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As part of the Office of Inspector General's strategic plan, we audited the Shreveport Housing Authority's (Authority) Section 8 Housing Choice Voucher program (Section 8 program). Our objective was to determine whether the Authority ensured that it made housing assistance payments in accordance with the U. S. Department of Housing and Urban Development's (HUD) Section 8 program requirements. The Authority's contracted Section 8 program administrator, Pendleton Development Corporation (Pendleton), made errors in 96 of 107 (90 percent) statistically selected sample tenant files out of 3,717 files. The errors included, incorrectly calculating family income, paying assistance after families vacated units, using incorrect payment standards, miscalculating utility allowances, and making other errors that resulted in incorrect assistance payments. Pendleton also made errors that did not affect assistance payments but need corrective action. This condition occurred because neither the Authority nor Pendleton had adequate management controls to ensure compliance with requirements. As a result, the Authority paid $18,517 in excess assistance and overcharged families $1,767. Further, we estimate that from September 1, 2005, to September 30, 2007, the Authority made excess assistance payments of more than $320,000. Additionally, the Authority's Section Eight Management Assessment Program (SEMAP) scores for fiscal year 2006 were inaccurate.

We recommend that the Director of the Office of Public Housing, New Orleans, Louisiana, require the Authority to recertify, within the next six months, all families receiving assistance and at the time of the recertifications, review their files for any errors occurring within the previous 12 months. The Authority should repay its Section 8 program or the families as appropriate for any assistance payment errors for the 12 months. The Director should also require the Authority to repay, from nonfederal funds, its Section 8 program $18,517 for overpayments and reimburse families $1,767 for underpayments identified in the audit, and implement adequate procedures and controls over its Section 8 program to ensure that tenant eligibility and assistance payments are supported and determined in accordance with HUD requirements to avoid paying more than $153,000 in excess assistance during the next 12 months. We also recommend that the Director increase oversight of the Authority by entering into a memorandum of agreement with the Authority, reduce the Authority's fiscal year 2006 SEMAP scores, and ensure that the Authority submits accurate SEMAP scores in the future.