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Exhibit 1.

Review of Contract Compliance – Broward County Minority Builders Coalition (MBC)

March 6, 2012 Report No. 12-06

Office of the County Auditor Evan A. Lukic, CPA

County Auditor

Compliance Review

Office of the County Auditor 1

Table of Contents

Topic Page

Executive Summary ............................................................... 2

Purpose and Scope ................................................................ 4

Methodology ........................................................................... 4

Background ............................................................................ 4

Findings and Recommendations .......................................... 8

APPENDIX A ......................................................................... 19

APPENDIX B ......................................................................... 21

APPENDIX C ......................................................................... 25

Compliance Review


Executive Summary

This report presents the results of our review of the County’s agreements with Broward County Minority Builders Coalition (MBC). This review was initiated at the request of the Board of County Commissioners (Board). The objectives of our review were to evaluate MBC’s compliance with their County contracts and the effectiveness of contract administration by the Housing Finance and Community Development Division (Division). We reviewed a sample of 30 home repair clients funded by the State Housing Initiative Partnership (SHIP) Program during the period between September 2009 and August 2011, with costs totaling approximately $978,000. Our review disclosed the following issues:

1. MBC and Division practices were inadequate to ensure projects were completed economically and timely, while meeting quality and client satisfaction standards.

2. MBC was noncompliant with key contractual requirements.

3. The Division did not comply with internal procedures and key Local Housing Assistance Plan (LHAP) provisions.

4. Broward County may be subsidizing the administrative costs for the City of Coral Springs and the Town of Davie.

We also performed a follow-up review of contract administration and performance findings and recommendations related to MBC cited by the Broward County Office of Internal Audit in their report - “Financial and Compliance Review of the Housing Finance Authority and Office of Housing Finance” dated March 10, 2003. The specifics of each finding and recommendation from the report are detailed at Appendix C. Based on our review little sustained progress has been made in addressing the findings identified in the prior report notwithstanding management’s representations of corrective actions taken. In light of management’s failure to adequately address significant contract administration and contractor performance issues identified in this and the previous report, it is recommended the Board direct the County Administrator to actively monitor and periodically report to the Board on progress in establishing management control over the SHIP program.

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Recommendations We recommend the Board of County Commissioners direct the County Administrator to immediately:

1. Enforce compliance with the existing contract and LHAP requirements regarding

project costs.

2. Ensure projects are completed within 120 days of permit issuance as required by the NTP or develop and track an alternative timeliness performance measure.

3. Require MBC to submit monthly reports to the Division, as required, including an

assessment of each project’s status in meeting timeliness goals.

4. Ensure final walkthrough inspections are properly conducted and documented, including accurately completing forms containing signatures of all parties.

5. Ensure interim inspections are properly conducted and documented.

6. Ensure subcontractor performance evaluations are completed in accordance with the Purchasing Director’s memorandum dated December 2010 and considered in future awards.

7. Develop a comprehensive customer satisfaction survey instrument to evaluate MBC, the Division and subcontractor performance at the conclusion of each project.

8. Require the Division to distribute, collect and process the survey to ensure independent and objective results are obtained.

9. Discontinue the current practice of paying subcontractors directly and instead issue joint checks payable to MBC and the subcontractors, if MBC is incapable of paying its subcontractors timely.

10. Monitor, evaluate and document MBC’s performance and take appropriate actions to address noted performance deficiencies timely.

11. Ensure MBC’s performance is appropriately considered in connection with any future awards.

12. Establish management control over the home repair program through

enforcement of existing LHAP requirements and internal procedures and report progress of these efforts to the Board no later than September 30, 2012.

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13. Prepare an analysis of actual costs and fees collected for administering the cities’ grant funds and report the results to the Board by December 31, 2012.

Purpose and Scope This review was initiated at the request of the Board. The objectives of our review were to evaluate MBC’s compliance with the County’s agreements and the effectiveness of contract administration by the Division. We also performed limited follow-up on issues cited in a report issued by the Office of Internal Audit dated March 10, 2003. The review covered home repair services provided by MBC between September 2009 0F0F

1 and August 2011 pursuant to contracts with Broward County dated July 11, 2008 and September 16, 2009.

Methodology To accomplish our objectives, we:

Reviewed: o A sample of 30 SHIP home repair client files with repair costs totaling

approximately $978,000 incurred between September 2009 and August 2011, o MBC contracts dated July 11, 2008 and September 16, 2009 (and all

amendments) for $2.2 and $2.4 million, respectively, o Local Housing Assistance Plans (LHAP) for Broward County, Town of Davie

and the City of Coral Springs, o The 2008 SHIP Program manual as published by the Florida Housing

Finance Corporation, o Client eligibility procedures developed by the Division, and o The Office of Internal Audit, Financial and Compliance Review of the Housing

Finance Authority and Office of Housing Finance, dated March 10, 2003.

Interviewed Division and MBC staff

Background In July 1992, the Florida Legislature enacted the William E. Sadowski Affordable Housing Act, to provide funding to local governments to create and preserve affordable housing. The SHIP grant program is one of the housing programs funded under the 1 SHIP grants must be encumbered within the first 12 months and expended within the subsequent 24 months;

therefore some repairs included in our sample were funded by grant year July 2007 to June 2008.

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Housing Act. Chapter 420, Part VII, of the Florida Statutes, created the SHIP grant program to provide funding as an incentive to create local housing partnerships, to expand and preserve affordable housing. The SHIP program funds home repairs for very low, low and moderate income homeowners. The Florida Housing Finance Corporation administers the SHIP program for the State of Florida and allocates funding to eligible counties and cities on a population based formula. During the period July 2007 to June 30 2010, the County received SHIP grant awards totaling approximately $4.8 million. Home Repair Services under the SHIP Program Home repair is one of several allowable uses of SHIP funds. This includes:

Repairs or replacement of roofs, air conditioning system, windows and doors,

Repairs to nonconforming structures built without an approved permit, and

Emergency repairs to address threats to life, health and safety issues. To be eligible to receive SHIP program funds, counties and eligible municipalities are required to develop and adopt a Local Housing Assistance Plan (LHAP), which describes the types of housing assistance to be provided, the maximum funding to be distributed for each recipient and the estimated number of households to be served. SHIP guidelines permit local governments to provide assistance in the form of deferred payment loans and provide for repayment of funds if the homeowner receiving assistance ceases to occupy the unit. Broward County’s SHIP Program The Florida Housing Finance Corporation allocates SHIP funding to Broward County and requires establishment of a LHAP. The County’s LHAP was first adopted in1996 and specifies the types of assistance 1F1F

2 available to County residents. The County’s LHAP also details the maximum award amounts for each type of housing assistance, the terms of the awards and the selection criteria used to determine client eligibility. The Housing Finance and Community Development Division is the County agency responsible for administration of SHIP programs funds and determining client eligibility. The Division also administers the SHIP home repair program for the Town of Davie (Davie) and City of Coral Springs (Coral Springs). Through Interlocal Agreements 2F2F

3 with the County, both municipalities participate in a joint local housing program, which authorizes the County to administer their SHIP program. During the period July 2007 to June 30 2010, the County received SHIP grant awards totaling approximately $3.1 million and $0.7 million for Coral Springs and Davie, respectively. Both municipalities have also established a joint LHAP with the County, which governs the administration

2 Broward County’s LHAP provides for various types of housing assistance, also termed housing strategies which

includes residential rehabilitation and emergency repairs, special needs/barrier free housing repairs, disaster relief

repairs, home purchase assistance, and construction of new homes. 3 The County’s current interlocal agreements with Davie and Coral Springs were executed April 13, 2010 and run

concurrently with the distribution of SHIP program funds.

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and use of their SHIP program funds. The joint LHAP outlines the housing assistance programs that are available to residents, maximum award amounts, terms of the awards, and selection criteria for eligible homeowners. Client Eligibility Process The 2008 SHIP Program Manual provides guidelines to local governments to select eligible recipients for repair services. The manual also outlines the items that must be included in the application for assistance, including the following:

Applicant’s household (name, age, and relationship to applicant)

Employment information, and

Household income.

Funding is provided to eligible home owners on a first come, first qualified basis. To begin the eligibility process, homeowners contact the Division and complete an application. The LHAP requires applicants to own and occupy the property in either unincorporated Broward County 3F3F

4 or the two municipalities discussed earlier. In addition to the requirements outlined in the SHIP program manual and LHAP, as noted previously, procedures established by the Division requires applicants to provide additional documents to determine eligibility, including:

Copy of Warranty Deed,

Current Mortgage Statements showing proof that mortgages are not delinquent,

Tax Returns and W-2, 1099's covering the past two years or a year-to-date profit and loss statements if self-employed,

Residency card or other immigration documents, and

Proof of full time student status for individuals 18 years or older. Upon receipt of the completed application and required documentation, Division staff meets with the applicant to review documentation. The eligibility process becomes final after the Division confirms the household income and the applicant attends a mandatory counseling workshop and receives a certificate of eligibility. After clients are certified for services, they are placed on a waiting list 4F4F

5 until funding becomes available. Once funding is available, clients are referred to MBC to begin home repairs. Maximum Repair Amounts and Terms of Award Assistance Table 1 on the next page lists the maximum assessed home values, funding caps and mortgage terms for Broward County, Davie and Coral Springs.

4 SHIP funding for Broward County also includes allocation for cities that do not qualify to receive their own SHIP

funds. 5 During the period reviewed, Division staff advised that when SHIP funding was not available, some clients were

placed on waiting lists prior to referral to MBC.

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Table 1 Broward County, Davie and Coral Springs

Maximum assessed home values, repair maximums and mortgage terms

Jurisdiction

Maximum Assessed Value (Note 1)

Maximum Repair Amounts

Mortgage Term

Broward County $429,619 $40,000 10 years

Coral Springs $331,579 $35,000 5 years

Town of Davie $280,462 $40,000 5 years Source: LHAPs for Broward County, Town of Davie and City of Coral Springs Note 1: According to the County’s Property Appraisers records

Applicants that receive repair services are required to sign a deferred mortgage and promissory note at zero percent interest rate. The executed mortgage and promissory note are forwarded by MBC to the County, to be recorded in the public records. The mortgages provide for automatic partial reductions5F5F

6 on each anniversary date provided the homeowner continues to reside on the premises. However, if the property is sold or transferred during the term of the mortgage, the LHAP requires full repayment of the repair cost incurred under the County program or pro-rated repayment of repairs costs incurred under the Davie or Coral Springs programs. Broward County Minority Builders Coalition (MBC) Since 1994 the County has contracted with MBC to provide home repair services under the SHIP program. Most recently, in 2009, MBC was selected through a Request for Proposal process and awarded a contract for $2.4 million.6F6F

7 Under the contract, MBC manages construction repairs and is paid 18% of the cost of repairs as an administrative fee. MBC’s contractual obligations include:

Development of repair specifications and scope of work for properties of applicants approved by the County,

Solicitation of quotations from subcontractors,

Awarding repair and renovation agreements to subcontractors,

Preparation of the construction Notice to Proceed for County approval, and

Inspection of work performed by subcontractors. There are two key phases of the home repair process involving both MBC and Division staff, the planning and execution phases.

6 Mortgages for homeowners funded by Davie and Coral Springs provided for a 20% reduction each year for five

years while mortgages for recipients funded by Broward County provided for a 10% reduction each year for ten

years. 7 Contract was amended on June 29, 2010 and later on June 28, 2011 and expires June 30, 2012.

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Planning Phase: This phase involves an initial joint visit by Division and MBC staff to the client’s home, to document the repairs to be completed and develop the repair specifications and scope of work. After the Division staff reviews and approves the repair specifications, MBC advertises to solicit sealed quotations from prequalified subcontractors. MBC then selects the lowest responsive bid and prepares a repair agreement with the selected subcontractor for the award amount plus an 18% administrative fee. A Notice to Proceed (NTP) is prepared by MBC and sent to the Division for approval. Execution Phase: During this phase the NTP is reviewed and approved by Division staff and returned to MBC to begin repairs. The NTP requires work to be completed within 120 days after the receipt of required permits. When home repairs are complete, an inspector from the Division, MBC staff, the subcontractor and home owner, perform a final inspection of the repairs and complete a walkthrough form. Subsequently, the subcontractor provides MBC an invoice for the repair costs and MBC prepares an invoice to the County, which includes the subcontractors’ costs plus the 18% administrative fee.

Findings and Recommendations We reviewed a sample of 30 SHIP home repair client files with repair costs totaling approximately $978,000:

13 Clients with repairs totaling $404,000 funded by Broward County’s LHAP,

12 Clients with repairs totaling $393,000 funded by Coral Springs’ LHAP, and

5 Clients with repairs totaling $180,000 funded by Davie’s LHAP. Finding 1 MBC and Division practices were inadequate to ensure projects were completed economically and timely, while meeting quality and client satisfaction standards Our review identified the following deficiencies:

Phase 1- Planning

Perform initial home inspection to document

repairs

Develop repair specifications with scopes of work

Obtain County approval of repair specifications

Solicit quotations from subcontractors

Select and award subcontracts

Prepare Notice to Proceed (NTP)

Phase 2- Execution

County approves NTP

Subcontractor requests permits to begin repairs

Subcontractor complete repairs

Perform final walk through inspection

Submit invoice to County for payment

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Repair costs exceeded initial budgets for 20% of the projects in our sample due to noncompliance with existing cost control measures;

More than half of the projects in our sample were not completed within 120 days as required by the NTP and MBC did not track project timeliness as required;

Monitoring and evaluation activities were insufficient to ensure project quality objectives were met; and

Project close-out processes were inadequate to ensure completed projects satisfactorily met customer’s needs and expectations.

Construction industry literature identifies best practices to ensure successful project completion. Construction Management generally refers to the professional management practice applied to construction projects from project inception to completion. Construction Management activities aim to control the construction project’s cost, time, scope and quality, and to enhance the probability of a project’s successful outcome. According to the Construction Management Association of America, the most common responsibilities of a Construction Manager 7F7F

8 fall into the following seven categories: project management planning, cost management, time management, quality management, contract administration, safety management, and Construction Manager professional practice. To evaluate a construction project’s efficiency and effectiveness, the industry typically uses the following four key performance indicators:

Controlling construction costs,

Attaining project timeliness,

Ensuring quality construction work, and

Meeting customer needs Although current practices contain elements of sound Construction Management principles, several key deficiencies hinder successful project completion. Noncompliance with current cost control measures resulted in project cost overruns. In light of recent budget cuts and restrictions, it becomes especially crucial to spend grant funds as economically as possible. Ensuring that repairs are done as economically as possible is an important project management function. A review of construction management literature shows that cost predictability is a valuable performance measure. Specifically, the construction manager typically determines whether projects are completed “within budget” by comparing a project’s final cost to its initial budget.

8 In the context of this report, “Construction Manager” is synonymous with “Contract Administrator,” which refers

to both the Division and MBC as the Division contracts with MBC while MBC contracts with vendors to perform

home repair services

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There are two primary mechanisms to control SHIP home repair project costs:

Articles 3.6 and 3.13 of the agreement between the County and MBC requires the County to issue a Notice to Proceed (NTP) prior to project initiation and to approve in advance any charges exceeding the NTP amount. The agreement also specifies that the cost of any work done without prior County approval shall be borne by MBC and not by the County or homeowner.

The current Local Housing Assistance Plan (LHAP) establishes maximum amounts the County will pay for individual home repair projects. Total repair costs per project may not exceed $40,000 for homes funded by Broward County and Davie and $35,000 for homes in Coral Springs.

Our review of 30 client files disclosed six (20%) projects did not comply with the above mentioned requirements. We found repair costs for two projects exceeded the approved NTP amount by $8,960. These costs were not supported by an authorized change order and NTP; they were paid by the County rather than MBC, contrary to the requirements of the agreement. We also found repair costs for four projects exceeded the maximum amounts allowable under the LHAP. The total amount of these repair projects was $78,123 more than the limit established by the LHAP. Table 2 below shows the details.

Table 2 The County paid $78,123 in excess of

maximums allowed by the LHAP.

Jurisdiction Maximum Cost per LHAP Total Repair Costs Difference

Davie (Note 1) $40,000 $45,237 $ 5,237

Coral Springs

35,000 44,722 9,722

35,000 43,260 8,260

Broward 40,000 94,904 54,904

Total Paid in Excess of Limits $78,123

Source: Prepared by County Auditor’s Office based on data developed during the review Note 1: Repair cost includes $5,490 paid by the County to remediate homeowner complaints In addition to being noncompliant with contract and LHAP requirements, overspending on these projects reduced available funding to serve additional clients and could result in the County funding the cost of amounts that exceed the grant maximums. Recommendation We noted instances of noncompliance with two major cost control requirements. Therefore, we recommend the Board of County Commissioners direct the County Administrator to:

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1. Enforce compliance with the existing contract and LHAP requirements regarding

project costs immediately. Significant project delays occurred and neither MBC nor the Division has tracked project timeliness as required. Another key component of Construction Management is ensuring that projects are completed according to planned schedules. Projects should be completed in a timely manner to minimize disruptions to homeowners and prevent further deterioration of the property, which may lead to increased project costs. Although some delays may be expected, it is considered a construction management best practice to monitor project schedules and minimize the impact of these delays whenever possible. It is a common construction industry performance measure to examine the percentage of projects completed “on time.” MBC did not track whether projects were completed “on time” and there are no timeliness goals contained in the agreement between the County and MBC. The only timeliness measure is a requirement in the Notice to Proceed (NTP) that repair projects must be completed within 120 days from the issuance of permits. MBC staff acknowledged they have not tracked this measure, thus MBC is noncompliant with this requirement. We analyzed the number of days from the date the County approved the NTP to the date of the final walkthrough for the 30 clients reviewed. We could not determine whether the construction was completed within 120 days because permit dates were not always available. However, we believe our analysis is a valid proxy measure for the requirement because permit issuance always occurs after NTP approval. We found that 16 (53%) of 30 projects exceeded 120 days from NTP approval to final walkthrough; meaning that at least half of the projects in our sample may have exceeded the NTP requirement, indicating the occurrence of project delays. The completion period for the projects averaged 224 days and ranged from 130 to 422 8F8F

9 days. SHIP grants must be encumbered within the first 12 months and expended within the subsequent 24 months; therefore timelines of repairs are critical to grant compliance. Also, Article 3.15 of the agreement requires MBC to submit monthly progress reports to the Division on the first business day of each month which is another potential method for identifying project delays. These reports are to describe the status of all outstanding work authorized, including the “planned versus actual” progress of individual projects and their related budgets.

9 In addition, for one project the completion period was 860 days. If this project was included, the average would be

increased to 263 days.

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MBC staff acknowledged they have not submitted these required monthly reports; instead, they submitted a quarterly report listing clients served under the grant. We noted the quarterly reports do not include status updates for projects and therefore would not be an effective tool for identifying project delays. Recommendations Although timely completion of projects is a valuable performance measure, MBC does not track timeliness. However, our analysis of a timeliness measure disclosed project delays. To enhance MBC’s ability to track project timeliness and the County’s ability to evaluate MBC’s performance, thus reduce potential delays, we recommend the Board of County Commissioners direct the County Administrator to immediately:

2. Ensure projects are completed within 120 days of permit issuance as required by the NTP or develop and track an alternative timeliness performance measure.

3. Require MBC to submit monthly reports to the Division, as required, including an

assessment of each project’s status in meeting timeliness goals. Current monitoring and evaluation activities are insufficient to ensure project quality objectives are met. Routine and systematic monitoring and periodic evaluation of construction projects are typically performed in the industry to ensure projects meet quality standards. Monitoring refers to the routine, daily assessment of ongoing activities and progress, while evaluation is the periodic assessment of overall achievements. Article 3.14 of the Agreement between the County and MBC states: “the County, within its discretion, will carry out periodic monitoring and evaluation activities. The continuation of this Agreement is dependent upon satisfactory evaluations.” According to Division and MBC staff, current monitoring and evaluation activities consist of:

Division and MBC staff jointly conducting: o Initial site visits to identify needed repairs and develop project

specifications and scope of work, o Final walkthrough visits to ascertain whether the repair work was done to

specifications and to approve final payment for work performed satisfactorily; and

MBC staff conducting interim site visits to monitor progress while the work is being done.

We identified the following deficiencies with current monitoring and evaluation activities:

MBC staff stated that they conducted interim monitoring site visits; however, they did not provide us with documentation showing such inspections took place.

The Division does not conduct interim site visits to monitor progress, except to respond to customer complaints.

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MBC has developed a final walkthrough form that is to be signed by the client as well as Division, MBC and subcontractor representatives; however, we were not provided properly completed forms for 6 (20%) of 30 client files reviewed.

Neither Division nor MBC staff provided requested documentation of evaluations of subcontractor performance. In a memorandum dated December 9, 2010, the Purchasing Director recommended that contract administrators complete a vendor evaluation for contracts valued between $15,000 and $29,999, and required they be done for contracts exceeding $30,000. Division and MBC staff did not submit evidence showing vendor evaluations had been conducted for any of the four repair projects falling within our sample that were completed after issuance of the Purchasing Director’s memo.

Recommendations Successful project completion depends to a great extent upon effective project monitoring and evaluation practices. To improve current project monitoring and evaluation activities, we recommend the Board of County Commissioners direct the County Administrator to immediately ensure:

4. Final walkthrough inspections are properly conducted and documented, including accurately completing forms containing signatures of all parties.

5. Interim inspections are properly conducted and documented.

6. Subcontractor performance evaluations are completed in accordance with the Purchasing Director’s memorandum dated December 2010 and considered in future awards.

Current project close-out processes are inadequate to ensure completed projects meet customer’s needs and expectations. Another key element of a successful project is the extent to which it meets the customer’s needs and expectations. The construction industry typically uses surveys to ascertain customer satisfaction with completed projects. Customer satisfaction surveys generally measure the customer’s perceptions and opinions regarding the contractor’s knowledge, skill level and courteousness, as well as whether the job site met cleanliness and safety expectations, and whether the completed project met functional objectives. Surveys are normally administered as close to the project completion date as possible. The Division performs a customer satisfaction survey on the quality of service received from the Division; however, the survey does not include items relative to MBC and the subcontractors’ performance. During the final walkthrough, as described on the previous page, some subcontractors obtained signatures from clients asserting they were satisfied with the completed project. For example, files for 15 (50%) of 30 clients reviewed contained a vendor form showing client signatures that indicated satisfaction with the job. But, we also found a lack of uniformity in these forms; some asked the

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client to “check” a box if the worker was courteous, others asked the client to “affirm” if the final work site was clean to the client’s satisfaction, and others asked the client to “certify” that the work was completed per contract specifications.9F9F

10 None of the forms in our sample included all of the questions commonly asked in customer satisfaction surveys. Recommendations To ensure customer’s needs and expectations are met to the greatest extent possible, we recommend the Board of County Commissioners direct the County Administrator to:

7. Develop a comprehensive customer satisfaction survey instrument to evaluate MBC, the Division, and subcontractor performances at the conclusion of each project.

8. Require the Division to distribute, collect and process the survey to ensure independent and objective results are obtained.

Finding 2 MBC was noncompliant with key contractual requirements. Since 1994, the County has contracted with MBC to provide SHIP home repair services. This review focused on two contracts with MBC: one contract for approximately $2.2 million approved by the Board in July 2008 and expired June 2011 and later a contract for approximately $2.4 million approved by the Board September 16, 2009, through June 30, 2012. The contracts are bilateral agreements in that both the Division and MBC must fulfill contractual obligations. During our review, we examined the extent to which MBC adhered to its contractual obligations. Specifically, we analyzed whether MBC complied with 13 contract provisions. Contract compliance is a salient contract management tool to maximize financial and operational performance and minimize risk. We found that MBC did not comply with key contractual requirements. Among the key noncompliance issues we identified are:

MBC failed to comply with the subcontractor bid solicitation and award requirements of the contract. Article 3.4.1 of the contract with MBC states “All awards shall be solicited using sealed quotations which shall be requested from a minimum of three (3) pre-qualified contractors for each project.” Our review found MBC solicited quotations from one contractor for three (10%) of the 30 clients sampled. This issue was previously cited in our review dated March 10, 2003. Failure to obtain a minimum of three quotes subverted the competitive process and may have

10

The walkthrough form also certifies that that the items included in the repair specification has been provided.

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resulted in the County paying higher prices. MBC also solicited quotations from subcontractors who were not prequalified and in at least one case awarded a contract to a non- prequalified subcontractor.

Client files did not include the required building permits for some repairs performed by subcontractors. Article 2.5 of the agreement requires MBC to comply with applicable County codes and regulations relating to the work/services to be provided under the agreement. However, we found two (7%) of 30 files did not contain the permits required by Broward County for drain field and septic tank installation and required by Davie for installation of exterior and sliding glass doors. The repairs violated the building codes, potentially subjecting the homeowner to penalties and/or fines.

Late payments to subcontractors. Article 2.5 of the agreement requires MBC to comply with Florida Statutes relating to the work/services to be provided under the agreement. Section 218.735, Florida Statutes, states that when a contractor receives payment from a local governmental entity for labor, services, or materials furnished by subcontractors and suppliers hired by the contractor, the contractor shall remit payment due to those subcontractors and suppliers within 10 days after the contractor's receipt of payment. We found that 8 (26%) of 30 client files reviewed did not meet this timeliness requirement under Florida law. Payments to the 8 contractors were processed an average of 139 days after receipt of the County’s check, potentially impeding subcontractors’ ability to continue to operate.

Untimely filing of financial statements. Article 7.4 of the agreement requires MBC to submit audited financial statements no later than March 31 of each year. 10F10F

11 We found that the 2009 statement was submitted more than nine months late (in January 2011) and the 2010 statement was submitted on February 21, 2012, also more ten months past due. Article 7.7 specifies that failure to submit timely audited financial statements shall result in “suspension of payment” to MBC; however, despite MBC’s noncompliance the Division did not withhold payments.

Appendix A on page 19 provides a summary of additional contract requirements and the extent to which MBC complied with each of them. Recommendations To ensure compliance with contractual and regulatory requirements, we recommend the Board of County Commissioners direct the County Administrator to:

11

90 days after the end of the fiscal year.

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9. Discontinue the current practice of paying subcontractors directly and instead issue joint checks payable to MBC and the subcontractors, if MBC is incapable of paying its subcontractors timely.

10. Monitor, evaluate and document MBC’s performance and take appropriate actions to address noted performance deficiencies timely.

11. Ensure MBC’s performance is appropriately considered in connection with any

future awards. Finding 3 The Division did not comply with internal procedures and key LHAP provisions. As discussed in the Background Section, Housing Finance and Community Development Division staff administers the SHIP home repair program. Pursuant to Chapter 420, Part VII, Florida Statutes, the County established a Local Housing Assistance Program (LHAP) to govern the administration and expenditure of SHIP grant funds. The current LHAP, in effect through June 30, 2012, establishes requirements the Division must meet in order to receive SHIP grant funds. In addition to the LHAP the Division implemented procedures for determining client eligibility. We reviewed the Division’s compliance with internal procedures, the 2008 SHIP program manual, and nine LHAP provisions. Our review found the Division did not comply with internal procedures and key LHAP provisions. Among the deficiencies we found are:

Faulty client eligibility process. As specified in the current LHAP, 2008 SHIP Program Manual, and internal procedures, Division staff conducts assessments to determine client eligibility for SHIP home repair services. Our review found the clients were determined to be income eligible; however, all 30 client files reviewed had insufficient evidence of required documentation including:

Current/delinquent status of home mortgages,

Citizenship/immigration status of each household member,

IRS documents such as tax returns, W-2’s, 1099’s, and profit and loss statements,

Certificate showing client completion of counseling workshop,

Proof of owner occupancy. Without adequate documentation for these requirements the Division is in violation of the LHAP, Program Manual and the procedures.

Flawed mortgage and promissory note documentation. The current LHAP also specifies how mortgages and promissory notes are to be written. We found that all 30 client files reviewed either had erroneous and/or missing documentation related to mortgages and promissory notes including:

o Mortgages and promissory notes that did not include all cost of repairs,

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o Inaccurately stated property sale and title transfer provisions, o Failure to include joint owner signatures, and o Erroneously stated mortgage terms.

In addition to being noncompliant with LHAP requirements, some deficiencies reduce the payoff amount in the event of a sale or title change during the term of the mortgage. Failure to comply with LHAP requirements violates the terms of the SHIP grant and may subject the County to payback funds to the State of Florida.

Untimely recording of mortgages and promissory notes. To protect the County’s interests, the lien and claim against the property should be recorded in Broward County Public Records as soon as the mortgage and promissory note is executed. We found extensive recording delays for the 30 files we reviewed. For example, it took the Division an average of 229 days from the date the mortgages and promissory notes were executed until the date they were officially recorded. Public recording for nine (30%) of the 30 mortgages ranged from 301 to 476 days. Failure to timely record these documents may result in inadvertent property sale and transfer of title hindering the County’s ability to recover repair costs.

Appendix B on page 21 provides a summary of additional procedures and LHAP requirements and the extent to which the Division complied with each of them. Recommendation To ensure compliance with internal procedures, and LHAP requirements, we recommend the Board of County Commissioners direct the County Administrator to:

12. Establish management control over the home repair program through enforcement of existing LHAP requirements and internal procedures and report progress of these efforts to the Board no later than September 30, 2012.

Finding 4 Broward County may be subsidizing participating municipalities’ administrative costs On April 30, 2010 the Town of Davie and City of Coral Springs entered into inter-local agreements (ILA) with the County to provide SHIP home repair services to eligible residents. Under the terms of the ILA the County receives the SHIP administrative cost as a fee to administer SHIP grant funds. The municipalities’ LHAPs for fiscal years 2008 through 2010 projected administrative costs totaling $287,958 (see Table 3 on the next page).

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Table 3 The County will receive $287,958 to administer

Davie and Coral Springs’ SHIP funds for the five year period ending June 30, 2012

Municipality Administrative Fee

Town of Davie $113,714

City of Coral Springs 174,714

Total Administrative fee to be paid to the County

$287,958

Source: Prepared by County Auditor’s Office based on the LHAP provisions

We found that the fees are based on estimated rather than actual costs to administer the program. As of February 2012, Division staff had not performed a cost analysis to ascertain whether payments received were sufficient to cover the County’s actual administrative costs. Without such analysis, the County may be subsidizing the municipalities. Recommendation To ensure the County recoups the actual costs to administer SHIP grant funds for Davie and Coral Springs, we recommend the Board of County Commissioners direct the County Administrator to:

13. Prepare an analysis of actual costs and fees collected for administering the cities’ grant funds and report the results to the Board by December 31, 2012.

Compliance Review


APPENDIX A MBC’s Non-compliance with Contract Requirements

Contract Requirements Findings/Significance Article 3.4.2 “Quotations shall be received by MBC and shall be publicly opened in the presence of one or more witnesses.”

Lack of documentation for witnesses present at opening of quotations. No evidence of documentation of witnesses for 27 (90%) of 30 client files sampled. Public opening of quotations ensure that the evaluation process is fair and objective and includes contractors that complied with the submission deadline. Otherwise, lower bids could be ignored or eliminated from the quotation summary, ultimately increasing the cost to the County.

Article 3.4 The specifications and plans for repairs (scope of work) shall be reviewed by County and approved for compliance with the LHAP prior to advertisement. Article 3.8 All individual project scope of work shall be submitted to the County for approval prior to advertisement or implementation.

Client files did not contain County approval of the scope of work prior to advertisement. We found ten (33%) of the 30 client files did not contain County approval of the scope of work prior to advertisement. The approval process provides County personnel the opportunity to ensure compliance with the LHAP and confirms repair items documented during the initial visit.

Failure to obtain County approval of the scope of work prior to advertisement could result in procurement of unauthorized services.

Article 3.4.3 “Quotations shall be unconditionally accepted without alteration or correction.”

Bid alterations occurred after bid opening. We found additional repair items were added by MBC after the bids were opened that increased the quotes for four (13%) of the 30 clients:

For three clients, only the quotes submitted by the subcontractor awarded the repair contract were increased. Allowing only the awarded contractor to submit quotes on the additional repair items may have resulted in higher prices to the County.

For one client, the quotes submitted by all contractors were increased.

The changes amended the scope of work previously approved by the County and may have resulted in unauthorized repair items.

Compliance Review


APPENDIX A – Continued Contract Requirements Findings/Significance

Article 3.4.1 “.. All awards shall be solicited using sealed quotations which shall be requested from a minimum of three (3) pre-qualified subcontractors...”

MBC requested solicitations from less than three contractors. The review found MBC solicited quotations from one contractor for three (10%) of the 30 clients sampled. This issue was cited in our review dated March 10, 2003. Failure to obtain a minimum of three quotes subverted the competitive process and may have resulted in the County paying higher prices.

Article 3.4.1 “...MBC will ensure requests for quotations are sent to subcontractors on the MBC pre-qualified list and the prequalified list provided by the County's Purchasing Division.., Vendors placed on the County’s prequalified list have been determined to be responsible, qualified, and licensed to perform services for the County.”

MBC accepted quotations from vendors that were not prequalified. MBC accepted quotations from subcontractors that were not included on the County’s or MBC’s prequalified vendor list for three of the repairs sampled. One repair was awarded to a subcontractor that was not on the County’s or MBC’s prequalified vendor lists. The acceptance of the quotes and award of the repair contract violated the terms of the agreement and may have resulted in an award to a non-responsible subcontractor.

Article 8.2 MBC shall maintain comprehensive general liability insurance coverage for the term of the agreement evidenced by a certificate of insurance which provides the County with a thirty days prior written notice of non-renewal. Article 8.4 Insurance required herein shall be evidenced by certificate of insurance which provides COUNTY with a thirty (30) day prior written notice of cancellation or nonrenewal.

Insurance certificate does not provide for a 30 days prior written notice of non-renewal. We found the certificate of insurance does not require 30 days prior written notification to the County, of non-renewal. Failure to require 30 days prior written notice of non-renewal could delay the County’s ability to take action against MBC

Compliance Review


APPENDIX B

Division’s Non-compliance with Procedures, Contract, and LHAP Contract Requirements Findings/Significance

LHAP requires a mortgage and promissory note for the repair costs.

Mortgages and promissory notes did not include all cost of repairs. We found the mortgages for the 13 Broward County clients excluded repair cost and administrative fee totaling approximately $79,400 and mortgages for three clients excluded repair cost totaling approximately $40,000. Failure to include all costs, including the administrative fee when applicable, understates the mortgage and promissory notes, violates the LHAP requirements, and reduces the payoff amount in the event of a sale or title change during the term of the mortgage.

The Broward LHAP requires the mortgage and promissory note to provide for full repayment if the home is sold, assigned, or if there is transfer of title during the ten year term. The Coral Springs and Davie LHAP require prorated repayment if the home is sold, assigned, or if there is transfer of title during the five year term.

Inaccurately stated property sale and title transfer provisions. We found the following inconsistencies:

The promissory notes for the 13 Broward clients were inconsistent with the LHAP by requiring prorated forgiveness over the ten year period instead of full repayment.

Mortgages for the 17 Coral Springs and Davie clients were inconsistent with the LHAP by requiring payment in full instead of prorated repayment.

The inconsistencies create confusion in determining a payoff amount during the term of the mortgage.

The LHAPs require a mortgage and promissory note for the repair costs.

Failure to obtain joint owners’ signatures. The mortgages and promissory notes for two properties that had joint ownership were not signed by all owners. Failure to include all owners in the mortgage and promissory notes and obtain their signatures could result in a legal challenge by the excluded owner.

Compliance Review


APPENDIX B – Continued

Contract Requirements Findings/Significance The Broward LHAP requires a ten year term for mortgages and promissory notes. The Coral Springs LHAP requires a 5 year term for mortgages and promissory notes.

Erroneous mortgage/promissory note terms.

A promissory note for a Broward client erroneously stated a term of five years while the mortgage reflected a ten year term. Inconsistent terms create confusion and could prevent accurate calculation of payoff if a sale or title transfer occurs during the mortgage term. The error could also result in full write off and premature settlement of the mortgage in five years.

A mortgage and promissory note for a Coral Springs client erroneously stated a term of ten years instead of five years. The incorrect term violates the LHAP and encumbers the client’s property for five additional years.

The LHAP for Davie, states that disaster relief assistance is designed to provide home repairs to eligible applicants who suffered damage as a result of natural disaster. The natural disaster shall be declared by Executive Order from the President of the United States, Governor of the State of Florida or by the Broward County Board of County Commissioners, and the applicant either did not receive sufficient funds for repair of all or did not have insurance to provide for all repairs.

Disaster Relief Assistance did not comply with the requirements of the LHAP. One client received disaster relief repairs totaling $19,996. However, the client’s file did not document a declared natural disaster, as required. The expenditure could result in unauthorized disbursement of grant funds and may require the County to pay back grant funds.

The LHAP for Coral Springs states that applicants that received home repair assistance from the city cannot re-apply for five years. Also, applicants for barrier free repairs will not be eligible for

Repair and barrier free11F11F

12 assistance did not comply with requirements of the LHAP. We found two clients received both home repair and barrier free assistance within a five year period:

One client received repair assistance totaling $37,900 on November 6, 2009 and later received barrier free assistance totaling $16,163 on March 30, 2010, and

12

Per the FY 2008 – 2010 LHAP - Barrier free repairs are designed to remove barriers, improve accessibility to the

elderly (62 years or older) and disabled persons, and to provide for health and safety repairs as needed by older and

disabled persons to maintain their independence.

Compliance Review



Contract Requirements Findings/Significance additional repairs for a period of five years from the date of the mortgage.

Another client received repair assistance totaling $29,600 on September 30, 2009 and later received barrier free assistance totaling $19,950 on November 3, 2010.

The LHAP is ambiguous, and can be interpreted to mean clients cannot receive additional repair assistance within five years regardless of the strategy. Providing multiple repair assistance to the same individual within five years violates the terms of the LHAP and reduces available funding for additional clients.

In order to determine eligibility for repair assistance Division procedures require applicants to provide documents that include the following:

Mortgage Statement(s) showing that mortgage is not delinquent.

Residency card or other immigration documents.

Tax Returns, W-2 or 1099's (2 years). If self-employed, provide a signed Year to date P&L statement.

Copy of Warranty Deed

Proof of full time student, status.

The Division did not perform proper eligibility assessments.

Twenty client files did not document mortgage statements. Failure to confirm the mortgages are current could result in repairs to properties that have delinquent mortgages and are subject to foreclosure. Thereby renovating “bank owned property” if the bank later forecloses on the mortgage.

Fifteen client files did not contain documentation of citizenship/immigration status. Failure to obtain poof of immigration status could result in awards to undocumented aliens.

Seven client files did not contain complete IRS tax returns, W-2s, and 1099's for two years prior to the application. This issue was cited in a review dated March 10, 2003. Also, one client‘s file did not contain a year-to-date profit and loss statement for a self-employed household member. Failure to obtain the tax returns, W-2, 1099’s, and profit and loss statements could result in understatement of income.

Two applications did not list all owners on the warranty deeds and did not provide explanations why they were excluded. Failure to ensure completeness of the application could result in understatement of household income and awards to clients who would not otherwise qualify for assistance.

Two files did not contain proof of full time student, status. This issue was cited in a review dated March 10, 2003.

Failure to ensure completeness of the client’s application could result in understatement of household income.

Compliance Review



Contract Requirements Findings/Significance LHAP requires that repairs are performed to owner occupied properties.

The Property Appraiser’s records for one client did not document homestead. The client’s file also did not include documentation to support owner occupancy. Repairs to non-homestead property violate the LHAP and could require the County to pay back grant funds.

The LHAPs for Broward and Davie state, “Applicants must receive a certificate of housing counseling upon completion of the home repair education and counseling workshop”.

Three client files did not contain evidence of completion of the Home Repair Education & Counseling Workshop. This issue was cited in our review dated March 10, 2003. The workshop provides applicants with information regarding:

The responsibilities of home ownership,

The importance of maintaining the property,

The mortgage and promissory documents that they will later be required to sign, and

Contacts for local vendors, such as plumbers, electricians, etc.

Clients who do not attend the workshop would not otherwise receive the information.

The LHAP states the income limits used in the SHIP Program are updated annually by the Department of Housing and Urban Development and distributed by the Florida Housing Finance Corporation.

The incomes for two clients were miscalculated. As a result:

One client was classified as low income, but when recalculated by the auditor the applicant was classified as extremely low.

The second client was erroneously classified as low because the income calculation did not include overtime. The income was recalculated by the auditors as moderate.

After the recalculation, both clients remain eligible for services. Failure to ensure correct calculation of a client’s income could result in misclassification of an applicant’s income category.

The LHAP requires that repairs are made to owner occupied properties and that the terms and conditions are maintained 10 years for properties repaired with Broward SHIP funds and 5 years for properties repaired by Davie and Coral Springs.

The Division does not monitor owner occupancy requirement during the term of the mortgages. This issue was cited in a review dated March 10, 2003. Division staff cited staff reductions as the cause for not monitoring the occupancy requirements. The failure to monitor occupancy may result in undetected violations.

25

APPENDIX C Follow-up on MBC Related Findings & Recommendations

Broward County Office of Internal Audit Report dated March 10, 2003 Financial and Compliance Review of the Housing Finance Authority and Office of Housing Finance

March 2003 Finding

March 2003 Recommended/Requested Action

March 2003 Management's Response

March 2003 Disposition

March 2012 Update 12F12F

13 Finding 15. Missing Home Repair Checks and Mortgages

The Director of Human Services should direct staff of the HFA to record the mortgages with County Records.

Staff agrees that a better mortgage tracking system is needed. Also, staff will be directed to record the mortgages with County records for those properties which have not been sold. Additionally, staff have implemented a tracking system to verify that all mortgages sent to County Records are returned prior to repairs being commenced by the contractor. Staff expects a procedure in place by March 28, 2003.

Open pending recording of mortgages

Unresolved – See Finding 3. Untimely recording of mortgages and promissory notes cited in current review.

Finding 18. Failure to Record Mortgages Timely

The Director of Human Services should: A. correct the errors in recording the

mortgages and promissory notes B. establish procedures to ensure

mortgages are recorded timely and accurately in the public record.

C. monitor compliance with the

procedures.

A. This problem has been addressed through the addition of staff positions.

B., C. The Finance Manager and SHIP Contract Administrator will follow through with the procedure developed to record mortgages timely and will monitor compliance.

A.,B., C. Open pending completion of corrections and review of procedures by OIA

Unresolved – See Finding 3. Erroneous and untimely recording of mortgage/promissory notes cited in current review.

Finding 19. Payments of Fees to

The Director of Human Services should immediately discontinue payment of fees

Staff only partially agrees with this finding. This error was corrected in the FY 2002 contract with Stein and

Open pending publication of RFP and

Resolved. Fees are established in

13

When applicable the update refers to the March 6, 2012 Review of Broward County Minority Builders Coalition

SHIP Home Repair Program conducted by the Office of the County Auditor.

APPENDIX C – Continued

Follow-up on Selected Recommendations

26

March 2003 Finding





13 MBC and Stein Gerontology (Stein) Were Not Authorized in the Respective Contracts

to MBC and Stein. currently provides for a 200/0 fee for each job. It appears that the language was apparently omitted from the MBC contract. These contracts will not be renewed and instead, staff will be directed to publish a RFP by the end of April, 2003.

review of new agreements.

the contract awarded to MBC from 2009 RFP process.

Finding 20. Payment of Fees Based on a Percentage of Cost to MBC and Stein Creates a Conflict of Interest

The Director of Human Services should immediately terminate the agreements with MBC and Stein and direct the HFA staff to utilize the existing list of qualified vendors maintained by the Purchasing Division for the Community Development Division.

These contracts will not be renewed and instead, staff will be directed to publish a RFP by the end of April, 2003.

Open pending publication of RFP and review of new agreements

Unresolved – See Finding 2. Contract requires use of prequalified vendors and competitive bids. However, MBC only solicited from one vendor for 10% of the clients reviewed and awarded repairs to a vendor that was not prequalified.

Finding 21. Fees Paid to MBC and Stein Were Not Consistently Determined

See Recommendation under Finding 20 above.

These contracts will not be renewed and instead, staff will be directed to publish a RFP by the end of April, 2003.

Open pending publication of RFP and review of new agreements.

Resolved. Fee payments to MBC complied with the contract.

Finding 22. MBC Failed to Disclose Related Party Transactions


These contracts will not be renewed and instead, staff will be directed to publish a RFP by the end of April. 2003.


Resolved. No related party awards were noted during the current review.



27

March 2003 Finding





13 Finding 23. Solicitation and/or Award of Bids by MBC and Stein


These contracts will not be renewed and instead, staff will be directed to publish a RFP by the end of April1 2003.


Unresolved – See Finding 2. MBC failed to obtain a minimum of three bids for three repair awards.

Finding 25. Monitoring of Barrier Free, Home Repair Contracts and Other Mortgage Provisions was not Evident

The Director of Human Services should direct the Planning, Development Research and Evaluation Division to perform periodic monitoring of all SHIP and HFA funded programs contracts and mortgage provisions.

Staff has conducted a review and it appears that this finding is accurate. Prior to completion of the audit, the Department had initiated steps to reorganize the contract monitoring function. A Contract Grants Administrator has been hired. Additionally, staffs who have been assigned the role of inspecting construction and home repair has commenced training to improve their knowledge and skills in this area. The Department will implement other actions in the near future to strengthen this area of accountability.

Resolved Unresolved – See Finding 1. Current monitoring and evaluation activities are insufficient to ensure project quality objectives are met.

Finding 26. Inspections of Barrier Free and Home Repair Work Not Documented

The Director of Human Services should: A. immediately require all inspections be

documented, and B. institute supervisory reviews over the

inspection process.

A. Staff has conducted a review of this inspection/documentation process and will institute procedures by the end of March 2003 that ensures that an inspection checklist to document the home repair has been completed in an acceptable manner. This documentation will be provided to support the payment of an invoice and be processed with the invoice.

B. Staff has been hired to perform supervisory

reviews over the inspection process.

A. Open pending

implementation of procedures

B. Resolved

Unresolved – See Finding 1. Current monitoring and evaluation activities are insufficient to ensure project quality objectives are met.



28

March 2003 Finding





13 Finding 28. Other Contract Compliance Issues -Stein Gerontology Contract

The Director of Human Services should: A. designate a contract administrator

responsible for monitoring and enforcing compliance with the provisions of every contract.

B. provide for supervision over the

contract administration process. C. direct the Planning, Development.

Research and Evaluation Division to perform periodic monitoring of all SHIP funded contracts to include evaluation of contract administration.

Staff has conducted a review and this finding is accurate. A. A Contract Grants Administer has been hired to

ensure compliance with SHIP. B. A part of the Department's quality improvement

process. the Department has added procedures to help the Contract Grant Administrators note when documentation has not been received and flag those Providers so that payment can be suspended until requirements are met.

C. Additional Quality Assurance will be performed by the Program Development Research and Evaluation Division to ensure compliance with SHIP program requirements and improve the quality of client files.

A. Resolved B. Resolved

C. Resolved

A. Unresolved – See

Finding 1. Current monitoring and evaluation activities are insufficient to ensure project quality objectives are met. B. Unresolved – See

Findings 2 and 3. MBC was noncompliant with key contractual requirements. The Division did not comply with internal procedures and key LHAP provisions. C. Unresolved – See

Finding 3. Program is not being monitored.

Finding 29. New Construction Program is Adversely Affected by Extensive Construction Delays

The Director of Human Services should establish procedures to: A. evaluate proposing contractors based

on ability to complete construction projects on schedule

A., B., C., D. Staff will review OIA's recommendation as it moves forward in its affordable housing plan.

A., B., C.,D. Open pending development of affordable housing plan

Unresolved – See Finding 1. Significant project delays occurred and neither



29

March 2003 Finding





13 B. include penalties for construction

delays in contracts with construction contractor

C. established and monitor performance criteria for all construction contractors

D. use prior performance in awarding new contracts

MBC nor the Division has tracked project timeliness as required.

Finding 32. New Construction Program Mortgages and Promissory Notes do Not Conform to LHAP Requirements

The Director of Human Services should coordinate with the County Attorney to revise the mortgages and promissory notes to include the affordability requirements of the 1999 LHAP.

The temporary employee who was handling SHIP mortgage payments has been replaced by a permanent employee who is well-versed in the requirements of the program. In addition, procedures have been written documenting the process to be followed. The Director of Human Services will, by the end of April, 2003, request the County Attorney to revise the mortgages and promissory notes to include the affordability period if the subsequent purchaser does not meet the income categories as required.

Open pending execution of revised mortgages and notes.

Unresolved – See Finding 3. Flawed mortgage and promissory note documentation.

Finding 33. SHIP Grant Award Maximums Were Exceeded

The Director of Human Services should: A. have the LHAP amended to increase

the maximum allowable grant amounts.

B. take steps to ensure that future

expenditures of SHIP program monies are consistent with the approved LHAP strategies.

Staff have conducted a review and it appears that this finding is accurate. A. Staff will commence the necessary steps to have

the LHAP amended to increase the maximum allowable grant amounts by the end of April, 2003.

B. Staff has implemented procedures to ensure that future expenditures of SHIP program monies are consistent with the approved LHAP strategies.

A. Open pending

amendment of the LHAP

B. Resolved

Unresolved – See Finding 1. Noncompliance with current cost control measures resulted in project cost overruns in excess of SHIP maximums.



30

March 2003 Finding





13 Finding 36. Review of Client Files

The Director of Human Services should: A. direct HFA staff to obtain

documentation to support the eligibility of the clients

B. recover funds from applicants deemed ineligible, if any

C. immediately institute a quality assurance function over the HFA client processing to ensure compliance with SHIP program requirements and improve the quality of client files

D. direct the Planning, Development. Research and Evaluation Division to perform periodic monitoring of all SHIP funded programs and contracts.

Staff has conducted a review and it appears that this finding is accurate. A.-C. With regard to the documentation errors and noncompliance issues cited during the review of client files, a Contract Grant Administrator has been hired to oversee the contract monitoring function D. Quality Assurance will be performed by the Program Development Research and Evaluation Division to ensure compliance with SHIP program requirements and improve the quality of client files.

A. Resolved B. Open pending

further review C. Resolved D. Resolved

Items A,C and D Unresolved – See Finding 3. Faulty client eligibility process and program is not being monitored. B. Resolved. No related issues noted during the review.

Finding 37. Verification of Applicant Information

The Director of Human Services should implement procedures requiring verification of financial and household information relied upon in determining client eligibility and income category.

Staff has conducted a review and it appears that this finding is accurate. Procedures have been implemented requiring verification of financial and household information relied upon in determining client eligibility and income category.

Resolved Unresolved – See Finding 3. Faulty client eligibility process.



31

March 2003 Finding





13 Finding 39. Barrier Free and Home Repair Occupancy Requirements

The Director of Human Services should: A. designate a contract administrator

responsible for monitoring and enforcing mortgage compliance including occupancy requirements.

B. provide for supervision over the contract administration process

C. direct the Planning, Development, Research and Evaluation Division to perform periodic monitoring of all SHIP mortgages

A., B., C. By the end of April. 2003 staff will request that the County Attorney's Office delete this requirement from future notes and mortgages.

A., B., C. Open pending amendments to notes and mortgage documents

Unresolved – See Finding 3. The Division does not monitor owner occupancy requirement during the term of the mortgages.

Finding 40. Home Repair and Barrier Free Mortgage Liens do not Reflect All Costs

The Director of Human Services should: A. determine if all costs of SHIP funded

repairs should be included in the mortgage liens to comply with SHIP requirements, and

B. if not required, modify the LHAP to appropriately reflect the policy, or

C. if required, file amended mortgage liens for all repairs which excluded fees.

A., B. By the end of April, 2003, staff will complete the necessary steps to amend the LHAP to include administrative fees in mortgages.

A.,B. Open pending execution of amended contracts

Unresolved – See Finding 3. Mortgages and promissory notes did not include all cost of repairs

review of contract compliance broward county minority ... 1. mbc... · counseling workshop and...

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