HUD Inspector General Testifies before House Appropriations Panel, Critical of MTW

On March 15, the House Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies held a hearing on the budget requests for Offices of Inspector General (OIG) for HUD and the Department of Transportation (DOT). HUD Inspector General David Montoya and DOT Inspector General Calvin Scovel testified.

Mr. Montoya praised HUD Secretary Julián Castro for his responsiveness and willingness to partner with the OIG, but said that HUD’s audit problems stem from lack of staff expertise in financial management and accounting. He said that while there have been improvements within the agency, HUD was too slow to implement recommendations and respond to concerns made by his office. He also said that HUD’s slowness in filling key staff positions contributed to the problem and poses particular cause for concern as 43% of HUD’s staff are eligible for retirement.

Representative Henry Cuellar (D-TX) asked Mr. Montoya how the Subcommittee should measure performance outcomes of federal programs to ensure they are producing results. Mr. Montoya pointed to the Moving to Work program as a prime example of a program that has failed to be evaluated for its impact. He said, “For the last 20 years, there have been 39 public housing authorities in the Moving to Work program, which allows for locally innovative new ways of performing housing and self-sufficiency and these sorts of things. The problem is that in 20 years, they have never had a performance measure and I don’t think that we’ve ever had one as an example of what exactly came from this program that basically has a lot less rules and a lot more flexibility to it. And yet Congress has just expanded it. We have serious concerns that that’s ever going to be successful. Quite frankly, out of the 39 Moving to Work housing authorities that have been in the program, we’ve investigated five of them under at least 23 different investigations for abuse, fraud, [and] mismanagement of the program because of the lack of oversight that the department has provided.”

Representative David Young (R-IA) raised concerns about over-income tenants living in public housing and the “lack of desire” by HUD to do anything about it. Mr. Montoya responded, “What we’ve seen on the over-income, and what I want to make sure we’re clear on, is that these public housing authorities have had the authority since at least 2004 to remove those high-income earners from public housing. Often we heard that the reason that they haven’t done it is because to do that takes away from the additional rent that they’re able to make off the higher salaried families. So it’s a choice. The other thing we’ve heard is that they don’t believe they have the authority to do so, although we feel that they do.”

Watch the archived webcast and read hearing testimony at: