Subcommittee Examines Waste, Fraud, Abuse in HUD Spending Programs
September 10, 2013 -
Members of the House Financial Services Oversight and Investigations Subcommittee today questioned the Department of Housing and Urban Development’s Inspector General about reducing waste, fraud, and abuse at HUD.
During the hearing, the subcommittee reviewed the most recent report from Inspector General David Montoya, which identified more than $770 million in questionable costs and included recommendations for putting $739.5 million in HUD funds to better use.
The subcommittee found that HUD’s largest programs – including disaster relief programs and the Community Development Block Program (CDBG) - lack proper oversight and are especially vulnerable to waste, fraud, and abuse.
Subcommittee Chairman Patrick McHenry (R-NC) said HUD’s management of the CDBG program is of particular concern.
“Over the years, HUD has failed to adequately account for how taxpayer funds are being spent in the CDBG program, leading to wasteful spending on frivolous pork barrel projects,” Chairman McHenry said. “Although one of the three national program objectives for CDBG is that projects principally benefit low and moderate-income persons, critics have noted that CDBG funds often end up being used for parks, pools, street signs, and community centers, diverting dollars from those communities with the greatest need, particularly housing.”
The CDBG program is the largest source of federal financial assistance in support of state and local neighborhood revitalization, housing rehabilitation, and economic development activities.
In its oversight plan for the 113th Congress, the Financial Services Committee noted its concern about questionable uses of CDBG funds and committed to examine how grant recipients use CDBG funds in order to ensure they are properly spent.