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The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited HUD’s oversight of public housing agencies’ Section 8 Project-Based Voucher programs (program). The audit was part of the activities in our fiscal year 2010 annual audit plan and our strategic plan to help HUD resolve its major management challenges. Our objective was to determine whether HUD had adequate oversight of public housing agencies’ programs to ensure that program funds were used in accordance with HUD’s requirements.

HUD’s Office of Public and Indian Housing lacked complete and accurate information to adequately monitor its program.

HUD’s Office of Public and Indian Housing also did not adequately monitor the addition of new projects to its program. It did not implement adequate procedures and controls to ensure that its program was operated according to its and the public housing agencies’ requirements.

We informed HUD’s Deputy Assistant Secretary for Field Operations of a minor deficiency through a memorandum, dated November 16, 2010.

We recommend that HUD’s Deputy Assistant Secretary for Field Operations provide additional guidance to public housing agencies to ensure accurate reporting by agencies of their information in HUD’s Public and Indian Housing Information Center, the Voucher Management System, and the agencies’ plans. The reporting requirements should include requiring agencies to certify to the accuracy of their information reported to HUD. In addition, the Deputy Assistant Secretary should (1) issue specific guidance to its field offices so they can ensure that the program’s reporting requirements are adequately monitored and (2) implement adequate monitoring procedures and controls for the oversight of its program to ensure that public housing agencies select and adequately document only eligible projects and use program funds in accordance with program requirements.