MEDIA ADVISORY
May 17, 2005
The U.S. Department of Housing and Urban Development’s (HUD) Office
of the Inspector General (OIG) issued an interim audit report on May 16,
2005, detailing problems with the Office of Healthy Homes and Lead Hazard
Control’s (OHHLHC) FY 2004 grant administration process. The OIG
issued the report before completing its full audit because it found significant
conditions that warrant immediate management attention. In the report, the OIG found that OHHLHC inappropriately awarded its
FY04 grants. While the OIG’s full audit continues to delve more
deeply into the problems, the OIG recommends that the Department “take
immediate action to ensure the FY 2005 grant award process is completed
according to the notice of funding availability requirements and HUD’s
established grant processing procedures.” As part of its preliminary audit, the OIG reviewed seven of the more
than 200 grant applications received in the FY04 cycle. It found errors
in the award process for all seven, including errors that caused four
applicants to either receive an award they were not entitled to or to
lose an award they should have received. Specifically, two ineligible
applicants received grant awards totaling $5 million, one applicant was
awarded $957,900 for a grant that was not properly supported, and one
applicant was denied a grant of $365,736 that it should have received.
The OIG said that in large part, these problems occurred because HUD
and OHHLHC established a deadline of September 30, 2004, to process and
award the grants without having an effective process in place to do so.
The OIG report states, “To meet this deadline, the Office of Healthy
Homes and its contractor did not always follow established procedures
in evaluating and scoring the grant applications. Specifically, the Office
of Healthy Homes (1) did not ensure all of the contractor’s staff
was properly trained, (2) did not maintain a proper log to track when
applications were received, (3) did not ensure the contractor performed
appropriate initial reviews and evaluation of the grant applications,
(4) did not perform adequate quality assurance reviews of the contractor’s
work, and (5) negotiated contracts after the grants were executed.” The OIG reports that the contractor “admitted up-front that they
had a limited capacity to carry out the required activities” –
and that only 18 of the 30 contract reviewers received training. The OIG’s interim report confirms concerns raised by the Alliance
for Healthy Homes, other organizations, and Congressional sources about
systemic flaws in the 2004 award process. (www.afhh.org/aa/aa_policy_federal_agencies_request_for_IG_Invest.pdf).
The full text of the OIG interim report will be posted soon at www.hud.gov/offices/oig/reports/oiginter.cfm#2005. # # # The Alliance for Healthy Homes is a national nonprofit
policy and advocacy organization working to protect children from lead
and other health hazards in and around their homes by building capacity
for primary prevention in communities at risk.
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