Report 2018-037 Recommendation 19 Responses
Report 2018-037: California Department of Housing and Community Development: Its Oversight of Housing Bond Funds Remains Inconsistent (Release Date: September 2018)
Recommendation #19 To: Housing and Community Development, Department of
To ensure that it does not exceed administrative cost restrictions and that it maximizes the funds intended to address target populations' housing needs, HCD should estimate when it will run out of administrative funds for any specific program, document its projection methodology, and provide underlying data and support for its estimates. The projections should include, but not be limited to, actual staff time spent on the program, the number of awards being monitored, and the length of monitoring. Staff should provide these projections and methodologies to management for review and approval by December 1, 2018, and then at least biannually thereafter.
Annual Follow-Up Agency Response From October 2023
HCD believes that the steps described on the last response addresses the CSA Recommendations. On an annual basis California Department of Housing and Community Development (HCD) forecasts expenditures against available appropriations and uses the Baseline Bond Adjustment (BBA) drill to Department of Finance (DOF) to plan and document administrative costs that will be charged to given bond programs. HCD followed up with CSA regarding why they believed our response was not considered fully implemented, but upon further discussion HCD does not believes the additional suggested steps are applicable to the established process and procedures established by DOF.
- Completion Date: September 2022
California State Auditor's Assessment of Annual Follow-Up Status: Pending
HCD provided a budget letter related to adjusting the budget and appropriations. However, the budget letter does not specify that projections should include considerations such as actual staff time spent on the program, the number of awards being monitored, or the length of monitoring. Further, HCD did not provide us with projections for when it estimates that it will run out of administrative funds for any specific program.
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From September 2022
On an annual basis California Department of Housing and Community Development (HCD) forecasts expenditures against available appropriations and uses the Baseline Bond Adjustment (BBA) drill to Department of Finance (DOF) to plan and document administrative costs that will be charged to given bond programs.
- Completion Date: August 2022
California State Auditor's Assessment of Annual Follow-Up Status: Pending
HCD provided a budget letter related to adjusting the budget and appropriations. However, the budget letter does not specify that projections should include considerations such as actual staff time spent on the program, the number of awards being monitored, or the length of monitoring. Further, HCD did not provide us with projections for when it estimates that it will run out of administrative funds for any specific program.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From September 2021
On an annual basis California Department of Housing and Community Development (HCD) forecasts expenditures against available appropriations and uses the Baseline Bond Adjustment (BBA) drill to Department of Finance (DOF) to plan and document administrative costs that will be charged to given bond programs.
- Estimated Completion Date: 6/30/2022
California State Auditor's Assessment of Annual Follow-Up Status: Pending
Annual Follow-Up Agency Response From September 2020
HCD has entered into a financial consulting service contract to develop and improve upon processes to reconcile financial data in CAPES. This service contract will be used to implement best practices and develop financial tools and procedures to streamline complex budgetary controls, including bond management, loan management, and monitoring and controlling administrative expenditures to maintain compliance with statutorily authorized administrative caps. This service contract will assist in addressing the CSA findings.
- Estimated Completion Date: December 2021
California State Auditor's Assessment of Annual Follow-Up Status: Pending
1-Year Agency Response
HCD has developed a tool which tracks the projected administrative set aside need for each program. This tool will be reviewed on a quarterly basis with the Budgets unit, and updated bi-annually in conjunction with the staffing needs associated with long-term monitoring identified in the staff management tool (SMT).
- Completion Date: April 2019
- Response Date: September 2019
California State Auditor's Assessment of 1-Year Status: Pending
HCD did not provide evidence to show that it documents its projection methodology or provide underlying data and support for its estimates.
6-Month Agency Response
HCD has developed a tool which tracks the projected administrative set aside need for each program. This tool will be reviewed on a quarterly basis with the Budgets unit and updated bi-annually in conjunction with the staffing needs associated with long-term monitoring identified in the staff management tool (SMT).
- Estimated Completion Date: 03/29/2019
- Response Date: March 2019
California State Auditor's Assessment of 6-Month Status: Pending
60-Day Agency Response
HCD will include within the plan developed, in the response to Recommendation 3A, the long-term plan and projection of how long the administrative set aside will last for each bond-funded program. Staff and other administrative costs will be tracked quarterly, and the long-term estimate updated bi-annually.
- Estimated Completion Date: 12/31/2018
- Response Date: November 2018
California State Auditor's Assessment of 60-Day Status: Pending
All Recommendations in 2018-037
Agency responses received are posted verbatim.