Audit Determines Department of Housing Preservation and Development Held Back Money That Should Have Gone to Help Fund City Budget
NEW YORK, NY – November 22, 2011 – (RealEstateRama) — City Comptroller John C. Liu today announced that an audit of the Department of Housing Preservation and Development (HPD) found that the agency kept $9.8 million in unused funds from expired contracts and other sources – money that should have been returned to the City treasury.
“This money could have and should have been used to improve shelters, especially in light of rising homelessness,” Comptroller Liu said. “If HPD can’t use it right then the money should be put back in the City treasury.”
Auditors found that the agency inappropriately used a portion of the funds to supplement its operating budget and get around the budget process. The money uncovered by the audit was part of the HPD’s Relocation Shelter account, which is earmarked for capital expenditures at emergency shelters. As of October 2010, the agency had accumulated over $9.8 million in excess funds in the account. The bulk of that money came from contracts that had expired, with HPD holding on to money that could have been used for capital improvements.
The audit recommends that the agency return the $9.8 million to the City treasury. Agencies are not generally permitted to keep unused funds from expired contracts. The audit disagreed with HPD’s assertion that it had received prior permission to retain the unused funds.
The scope of the audit was July 1, 2009, through October 31, 2010.
Comptroller Liu credited Deputy Comptroller for Audit Tina Kim and the Audit Bureau for presenting the findings. The full report is available at: http://comptroller.nyc.gov/audits
“HPD is spending the shelter reserve funds appropriately and will continue to do so. The Comptroller’s office originally approved the language of these contracts which stipulated that the reserve funds in question had to be maintained until the contracts with the shelter providers expired. HPD began spending the reserve funds immediately following the expiration of the contracts in order to continue to fund our Emergency Shelter System which provides emergency housing and support services to New Yorkers who have been displaced from their homes due to disasters. The current spending plan for these shelter reserve funds was voted on and approved by the City Council, of which Comptroller Liu was a member at the time.” said Eric Bederman, press secretary for HPD
Contact:
Eric Bederman
Press Secretary
NYC Dept. of Housing Preservation and Development (HPD)
(212) 863-5176
bedermae (at) hpd.nyc (dot) gov
www.nyc.gov/hpd
Matthew Sweeney,
(212) 669-3747
