Audit: Money misspent on stipends, unapproved expenses

Last updated: June 18. 2014 10:17AM - 14239 Views
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PEMBROKE — A federal audit has determined that the Lumbee Tribe of North Carolina must repay more than $450,000 in U.S. Department of Housing and Urban Development money it inappropriately spent for stipends for council members, legal fees, gasoline and powwow-related expenses.


According to to The Fayetteville Observer, grant specialists from HUD conducted an on-site review in August and determined that the tribe had inappropriately spent $454,972.73 of Indian Housing Block Grant Funds, a grant that is meant to provide housing assistance for poor American Indian families. No deadline was given in the audit for when the money must be repaid.


No one from the tribal administration could be reached for comment.


The audit outlines five statutory violations requiring corrective action — one of which has already been corrected — and cites two areas that are not violations but should be addressed so they are not repeated.


Unallowable expenses related to council stipends were found to total $416,562.67 from Oct. 1, 2010, to Aug. 30, 2013, the newspaper said. At one point the stipends were increased from $250 to $550 a month.


The Fayetteville Observer cites the report as saying the stipends are “far in excess of the $50 per meeting recommended by Program Guidance. The tribe reportedly responded by pointing to previous HUD audits that did not questioning the stipends.


The newspaper also cited the audit as determining the tribe did not comply with full and open competition when soliciting bids for legal service, and contracted with attorney Edward Brooks without soliciting bids. Brooks received three checks from the tribe totaling $31,596.93 for legal fees from April 3, 2013, to June 28, 2013.


According to the newspaper, the audit charges that the tribe used $6,608.04 of federal money to pay for powwow expenses that included food, hotel airfare and performances. It was also found during the audit that the council had approved resolutions authorizing housing money to pay for powwows in 2012, and also to be spent for the 2012 T-shirt design for a powwow.


The audit also reportedly found $205 in improper gasoline expenses charged by Paul Brooks, the tribe’s chairman. It was determined that the chairman made three charges after regular work hours and on weekends and could not produce a log for use of a housing department vehicle that supposedly was used for housing-related matters.


A fifth finding was addressed and already closed, according to the audit. The Fayetteville Observer said that audit finding was related to the tribe not receiving adequate information from the Eagles Nest Apartment Complex in Fayetteville.


According to the newspaper, the two areas of concern listed in the audit are the tribe’s failure to meet maintenance completion deadlines and complete a self-monitoring report. HUD determined that work orders were not responded to in a timely manner, and that the tribe’s self-monitoring reports — that can be useful in providing information to governing bodies and funding sources about tribal programs — were incomplete.

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