Orange County, Calif., PHA Didn’t Always Ensure That Housing Units Met HQS

OIG audited the Orange County Housing Authority’s Housing Choice Voucher program’s housing quality standards (HQS) primarily due to the Orange County district attorney’s investigation into allegations that PHA inspectors conducted personal business during the work day. These allegations resulted in concerns that inspections may not have been thorough to ensure housing units met HUD standards. OIG’s objective was to determine whether the PHA conducted its inspections in accordance with HUD rules and requirements.

OIG found that the PHA’s inspections didn’t adequately enforce HUD’s HQS. Of the 80 housing units inspected, 42 were in material noncompliance with HUD standards. For those units, the PHA’s inspectors failed to report 229 deficiencies that existed when they conducted their last inspections. This condition occurred because the inspectors didn’t have current and consistent training to ensure that units complied with HQS. In addition, it didn’t have a complete quality control review process in place to ensure inspections of units met HUD standards.

As a result, some tenants lived in housing that wasn’t up to HUD standards, and the PHA disbursed $217,916 in housing assistance payments for these 42 units. Unless the PHA provides training to its inspectors and ensures that all of its units materially meet minimum HQS, OIG estimated that over the next year, HUD will pay more than $48.6 million in housing assistance for units that are materially noncompliant with HUD standards.

OIG recommended that the Director of HUD’s Los Angeles Office of Public Housing require the PHA to: (1) reimburse its program $217,916 from non-federal funds for the 42 units that materially failed to meet HUD standards; (2) certify that the identified deficiencies have been corrected for the units cited; (3) ensure that its inspectors are provided up-to-date and consistent training on conducting inspections, which will prevent more than $48.6 million in program funds from being spent on housing that doesn’t meet HUD standards over the next year; and (4) develop and implement quality controls, which ensure that housing complies with HUD standards.

• HUD Audit: 2016-LA-1003, April 2016