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FOR IMMEDIATE RELEASE: Aug. 11, 2004

Audit on City’s housing program and the role of HEDFC released

The City Auditor’s Office and the Office of Inspector General in the U. S. Department of Housing and Urban Development issued a performance audit of the City’s housing program and the role of the Housing and Economic Development Financial Corporation. The audit focuses on the City’s system for implementing housing policy and HEDFC’s role in the system. HEDFC is the city’s largest sub-recipient of federal housing funds. This is the third audit of the City’s housing programs conducted jointly by the City Auditor’s Office and the HUD Office of Inspector General.

The audit concludes that the City still needs a strategy to address housing needs and measurable goals to determine whether the strategy is working. The City’s failure to set measurable objectives for housing production and its fragmented system for administering housing funds contribute to higher than necessary administrative costs; lack of information for decision-makers; poor communication; delays; and lack of accountability for poor performance. The City has not clearly defined HEDFC’s role in implementing housing policy. The scopes of work in the City’s contracts with HEDFC are broad and performance standards are vague, causing disagreements between the City and HEDFC about whether expenditures or activities are appropriate. Deficiencies in HEDFC’s operations contribute to the lack of assurance that the City is getting the best results for its considerable investment in housing.

The auditors recommend the city manager redesign the City’s processes for administering housing funds to simplify administration, reduce administrative costs, and improve performance and accountability. The city manager agreed with the recommendations. The president and chief executive officer of HEDFC disagreed with the conclusions and most of the recommendations.

This report should be accessible from www.kcmo.org/auditor by 3 p.m. today

    
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