’s allegations were valid.  Specifically, the complainant alleged that the former executive director gave away, sold, or transferred Authority-owned properties to other entities.  The Office of Public Housing identified additional concerns regarding ineligible Section 8 Homeownership Voucher Program participants, unsupported salaries for employees working at multiple properties, and improper expenditures by a former executive director.

Both the complainant and HUD raised valid issues concerning improper activities.  The Authority did not implement adequate policies and procedures and did not properly manage its public housing and related grant programs in accordance with HUD requirements.  Specifically, the Authority (1) did not properly account for its funds, (2) allowed director 1 to improperly transfer assets, (3) paid unsupported salaries to employees who worked on multiple activities, and (4) allowed director 1 to transfer funds to lease and purchase a parking lot the Authority already owned, and (5) allowed director 2 to circumvent financial and procurement controls.  In addition, the Authority violated the conflict-of-interest provisions of the Section 8 Homeownership Voucher Program and the HOME Investment Partnerships program.  These issues occurred because management, consisting of the board and the various prior executive directors, did not follow HUD’s requirements and did not implement adequate internal controls.  Consequently, the Authority lost control and possession of a $255,000 property it owned, lost control of two component units with net asset values of more than $1.7 million, and incurred $392,059 in questioned costs...

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