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We performed an audit examining HUD’s efforts to prevent duplication of benefits when using Community Development Block Grant (CDBG) Disaster Recovery and Mitigation funds.  Our objective was to determine how the U.S. Department of Housing and Urban Development (HUD) assesses the adequacy of grantee procedures to prevent a duplication of benefits, both before and after grant execution.

HUD certified grantees’ high-level processes for preventing duplication of benefits before grant execution and allowed grantees to develop more detailed procedures for individual grant activities later.  However, HUD did not review grantees’ more detailed procedures before grantees began spending funds on program activities.  In addition, HUD certified before grant award that grantees had adequate procedures when the grantees’ procedures did not meet the adequacy criteria HUD established in the Federal Register.  Further, HUD’s adequacy criteria did not include all statutory requirements.  Because HUD certified procedures that did not meet requirements and did not review detailed activity-level procedures before grantees began spending funds, HUD risked grantees’ failing to prevent any duplication of benefits in accordance with the law.

We recommended that the Director of the Office of Disaster Recovery (1) review grantees’ activity-level procedures to prevent any duplication of benefits for adequacy before grantees process applications for assistance and (2) ensure that all applicable requirements for preventing any duplication of benefits are included in the adequacy criteria, grantee certifications, and HUD review checklists supporting the certification.

Recommendation Status Date Issued Summary
2024-FW-0001-001-A Open October 20, 2023 We recommend that the Director, Office of Disaster Recovery, perform monitoring of or otherwise review grantees’ detailed procedures for preventing duplication of benefits for each grant activity within the first year after HUD signs the grant agreement or before grantees process applications for assistance, whichever occurs first.
2024-FW-0001-001-B Open October 20, 2023 We recommend that the Director, Office of Disaster Recovery, develop and implement a process to review grantees’ detailed procedures for preventing duplication of benefits and require grantees to correct any deficiencies identified in the review before grantees process applications for assistance.
2024-FW-0001-001-C Open October 20, 2023 We recommend that the Director, Office of Disaster Recovery, for future grants, develop and implement procedures to ensure that all applicable requirements for preventing any duplication of benefits are included in the adequacy criteria, grantee certifications, and HUD review checklists supporting the certification.