We audited the Cherokee Nation in accordance with the U.S. Department of Housing and Urban Development (HUD), Office of Inspector General’s goal to review funds provided under the American Recovery and Reinvestment Act of 2009. Our objective was to determine whether the Nation complied with Recovery Act requirements for procuring, expending, and reporting its formula Native American Housing Block Grant funds received under the Recovery Act.
The Nation generally administered its $11.8 million grant according to Recovery Act requirements. However, it did not obligate $215,000 of the grant award by the obligation date because Nation officials did not completely understand the obligation requirements. As a result, it incorrectly certified that it had obligated its funds. Additionally, the Nation did not keep adequate trip log reports to support that it used 8 of 17 vehicles as required. This condition occurred because staff and management did not comply with the Nation’s policies and procedures. As a result, management could not support that $16,902 spent on one vehicle was an eligible cost.
We recommended that HUD require the Nation to (1) implement policies and procedures that are consistent with HUD requirements when obligating funds to subrecipients, (2) support that a vehicle was used as required or repay $16,902 to the U.S. Department of the Treasury from non-Federal tribal funds and (3) ensure that its staff and management fully comply with its procedures for completing trip log reports.