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HUD: DeKalb housing agency misspent $2.5M
By CLAY DUDA
The DeKalb County Housing Authority misspent $2.5 million in restricted funds intended for low-income housing subsidies, federal auditors say.
Restricted funds were used to pay a variety of administrative expenses, as well as costs of five other housing programs, auditors for the U.S. Department of Housing and Urban Development (HUD) said in a report released this week.
“The Authority used net restricted assets to pay salaries for Disaster Housing Assistance program temporary employees, workmen’s compensation for employees of the Housing Choice Voucher program and Disaster Housing Assistance program, rental car expenses for housing inspectors, office supplies, and rental expense for office space.”
The Housing Authority mismanaged the money by failing to maintain separate bank accounts, failing to properly track Housing Choice Voucher funds and failing to implement proper checks and balances, according to the findings released by James McKay, HUD’s regional inspector general.
The program, commonly known as Section 8, allows qualified low-income recipients to use vouchers to subsidize their rent for private housing or in a unit in a publicly-owned housing project. Recipients typically pay no more than 30 percent of their income.
The DeKalb Housing Authority did not assign a separate bank account to voucher funds until January 2010, despite a 5-year-old HUD regulation requiring them to do so, the inspector general said. The agency kept funds for six different housing programs in the same account until late last year.
In December, HUD auditors determined DeKalb’s voucher program should have had a balance of $2.5 million in restricted funds, but a Housing Authority Accountant told them the general ledger was incorrect and the balance was in fact zero.
As a consequence, low-income families may have been shorted by as much as $2.5 million in housing assistance:
“Due to the Authority’s poor control over its net restricted assets, we could not ensure that the funds were used for its housing assistance payments as required.”
Auditors recommended that HUD require the authority to restore the $2.5 million with non-federal funds.
Results of a forensic audit recommended by McKay are expected “on or around” Aug. 30, according to a response letter by Matthew McClammey, the Housing Authority’s interim executive director.