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The Department of Housing and Urban Development (HUD), through the Federal Housing Administration (FHA), insures billions of dollars in home mortgage loans made by private lenders. HUD's 2020 Management Reform Plan, issued in 1997, sought to downsize and reform the agency, including its single-family mortgage insurance program. As part of its 2020 plan, HUD consolidated the single-family program's field activities at four new regional homeownership centers and specified resources for the centers. Although HUD has substantially streamlined FHA's single-family mortgage insurance programs, human capital issues remain a concern. This report reviews HUD's implementation of the homeownership center concept under the 2020 plan, focusing on (1) the deployment of center staff, (2) the training provided to the center staff, and (3) the centers' monitoring of contractors. GAO found that nearly half of the centers' staff remain in 71 field offices across the country, even though HUD envisioned that only a third of the staff would stay in the field offices. The deployment of staff across the centers is not consistent with their workload, and, as a result, the centers are having trouble supervising and making effective use of staff. GAO also found that HUD has not developed a standardized training curriculum for center staff. The centers have had difficulty using their training funds effectively because HUD provided them late in the fiscal year and then pulled back some funds before they could be used. Finally, increased responsibilities and staff shortage have caused the centers to expand their use of contractors. However, the centers' ability to monitor contractors has not kept pace with their growing reliance on them.

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Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Housing and Urban Development To address the human capital challenges facing HUD's homeownership centers, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Housing-Federal Housing Commissioner to assess the deployment of the centers' workforce in light of current organizational needs, develop a plan for locating center staff where they are needed, and deploy the staff accordingly.
Closed - Implemented
In July 2004, HUD's Office of Single Family Housing, in conjunction with the four homeownership centers, developed a homeownership center staffing plan for the next three to five years based on center responsibilities and loan origination volume. According to the plan, single-family insurance endorsements and property acquisitions were the primary drivers for determining the homeownership center staffing levels. The target staffing configuration places the majority of the staff in the homeownership centers, as was originally envisioned, and a small number of staff in the field. According to the plan, this shifting of staff places more individuals in the homeownership center locations where the greater workload exists. The plan will be used to place staff where needed when outstationed staff leave the Office of Single Family Housing and will be updated as changes occur in resource needs and availability, Departmental goals and priorities, and workload.
Department of Housing and Urban Development To address the human capital challenges facing HUD's homeownership centers, the Secretary of Housing and Urban Development should Direct the Assistant Secretary for Housing-Federal Housing Commissioner to develop a training curriculum for center staff that ensures that available training funds are allocated and used to develop the skills that the staff need to perform their responsibilities.
Closed - Implemented
In October 2001, HUD reported that its Office of Single Family Housing was working with the HUD Training Academy and the homeownership centers to develop a formal training curriculum that would be used to ensure that center staff have the skills they need to adequately handle their assigned responsibilities, including responsibilities related to contractor oversight. The centers were in the process of identifying the core skill requirements for positions in each of the functional program areas in the centers. The HUD Training Academy and the Office of Housing were also working together to identify resources to meet employee training needs. In June 2002, HUD reported that the Office of Single Family Housing had formed a task force comprised of headquarters and center staff. This task force identified (1) the core competencies for each of the major single-family position titles, and (2) the types of courses and the learning objectives that would meet each of the identified core competencies. Using the task force's information, HUD's Training Academy developed a competency model for single-family housing specialists, one of the major single-family positions. The model, completed in March 2002, describes the knowledge, skills, abilities, and/or other characteristics required for job performance. In May 2002, the Training Academy completed a curriculum development plan for single-family housing specialists, which recommends training designed to develop high-priority competencies. According to HUD, the plan will help ensure that training funds are used to further develop the skills that staff need to perform their responsibilities.
Department of Housing and Urban Development To address the human capital challenges facing HUD's homeownership centers, the Secretary of Housing and Urban Development should direct the Assistant Secretary for Housing-Federal Housing Commissioner to use tools, such as GAO's human capital self-assessment checklist, to develop a strategic human capital management plan for the homeownership centers that considers all areas of human capital management, including size of the workforce, workforce deployment, training, and oversight of contractors.
Closed - Implemented
FHA has taken a number of actions in response to this recommendation. First, it developed a Workforce Analysis and Management System that (1) creates a workforce plan that determines what resources are needed to meet strategic goals and (2) allows FHA to identify gaps or priorities in its workforce. According to FHA officials, the agency used both our human capital checklist and the processes that we used to develop our workforce plan as guides when developing the system. Second, FHA used data from this workforce analysis system to determine skill gaps and training needed to address these gaps. It then targeted its training money to address the skill gaps identified. Third, HUD implemented a Resource Estimation and Allocation Process to determine proper staffing levels within FHA's Office of Single Family Housing. The results will be used along with the workforce planning process to develop a succession plan and determine staffing needs at the homeownership centers. FHA has developed a format that will allow the agency to use data from this process to determine where workforce gaps will occur and whether the gaps can be filled by deployment of existing staff or by recruitment. Finally, FHA took steps to improve its oversight of contractors, including completing a detailed assessment of business risks associated with its contractors that sell HUD properties.

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