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Auditors: ATL owes $3.9M for mishandling of housing funds
Blown deadlines and sloppy contract oversight may cost the City of Atlanta another $3.9 million in federal low-income housing money.
Atlanta messed up $6.8 million in funding commitments since 2006 under the HOME Investment Partnerships Program, federal auditors said in a Sept. 28 report. That represents nearly two-thirds of all funding reviewed under the program, which is intended to renovate, acquire, build and subsidize rent for housing for extremely low-income families.
Auditors said Atlanta mishandled:
- $2.7 million for which written agreements were never signed,
- $1.3 million for which Atlanta tried to substitute other money to substitute for previously disallowed spending, and
- $2.7 million that was committed after a 2-year deadline had passed, or not at all.
Of that, Atlanta should return $3.9 million to the feds because it could be put to better use elsewhere, the Inspector General for the U.S. Department of Housing and Urban Development said. The decision is up to HUD’s Atlanta office.
Last year, Atlanta returned $1.9 million to the same program because of similar issues. Overall, HUD’s Inspector General has now called for Atlanta to return about a third of the $17 million-plus of HOME funds it has received since 2005.
City officials said the refund would deprive Atlantans of 85 home rehabilitations (at $45,000 per home).
In a response submitted by Atlanta Planning and Community Development Commissioner James Shelby, officials asked HUD to overlook the violations because of extenuating circumstances, including the city’s failure to process accounting adjustments made in the aftermath of the fed’s 2005 audit of HOME funding.
But the Inspector General said the blame falls squarely on city officials:
The recapture could have been avoided if the City had properly met its responsibility to ensure compliance with requirements. The recapture will deprive City residents of program assistance, and the incorrect entries compromised the integrity of commitments in the information system which HUD uses to monitor compliance with commitment requirements and to compile national program statistics.
Atlanta is scrambling to spend another $30 million earmarked for community projects since 2003. Otherwise, the money will have to be returned to the feds when the program expires Dec. 31.