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City staff detail CDBG FY2021–22 reconciliation; council hears audit of earlier reporting errors
Summary
City staff told the Durham City Council that internal reporting errors in Community Development Block Grant (CDBG) records for fiscal year 2021–22 required retroactive adjustments. Staff said errors were staff-discovered and will be reconciled through HUD’s IDIS system; council asked for clarification on revenue declines and project refunds.
City staff told the Durham City Council on Feb. 17 that the Community Development Block Grant (CDBG) reconciliation for fiscal year 2021–22 required retroactive adjustments after staff identified reporting defects.
Reginal Johnson, director of Community Development, said staff found inconsistent reporting in earlier project records and that the department is correcting those errors so withdrawals and reimbursements can be processed in HUD’s Integrated Disbursement and Information System (IDIS). He described the findings as the result of a staff review; the transcript notes the issue was not identified by an outside consultant.
Maggie Carnegie, a city finance staffer, explained that an HOD appropriation increase of roughly $31,000 had been overlooked in a prior transaction processing (TPO) and that program income originally reported at $193,000 must be amended downward to $84,000. Councilor Cook pressed staff to explain the apparent $110,000 decline in program income and whether the two inconsistencies were related. Carnegie said the discrepancies were human errors in consolidated reporting and that staff plan an internal review covering the prior five years to identify any similar inconsistencies.
Councilors asked whether correcting prior-year records would create timing or compliance problems. Staff said the corrections can be processed through the typical IDIS withdrawal and reimbursement workflow and that the relevant CDBG program’s period of performance extends across multiple years; staff emphasized that the current reconciliation focuses on the 2021 program year and associated projects whose reimbursements are still pending.
During the discussion staff identified one affected project as the “Pros Road” project and said the recipient for that project are the same developers/investors involved in the project. The department said it expects to complete necessary administrative steps to allow reimbursement for eligible project expenditures.
The council processed item 6 (the CDBG amendment/reconciliation) as part of the meeting’s consent items and the transcript records that item 6 “was processed” during the session. Councilors requested that staff follow up with a more complete accounting and said they expect an internal audit of the relevant years’ records to avoid repeat errors.
