Sneak Preview: HUD Offices To Develop Referral Guidance
(The following was excerpted from a recent article in the Federal Grants Management Handbook.) Officials with the Department of Housing and Urban Development’s (HUD) offices of Public and Indian Housing and Community Planning and Development plan to establish guidelines for referring cases of potential operational and financial noncompliance by public housing authorities (PHAs) and other entities to HUD’s Departmental Enforcement Center (DEC), in response to a recent Government Accountability Office (GAO) recommendation.
HUD established DEC in 1998 to consolidate the agency’s enforcement functions. DEC is responsible for taking enforcement actions against: (1) PHAs that do not pass annual assessments; (2) owners of private, HUD-assisted housing that do not pass operational or financial audit inspections; and (3) local and state governments and nonprofit organizations that do not comply with the requirements of grants they receive from HUD program offices. In federal fiscal year (FY) 2017, DEC received almost 2,800 referrals from nine HUD program offices for oversight and enforcement actions.
GAO reviewed three HUD program offices that account for 73 percent of the referrals to DEC. While GAO found that HUD’s Office of Multifamily Housing had defined thresholds for its staff to determine instances of noncompliance, which could be referred to DEC, the offices of Public and Indian Housing and Community Planning and Development did not.
“These two offices do not provide field staff with specific guidance to help determine which housing agencies or grantees to refer to DEC for possible enforcement action,” GAO explained. “As a result, the offices cannot ensure that decisions on whether to make referrals are made on a well-supported and consistent basis, potentially limiting DEC’s effectiveness in fulfilling its mission of providing independent oversight of HUD’s programs.” For example, GAO noted that the Office of Public and Indian Housing does not provide direction to its field offices on how to use the results of their quarterly risk assessments to identify high-risk PHAs for potential DEC referrals.
DEC and these two HUD program offices have agreed on a target number of elective referrals they should aim to make to DEC each fiscal year. However, neither program office met their targets for referrals to DEC for FY 2016 and FY 2017. The Office of Public and Indian Housing made 25 referrals in FY 2016 and 12 in FY 2017, but had an annual target of 40, while the Office of Community Planning and Development referred six during each of these fiscal years, while having a target of 10. Office of Community Planning and Development field office staff told GAO that they did not fully understand the role of DEC or the assistance it can provide.
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