By Luis Monteagudo Jr. UNION-TRIBUNE STAFF WRITER April 25, 2001

A county audit has detailed mismanagement in a housing program for low-income people.

Problems within the county Housing and Community Development Department were first reported by The San Diego Union-Tribune in February. The audit, obtained under the California Public Records Act, confirms a pattern of duplicate payments and other trouble the department had in administering federal housing funds.

County officials said they are enacting measures to improve the program.

The audit turned up problems in 13 areas of the Section 8 program run by the Housing and Community Development Department. The problems included incorrect rent checks, lack of staff training and inadequate internal controls.

The formal audit was done at the request of Alex Martinez, a top administrator who oversees the department, after he was informed by county auditors of difficulties they encountered when seeking routine financial information about the Section 8 program.

Called a management review by the county, the audit focused on that program, which sends checks totaling $40 million annually to pay the rent for 8,000 families living in unincorporated areas and in Chula Vista, Coronado, Del Mar, El Cajon, Escondido, Imperial Beach, La Mesa, Lemon Grove, Poway, San Marcos, Santee, Solana Beach and Vista.

The checks, which range from $200 to $1,000 per family, are financed by the Federal Housing and Urban Development Department. About 2,500 landlords participate in the program.

Among the audit's key findings are that many of the problems result from an inadequate computer software system called CHAMPIONS that the department purchased to manage the Section 8 program.

Department managers installed the system in September 1999, even though it "had been experiencing known functionality problems during the testing mode," the audit said.

It says county managers failed to specify the necessary requirements for the software, leaving the vendor with an incomplete understanding of what the software was supposed to accomplish.

The document says the software's flaws led to overpayments to landlords. In some cases, checks for the correct amount were issued, but more than one check was mailed. It also found that monthly monitoring of the Section 8 program's expenses did not occur.

The audit does not specify the magnitude of the financial errors. But in an interview Monday, Martinez said about $170,000 in duplicate payments were sent. About $93,000 has been recovered, and the county is working to get the rest of the money back.

Meanwhile, the department is implementing 18 measures to address the criticisms cited in the audit.

They included training staff on federal rules regarding the Section 8 program, having outside auditors review the computer system's records for the past two years, assessing whether more staff should be hired for the program, recruiting new landlords and replacing the $500,000 CHAMPIONS computer system. A new system, which cost an additional $500,000, is expected to be installed by July 30.

Martinez said the measures will ensure that the problems do not occur again.

The audit does not assign specific blame. The department's former director, Edward Baker, resigned in February while the audit was being completed.

A national search for a director is expected to be completed by June. County Registrar of Voters Mikel Haas is temporarily running the department.

http://www.uniontrib.com/news/metro/20010425-9999_7m25housing.html

-- Doris (nocents@bellsouth.net), April 26, 2001