HUD report questions million spent by Norfolk housing authority

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by Nick Ochsner, 13News Now

WVEC.com

Posted on December 20, 2013 at 7:29 PM

Updated Saturday, Dec 21 at 6:11 AM

NORFOLK -- A report released this week by the Department of Housing and Urban Development's Inspector General says the City of Norfolk spent millions of dollars on projects using community development block grants that have never been finished.

The report, released on Tuesday, also found that the city did not have the proper paperwork to support nearly $2.5 million in CDBG grant money spent on other projects.

Click here to read the report from the inspector general. 

Auditors with the HUD Inspector General's office targeted Norfolk because, with 180 open projects currently open, the city has the highest number of open CDBG projects in Virginia.

The audit found that the city could not justify or adequately support $9.1 million in program funds it spent.

Auditors attribute the problems to poor record keeping and a failure to properly plan for projects.

For example, auditors also found that 14 of the 16 projects they reviewed had failed to meet national objectives aimed at helping low-income people find housing and fighting community blight.

The audit found 10 open projects that were more than 10 years old. Some projects began as far back as 1997.

The 10 outdated projects accounted for $4.1 million in spending.

Lori Crouch, a spokeswoman for the City of Norfolk, would not directly address the findings of the audit but released a statement questioning the auditor's methodology:

The HUD audit focused on accounts more than a decade old," Crouch said. "Because of the age, detailed documents were not available.  We are working with the Richmond HUD field office to resolve.  The process is not complete. 

The IG's report shows city leaders raised that same defense to HUD officials after reviewing the agency's preliminary findings.

A HUD auditor responded by saying federal law requires documents must be kept for all open programs, regardless of how old they are.

"The age of the activities is not a valid justification for the City's not having the appropriate supporting documentation," an auditor wrote.

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