GAO: HFAs, PFAs Performed Well with Recovery Act Funds

The American Recovery and Reinvestment Act of 2009 (Recovery Act) allotted $4 billion to the Department of Housing and Urban Development's (HUD) Public Housing Capital Fund while Congress also created two programs to assist Housing Finance and Public Housing Agencies (HFAs and PHAs) to assist them to restart projects that had stalled due to lack of funds.  At the request of HUD the Government Accountability Office (GAO) recently undertook a study to determine if those funds were spent on time and for the intended purposes.  The study also assessed the quality of the job estimates reported by the program recipients.

GAO visited PHA and HFA sponsored projects in seven states and the District of Columbia, interviewed federal and local agency officials, evaluated HUD's monitoring strategies as well as those of the Department of the Treasury which was responsible for all Recovery Act money, surveyed 56 HFAs, and analyzed recipient-reported data.

GAO reported that all PHAs meet their spending deadlines under the programs and all but one PHA spent 100 percent of their grants by the March 17, 2012 deadline.  About 3,100 PHAs had submitted plans to undertake improvements with the grants that affected about 495,000 housing units and many of the improvements enhanced energy efficiency. GAO also found that HUD had incorporated key internal controls that allowed them to compare actual with planned results.

All HFAs were also found to have met their several deadlines.  Most reported that the funds helped restart stalled affordable housing projects that otherwise could not have moved forward and most of those involved construction of new housing units.

GAO recommended in their report that Treasury assess the extent to which HFAs are utilizing information from project owners under their purview to ensure the long term viability of buildings during the 15-year compliance period while taking into account the owners equity in the projects.