Audit Report on the Human Resources Administration’s Monitoring and Oversight of Vendors Who Provide Housing to Clients of the HIV/AIDS Services Administration

Management Audit

EXECUTIVE SUMMARY

The objective of this audit was to determine whether the Human Resources Administration (HRA) has adequate controls in place to ensure that vendors are providing services to HIV/AIDS Service Administration (HASA) clients in accordance with their agreements.

HRA’s HASA provides assistance to individuals with AIDS or clinical symptomatic HIV illness in applying for public benefits and services and case management.  HASA also provides supportive housing for HASA clients and their immediate family members who are homeless or at risk for homelessness.  HASA provides two types of supportive housing: non-emergency (permanent) housing and emergency transitional housing.  According to information provided by HASA, between July 1, 2012, and April 16, 2014, HRA had 170 active contracts with 61 vendors that required them to provide approximately 5,600 units of permanent and emergency housing.  HRA during this period also had 43 agreements that they identified as Memorandums of Understanding (MOUs) with 32 vendors that required them to provide an additional 1,459 units of housing.

HASA monitors its housing vendors in four ways: 1) HASA Housing Specialists conduct housing inspections of vendors’ facilities and units; 2) HASA’s Quality Assurance (QA) staff perform program evaluations by reviewing sample case records and inspecting sample units; 3) HASA’s Finance unit monitors vendors’ timely submission of required reports (e.g., budget and monthly reports); and 4) HASA oversees expenditures through its Finance unit conducting monthly reviews of invoices submitted by the vendors (desk audits).  In addition, HRA’s Bureau of Internal Vendor Audits started assisting HASA by performing fiscal audits of vendors (fiscal accountability) as of July 2013.

Audit Findings and Conclusion

The audit found that HRA has inadequate controls to ensure that its vendors provide services to HASA clients in accordance with applicable contract requirements.  The housing inspection database HRA developed to track housing inspections is unreliable and management has not developed an alternate method by which to track inspections.  In addition, we found no evidence that housing inspections were consistently conducted in a timely manner or that inspection results were promptly formally shared with vendors.  Further, we found that HASA does not ensure that inspections are conducted in a consistent manner among its inspectors.

We also found that HRA does not ensure that key contract terms are followed and does not evaluate contract terms for current applicability or have a formal mechanism to ensure that contracts that are renewed reflect the agency’s current programmatic priorities.  In addition, we identified a number of instances in which HRA continued to pay vendors for clients after they were reported as deceased.  We also found that HRA did not ensure that assessments of customer satisfaction were performed as required by PPB Rules.  Finally, we also found weaknesses in HRA’s oversight designed to ensure fiscal accountability by the vendors, including its failure to complete any fiscal audits of HASA vendors.

Audit Recommendations

Based on the audit we make 17 recommendations, including:

• HRA should ensure that any data processing issues responsible for errors and inconsistencies in the management reports generated by the database are corrected.
• HASA should ensure that an attempt is made to inspect all contracted units within established timeframes and that it maintains a record of those attempts.
• HASA should ensure that inspection results are formally shared with vendors timely and that it maintains evidence of such notifications.
• HASA should provide training and guidance as needed to staff to ensure that they have a good understanding of the inspection process and that inspections are conducted in a consistent manner.
• HRA should ensure that HASA’s QA program evaluation includes all key contract provisions, including those that are unique to the different categories of housing and services provided to clients.
• HASA should ensure that reports are appropriately used to identify deceased clients so that payments to the vendors for the clients’ housing can be stopped and/or other clients can be moved into those units in a timely manner.
• HRA should include specific contact information on how complaints can be submitted in the “Client Bill of Rights” that is distributed to clients.
• HRA should make efforts to complete the fiscal audits of HASA vendors to determine whether expenses are being billed in accordance with the contracts and to identify whether there are any areas of concern that may need additional controls.

Agency Response

In its response, HRA generally agreed with all of the audit’s findings and agreed with 15 of the audit’s 17 recommendations.  HRA disagreed with the recommendations that it ensure that reports are appropriately used to identify deceased clients and that it recoup the overpayments made to the vendors for the deceased clients referenced in this report, maintaining that no corrective action is needed.   The full text of HRA’s response is included as an addendum to this report.