GAO Releases Report on CDBG-DR Funding

Date Published: 
April 10th, 2019

As part of a Congressional request to review the federal government’s response to the 2017 hurricanes, the Government Accountability Office (GAO) recently released a performance audit report on Community Development Block Grant Disaster Recovery (CDBG-DR) funds that were awarded to Texas, Florida, the U.S. Virgin Islands, and Puerto Rico. The report focuses on the status of these grants, the steps that grantees have taken to establish processes for disbursement and estimating unmet needs, HUD’s process for reviewing the grantees' plans, and challenges faced by HUD and the grantees in grant administration.

In its review of the four grantees’ financial management processes and HUD’s assessment of them, the GAO found flaws primarily in the guidance HUD provided staff to assess grantees’ capacity to oversee the grants and a lack of documentation for HUD’s assessment process. According to the report, HUD has also failed to implement a monitoring plan for the 2017 grants and still needs to conduct workforce planning to ensure sufficient staff capacity within the Disaster Recovery and Special Issues Division.

In addition to HUD’s inability to properly assess grantee capacity and continually monitor grantee performance, the GAO raises issues with the many challenges created for CDBG-DR grantees due to the program’s lack of permanent statutory authority, including: inconsistent grant management and disbursement requirements between notices; frequent delays in accessing funding as HUD moves through the Federal Notice issuance and response process; and lack of coordination between multiple federal agencies. As a result of this complex and slow process, fewer than 1 percent of funds awarded to the 2017 CDBG-DR grantees had been drawn down as of January 2019. Many of these same challenges with the program’s funding lags and varying requirements were experienced by previous CDBG-DR grantees that were previously analyzed by the GAO.

To address these issues, the GAO made several recommendations, the first of which is that Congress make CDBG-DR a permanent program through statutory changes. The GAO’s additional recommendations were addressed to HUD’s Assistant Secretary for Community Planning and Development, which include:

  • Create additional guidance for HUD staff to use in evaluating grantees’ procurement process, financial controls, and grant management
  • Create additional guidance for HUD staff to use in evaluating grantees’ assessments of capacity and unmet needs
  • Require additional documentation from HUD staff in how they evaluated grantees’ procurement process, financial controls, grant management, and capacity and unmet needs assessments
  • Develop and implement a monitoring plan for the 2017 CDBG-DR grants
  • Conduct workforce planning within the Disaster Recovery and Special Issues Division to ensure that division staff have the skills needed to effectively manage these and other disaster grants

HUD partially agreed with two recommendations and agreed with three. Their response stated that guidance for HUD staff on evaluating grantees’ grant administration practices and needs assessment already existed but acknowledged that current guidance could be more thorough. HUD’s full response can be found in Appendix IV of the full report. For questions about the report, contact Senior Research & Policy Analyst Emily Warren at

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