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HUD’s Office of Inspector General Highlights Management Challenges

The U.S. Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) has issued its Fiscal Year 2024 priority open recommendations report to HUD Secretary Marcia L. Fudge.

The report highlights for HUD leadership 35 open recommendations from OIG reports that, if implemented, will help HUD address its most serious management challenges and enhance critical aspects of its operations.

The report also outlines important actions that HUD can take to address recommendations related to: promoting health and safety in HUD-assisted housing, managing fraud risk, and improper payments, improving information technology modernization and cybersecurity, protecting whistleblowers, and mitigating counterparty risk.

Of the 35 priority open recommendations, 24 recommendations were identified in Fiscal Year 2023, and 11 new recommendations were added for Fiscal Year 2024. Each priority open recommendation is an opportunity for HUD to take specific action to increase the integrity of its operations and programs.

In response to HUD OIG’s Priority Open Recommendations report for FY23, HUD took action to close seven significant recommendations, including:

  • Improving Public and Indian Housing’s (PIH’s)oversight of Public Housing Authorities (PHAs’) compliance with the Lead Safe Housing Rule by clarifying what is required when a PHA determines target housing is exempt from the Rule, and updating guidance to PIH staff to help determine whether a child under six years of age resides in an exempted development and what actions should be taken to protect those children;
  • Issuing a HUD-wide directive that requires approval by the Office of the Chief Information Officer for HUD’s web applications and services;
  • Allowing private flood insurance and developing a control to detect HUD-insured loans that do not maintain required flood insurance;
  • Establishing and implementing a plan for unused and unfunded vouchers under the Housing Choice Voucher Program, including through using a landlord taskforce and listening sessions, issuing guidance to PHAs on optimizing budget and utilization, and developing research on the best methods for adjusting fair market rents;
  • Creating and implementing a knowledge management strategy to address the loss of knowledge at HUD caused by attrition; and
  • Updating policies and procedures for tracking expenditures related to slow-spending disaster recovery grantees, including steps for assisting the grantees to expedite spending, identifying the reasons for the delays with the grant, and documenting the outcome of its efforts.

“Our priority open recommendations report offers a roadmap for HUD leadership on specific actions they can take to address discrete challenges that will have the greatest positive impact on the Department’s mission,” said HUD Inspector General Rae Oliver Davis. “By focusing its efforts on these recommendations, HUD will be better positioned to protect whistleblowers, improve how Ginnie Mae handles troubled mortgage-backed security issuers, address systemic challenges with improper payments, and address recommendations that would put billions of taxpayer dollars to better use.”

The 35 priority open recommendations are featured on HUD OIG’s Open Recommendation Dashboard, which also provides information about HUD’s progress in addressing the recommendations.

About Author: Eric C. Peck

Eric C. Peck has 20-plus years’ experience covering the mortgage industry, he most recently served as Editor-in-Chief for The Mortgage Press and National Mortgage Professional Magazine. Peck graduated from the New York Institute of Technology where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books and has served as Copy Editor for Entrepreneur.com.

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