Federal Reports

Under the Lead Safe Housing Rule (LSHR), owners of multifamily properties receiving assistance from the U.S. Department of Housing and Urban Development (HUD) must comply with specific requirements following reports that a child under the age of 6 residing in an assisted unit has a confirmed elevated blood lead level (EBLL).  Some of these requirements are (1) ensuring that an environmental investigation is conducted to determine the source of the lead poisoning, (2) timely remediating or abating the source of the lead poisoning, if applicable, and (3) notifying both the Office of Multifamily Housing Programs (Multifamily) and the Office of Lead Hazard Control and Healthy Homes (OLHCHH) throughout the process.  HUD requires owners to report EBLL response information to both HUD Field Offices and OLHCHH because such information must be received timely to ensure efficient and effective program administration and to monitor whether the owner has taken timely and appropriate steps to protect children who live in HUD-assisted multifamily housing.

We found that Multifamily lacks policies and processes to effectively ensure that property owners are managing reported EBLLs and are taking appropriate and timely steps to investigate and mitigate lead hazards.  First, Multifamily has no internal policy specifying how staff should oversee property owners’ compliance with LSHR requirements following a potential or confirmed EBLL.  Additionally, Multifamily’s property management information system, the Integrated Real Estate Management System (iREMS), is used to document digital files and interactions with property owners but was not designed to track reported EBLLs or property owners’ actions to mitigate lead hazards.  HUD has received only two reports of EBLLs from multifamily property owners during fiscal years 2019 to 2024, and information on those reports in iREMS was either nonexistent or limited in nature.

To improve its oversight of owners’ responsibilities under the LSHR, Multifamily should (1) develop and implement a policy that clearly defines its staff’s roles and responsibilities for EBLL-related requirements and (2) establish a process to track reported EBLLs as well as actions required of property owners to mitigate lead hazards.  Without implementing these measures, HUD will not have assurance that property owners who have children with EBLLs residing in their properties are taking timely and appropriate steps to protect residents from continued exposure to lead hazards.

We provided HUD with two recommendations to ensure HUD’s compliance with the LSHR’s specific requirements following reports that a child under the age of 6 residing in an assisted unit has a confirmed EBLL.  

The Fiduciary Program within the Veterans Benefits Administration (VBA) was established to protect beneficiaries who are unable to manage their VA benefits by appointing and overseeing fiduciaries—individuals or legal entities charged with stewarding the funds on behalf of beneficiaries for their well-being. VA-appointed fiduciaries can be removed and barred from future service if they are found to have misused or misappropriated benefits, been convicted of a qualifying felony offense, or knowingly violated or refused to comply with VA regulations. Staff are required to flag these barred fiduciaries in VBA’s electronic system to prevent a reappointment. The OIG conducted this review to determine whether VBA’s oversight ensures individuals and entities barred from serving as a VA fiduciary are identified and flagged.

When fiduciaries were removed for a reason that would constitute a bar to future service, the OIG found that staff did not flag them in 88 of 129 sampled cases, or 68 percent of the time. This occurred because the Fiduciary Program Manual lacked clear procedures about when the flag should be placed and by whom. Unclear guidance in the manual also led to inadequate staff training and insufficient oversight. Training did not address use of the flag or its purpose in protecting vulnerable beneficiaries, and checklists used for the quality assurance process had no specific questions or error descriptions to confirm the flag was properly applied.

Failure to properly flag barred fiduciaries increases the risk that they will be reappointed. The OIG made three recommendations to the under secretary for benefits, including updating the program’s manual to specify when a removed fiduciary should be flagged, developing and providing training about updated manual procedures regarding flagging, and updating the quality review process.

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements.

During this semiannual reporting period, the National Endowment for the Arts (NEA) Office of Inspector General (OIG) completed the Congressionally mandated NEA financial statement audit for fiscal year (FY) 2024, and a performance audit of the Georgia Council for the Arts. We also collaborated with the NEA on the follow-up process required by the Office of Management and Budget, leading to corrective actions on eight OIG recommendations by the NEA and awardees during this period. Additionally, we resolved all hotline complaints received during the semiannual reporting period.

I applaud the NEA and the OIG staff for continuing to press forward and effectively work together to deliver our respective missions in a high-quality manner. The value-added work that the NEA and OIG accomplished this period is due to their commitment, leadership, and effectiveness; while helping to ensure integrity, excellence, and value in the delivery of NEA’s mission.