Rep. Tim Moore Questions HUD Official on Audit of Improper Payments and Disaster Recovery Funds

Hurricane Impact and Federal Response

• 🌪️ Hurricane Helen caused an estimated $80 billion in damage in North Carolina, with families and businesses losing significant assets.
• 🏠 Approximately $15 billion is estimated to be needed for housing assistance and recovery alone.
• 📉 The federal response prior to the current year, particularly from HUD, was perceived as lacking, leaving many unsure of available resources and facing potential loss of temporary housing.
• ✅ The situation has significantly improved under the new administration, though it is not yet perfect.

HUD's Community Development Block Grant Disaster Recovery Program

• 💰 The Community Development Block Grant Disaster Recovery (CDBG-DR) program is critical for long-term recovery efforts.
• ❓ A lack of transparency in HUD's formula for determining CDBG-DR allocations raises questions about potential vulnerabilities to fraud or abuse.
• 📊 The Inspector General's office has not yet examined the allocation process itself as a contributor to fraud, waste, and abuse.

Audit into Improper Payments

• 🔍 An audit was launched in January 2024 to determine if four CDBG-DR grantees made improper payments.
• 💸 Grantees had budgeted over $94 million and spent nearly $356 million on completed and underway match activities.
• ⚠️ The concern stems from HUD not requiring grantees to report or track how they use match funds, leading to instances where grantees use both FEMA and HUD funding beyond the required match, potentially wasting HUD funds.
• 📊 The audit aims to identify and remedy payments above the match cap.

Audit Status and Next Steps

• 📝 The Inspector General's office is in the process of issuing a report on the audit, expected in the coming months.
• 📢 An interim report was issued to flag the lack of tracking for immediate action by HUD.
• ⏳ A further report on the review will be issued soon.