Provide support for the reimbursement to its housing program of $107,036 from non-Federal funds if justification cannot be provided to support that the overhead and profit amounts paid to the contractors were reasonable.

Perform a review of the remaining 453 contracts and any additional contracts issued under the old invitations to bid to ensure that overhead and profit amounts charged by contractors were reasonable. The State should either provide justification or support for the reimbursements to its housing program from non-Federal funds for the unsupported amounts.

Update policies and procedures to ensure that a cost reasonableness assessment is performed on all cost elements, including the overhead and profit percentages charged by contractors for future contracts.

Develop and implement procedures to ensure the execution of newly developed policies that require contractors that work on multiple programs to provide adequate support to distinguish the proper amount of time and cost spent on each program. The State should also be required to provide procedures that implement the policy changes.

Train staff to ensure that expenditures, including payments made to contractors, are classified to the proper project activity in the DRGR system and provide support for training conducted.

Develop and implement policies and procedures to ensure that subgrantee agreements are executed in a timely manner, effective monitoring is performed, and subgrantees maintain an emphasis on using their CoC funds, thereby preventing similar occurrences of $3.5 million (see appendix D) in CoC funding going unused.

Develop and implement strategies to address capacity and organizational problems or obtain technical assistance to address these issues.

Develop and implement procedures and controls to clearly define and update point-of-contact staff for subgrantees.

Work with HUD and subgrantees to reevaluate its CoC program’s performance goals and set targets that help to ensure that funds for future CoC grants are fully and effectively used to advance the goal of ending homelessness.

Adequately support the eligibility of payroll costs or repay its CoC grants $824,302 from non-Federal funds.

Adequately support the eligibility of rent costs or repay its CoC grants $55,545 from non-Federal funds.

Develop and implement additional written procedures and controls to ensure that employees charge time in accordance with program requirements and that the Authority fully documents and supports that salary and rental cost allocations are charged to its CoC grants in accordance with its cost allocation plan.

Complete and implement policies and procedures to ensure that APRs are submitted by the closeout deadline.

Develop and implement policies and procedures to ensure that relevant personnel are routinely and regularly trained on the grant closeout process.

Revise its methodology to identify slow spenders, including appropriate baselines and the definition of slow spenders.

Update its policies and procedures for tracking expenditures related to slow-spending grantees, including steps for assisting the grantees to expedite spending (including the grantee’s steps or actions to address slow spending), identifying the reasons for the delays with the grant, and documenting the outcome of its efforts.

Corrective Action Taken

CPD updated guidance addressing grantee slow spending through technical assistance, including actions grant managers can take when grantee expenditures do not appear to be “on pace” to meet the expenditure deadlines, and demonstrated it is providing technical assistance to grantees during monitoring. CPD also issued an additional Standard Monitoring Findings and Corrective Actions Guide for its staff to promote a consistent framework for crafting monitoring findings and the corrective actions needed to resolve identified deficiencies and prevent future occurrences. This new resource provides general guidance and examples for presenting Finding components in monitoring reports for fourteen topics including, “Failure to Meet Timeliness of Expenditures Requirements.

Establish a reasonable timeframe for grantees to resolve DRGR flags or at a minimum, if a flag cannot be resolved within the established timeframe, have the grantee provide a remediating comment explaining why the flag could not be resolved and a proposed timeline for resolution.

Resolve or remediate outstanding flags for grants B-12-MT-01-0001, B-13-MS-36-0002, B-16-MH-48-0001, and B-16-DL-12-0001 in DRGR.

Require updated projections for grants B-12-MT-01-0001, B-13-MS-36-0002, and B-16-DL-12-0001 and provide assistance to the grantees to ensure that the expenditure deadlines will be met.

Update its policies and procedures to require grantees to identify the reason for variances between the actual and projected expenditures to enhance CPD’s oversight.