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Community Development Block Grants: Program Offers Recipients Flexibility but Oversight Can Be Improved

GAO-06-732 Published: Jul 28, 2006. Publicly Released: Aug 28, 2006.
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Highlights

The Community Development Block Grant (CDBG) program provides funding for housing, economic development, and other community development activities. In fiscal year 2006, Congress appropriated about $4.2 billion for the program. Administered by the Department of Housing and Urban Development (HUD), the CDBG program provides funding to metropolitan cities and urban counties, known as entitlement communities, and to states for distribution to nonentitlement communities. This report discusses (1) how recipients use CDBG funds, including the extent to which they comply with spending limits, (2) how HUD monitors recipients' use of CDBG funds, and (3) how HUD holds recipients that have not complied with CDBG program requirements accountable. To address these objectives, we visited 20 recipients, analyzed HUD data, and interviewed HUD staff.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Housing and Urban Development In order to improve HUD's oversight of the CDBG program, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Community Planning and Development to maintain in IDIS the data needed to determine compliance with the statutory limitations on expenditures for public service activities and administration and planning.
Closed – Implemented
In May 2010, HUD reported that it had implemented this recommendation. The agency had rolled out a new application called IDIS Online in the summer of 2009. According to HUD, this new application stores grantee inputs and adjustments to financial summary reports, which show the two spending limit calculations. percentage of funds obligated for public services and administration and planning. A HUD official provided financial summary reports for two grantees that showed the adjustments taken to calculate compliance with the two spending limits for program year 2009.
Department of Housing and Urban Development In order to improve HUD's oversight of the CDBG program, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Community Planning and Development to develop a plan for ensuring the proper mix of skills and abilities and replacing an aging CPD workforce.
Closed – Implemented
In May 2010, HUD reported that it had implemented this recommendation. In September 2006, HUD issued a Succession Management Plan for fiscal years 2006 to 2009. In that plan, HUD identified the types of mission-critical positions that had been found to be vulnerable to retirements in HUD's four major program offices, one of which was CPD. The plan also described several strategies for succession planning, including redeploying employees from non-critical positions to mission-critical positions and closing skill gaps through training and development programs. Further, on March 26, 2010, the HUD Secretary sent out a memorandum on the agency's Targeted Recruitment Strategy for fiscal years 2010-2012. In this document, he described a strategy for addressing HUD's need to identify qualified individuals for its talent pipeline over the next three fiscal years. He stated that this strategy would incorporate the utilization of various programs and authorities to include: Presidential Management Fellows (PMF); the Student Career Experience Program (SCEP); and the Student Temporary Employment Program (STEP).
Department of Housing and Urban Development In order to improve HUD's oversight of the CDBG program, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Community Planning and Development to look for additional opportunities to solicit field staff input on IDIS user requirements.
Closed – Implemented
In May 2010, HUD reported that it had implemented this recommendation. The Office of Community Planning and Development (CPD) released the redesigned system, IDIS Online, for user acceptance testing in the Fall of 2008. According to HUD, field staff were advised to use the system not only as HUD staff but also as if they were grantees. This practice continued for over 9 months until the system was rolled out to the first grantees in the summer of 2009. A HUD official provided a spreadsheet that outlined problems identified during testing. In addition, HUD stated that CPD's Systems Development and Evaluation Division currently conducts a monthly conference call about IDIS Online with all field offices to solicit input and to address any related issues.
Department of Housing and Urban Development In order to improve HUD's oversight of the CDBG program, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Community Planning and Development to consider developing guidance for the CDBG program that details what conditions should be considered when taking corrective actions and what specific conditions warrant different types of corrective actions.
Closed – Implemented
In October 2006, HUD reported that it had examined its guidance relating to corrective actions for monitoring findings and determined that it was an opportune time to update this guidance and examine whether certain flexibility for dealing with monitoring findings remained the appropriate protocol. In response to subsequent follow-up in September 2010, the Office of Community Planning and Development (CPD) indicated that it had considered updating the guidance. Specifically, a CPD representative stated that CPD had considered updating the guidance and still thought it would be beneficial, but competing priorities had forced them to delay any effort to do so. He noted that implementing the Housing and Economic Recovery Act of 2008 and the American Recovery and Reinvestment Act of 2009 had been higher priorities because many of the programs in these two acts were funded through the Community Development Block Grant program account. Due to these competing demands, CPD planned to rely on the current guidance for the immediate future.

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Topics

AccountabilityBlock grantsCommunity developmentCommunity development programsCost controlProgram evaluationCurbs (Road structures)Interorganizational relationsSanctionsExpenditure of funds