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We audited the City of Miami Beach’s Community Development Block Grant (CDBG) program in accordance with our annual audit plan because it had projects overseen by the same administration questioned in our audit of the City’s HOME Investment Partnerships Program. In addition, the U.S. Department of Housing and Urban Development’s Miami Office of Community Planning and Development ranked the City as high risk in its 2015 risk assessment. Our objective was to determine whether the City ensured that the drawdowns of CDBG funds were supported and allowable.

The City did not always comply with CDBG requirements.  Specifically, it did not ensure that drawdowns were properly supported and allowable for seven activities.  This condition occurred because the City lacked due diligence when administering its CDBG activities.  As a result, it charged $336,150 in questioned costs to the CDBG program.

We recommend that the City (1) provide supporting documentation or reimburse its program for $227,587 in unsupported expenditures from non-Federal funds and (2) reimburse its line of credit for $108,563 used for ineligible costs from non-Federal funds.