Federal Reports

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What We Looked AtWe reviewed the State of Nebraska's single audit report for the fiscal year ending June 30, 2017, in order to identify findings that affect directly awarded Department of Transportation programs. An independent auditor prepared the single audit report, dated March 19, 2018.What We FoundWe found that the report contained a subrecipient monitoring finding that needs prompt action from the Federal Transit Administration's (FTA) management.RecommendationsWe recommend that FTA ensures that State complies with the subrecipient monitoring requirements. We also recommend that FTA recovers $99,226 from the State, if applicable.

The Fort Peck Assiniboine and Sioux Tribes (known collectively as the Fort Peck Tribes) are federally recognized Native American tribes located in Montana. For Federal fiscal years (FYs) 2011 through 2015, the Fort Peck Tribes did not administer $436,765 of Low-Income Home Energy Assistance Program (LIHEAP) grant funds in compliance with Federal laws, regulations, and guidance. These errors occurred because the Fort Peck Tribes did not have policies and procedures or other internal controls in place to prevent the errors. The improperly administered LIHEAP grant funds could have been used to provide eligible households additional benefits, or the Fort Peck Tribes could have used them for other purposes such as crisis situations, residential weatherization, or energy-related home repairs.

What We Looked AtWe performed a quality control review (QCR) on the single audit that Macias Gini O'Connell LLP (MGO) performed for the Riverside County Transportation Commission's (Commission) fiscal year that ended June 30, 2017. During this period, the Commission expended approximately $438 million from the U.S. Department of Transportation's (DOT) grant programs. MGO determined that DOT's major programs were the Transportation Infrastructure Finance and Innovation Act program and the High-Speed Rail Corridors and Intercity Passenger Rail Service Capital Assistance program.Our QCR objectives were to determine whether (1) the audit work complied with the Single Audit Act of 1984, as amended, the Office of Management and Budget's Uniform Guidance, and the extent to which we could rely on the auditors' work on DOT's major programs; and (2) the Commission's reporting package complied with the reporting requirements of the Uniform Guidance.What We FoundMGO's audit work complied with the requirements of the Single Audit Act, the Uniform Guidance, and DOT's major programs. In addition, we found nothing to indicate that MGO's opinion on each of DOT's major programs was inappropriate or unreliable. However, we identified deficiencies in the Commission's reporting package that required correction and resubmission.

In violation of the housing assistance payment contract’s conflict-of-interest requirements, the former executive director of the Housing Authority of the City of Beeville, TX, executed housing assistance payment contracts on behalf of the Authority with her brother and sister. The former executive director did not fully disclose the conflicts-of-interest and had not sought a waiver from HUD’s Office of Public and Indian Housing until the OIG’s review occurred. As a result, both siblings received housing assistance payments as landlords, and the Authority paid them $31,555 for ineligible housing assistance payments.On June 21, 2018, the Office of Program Enforcement executed a settlement agreement showing that HUD had filed a complaint against the former executive director and her siblings under the Program Fraud Civil Remedies Act of 1986, for causing false claims to be made in HUD’s Housing Choice Voucher Program. The respondents agreed to pay HUD $40,000 to settle the false claim allegations. The agreement required an initial payment of $13,320, 53 monthly payments of $500, and a final payment of $180. The settlement was not an admission of liability or fault on the part of any parties.

This report presents the results of our self-initiated audit of Local Purchases and Payments – Otisville, MI, Main Post Office. The Otisville Post Office is located in the Detroit District of the Great Lakes Area. This audit was designed to provide U.S. Postal Service management with timely information on potential financial control risks at Postal Service locations. Our objective was to determine whether local purchases and payments were valid and properly supported at the Otisville, MI, Main Post Office.

The VA Office of Inspector General (OIG) conducted a national review to determine whether Veterans Benefits Administration (VBA) staff assigned correct effective dates on claims for compensation benefits with an intent to file (ITF). The ITF allows claimants the opportunity to provide minimal information related to the benefit sought and gives them up to one year to submit a complete claim. The submission date of an ITF is important because VA may use the date of receipt as an earlier effective date for paying benefits. The OIG found that VBA staff did not always assign correct effective dates for compensation benefits with ITF submissions from March 24, 2015, to September 30, 2017, resulting in $72.5 million in improper payments. Most of the errors occurred during the initial period of ITF implementation, and the OIG found that 43 percent of cases were assigned incorrect effective dates. This was largely due to a lack of standard operating procedures, inadequate procedural guidance for electronic ITF submissions, deficient and delayed training, and a lack of functionality in the Veterans Benefits Management System (VBMS). VBA has since reduced the number of incorrectly dated claims to 4 percent. The OIG recommended that the Under Secretary for Benefits prioritize the modernization of the ITF system and consider integrating ITF submissions into the VBMS. The OIG also recommended a special review of veterans’ claims with ITFs submitted during the troubled period.