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									                                                                        FY 2010 OIG Recovery Act Plan Overview
                                                                                             (updated May 2010)
                                       OIG Name: Department of the Treasury, Office of Inspector General


                                                   The overall objectives of the OIG’s oversight of the Recovery Act funds for low-income housing and specified energy property grants in lieu of tax
                                                   credits and the Community Development Institutions Fund are (1) timely and effective implementation of stimulus related activities, (2) proper
                                                   internal control procedures are established and maintained, (3) fund recipients meet eligibility requirements; and (4) fund recipients properly
                                                   comply with award requirements. Since the enactment of the Recovery Act, a new audit division has been established within the OIG to address
                                                   Treasury's Recovery Act activities and four audits are now in progress. Our approach for meeting our overall objectives is to focus on areas of high
                                                   risks and to continually reassess risks to modify our focus and procedures accordingly. We believe this approach will allow us to provide
                                                   accountability and transparency for programs responsible for overseeing an estimated $22 billion of non-IRS Recovery Act funds. Based on our
                                                   reassessment of risks, we continue to focus our Recovery Act work on the specified energy property program and the low income housing
                                                   program as we deem these programs as Treasury's highest risk Recovery Act activities. These programs comprise over $19 billion of Treasury's $22
                                                   billion of non-IRS Recovery Act funds. The estimated cost for the specified energy property program is $16.5 billion over its life (the Recovery Act
                     OIG Broad Recovery Act Goals:
                                                   did not cap program) and as of April 2010, Treasury awarded over $3 billion to reimburse appplicants a portion of the cost for investing in
                                                   renewable energy properties. The low-income housing program increased its original estimate of $2.93 billion to its current awarding of $5 billion
                                                   to state housing credit agencies. Although over $5 billion has been awarded to states under the low-Income housing program, only $685 million
                                                   has been sub-awarded to developers for low-income housing projects. Unlike the CDFI Fund which received additional funds and tax credit
                                                   allowances for existing programs, the specified energy property program and low-income housing program are new programs for the Treasury
                                                   office charged with their administration. That office is thinly staffed and expertise is limited. The CDFI Fund's Core Program and New Market Tax
                                                   Credit Programs are also significant in that the Recovery Act doubled their funding and the CDFI Fund has systemic issues over monitoring awards.
                                                   These programs are still assessed as having moderate risk. Our proactive approach with the CDFI Fund is to keep management apprised of our
                                                   findings for their remediation that we will report on in FY 2010. During FY 2010, we will reassess risk to ensure we are achieving our audit
                                                   objectives.




                                                The OIG has initiated external and internal Recovery Act outreach and training. To this end, the OIG has established liaison and is collaborating externally with
   OIG Broad Training and Outreach Recovery Act the OIGs from the Department of Energy and the Department of Housing and Urban Development to identify and investigate instances of criminal grant fraud.
                                         Goals: Internally, the OIG will increase overall departmental awareness and vigilence toward Recovery Act abuse through integrity awareness briefings within its
                                                bureaus.




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                                                                       FY 2010 OIG Recovery Act Plan Overview
                                                                                            (updated May 2010)


                                                The OIG is taking a number of actions to alert management of risks and recommend cost effective controls to help prevent fraud, waste, and abuse; and ensure
                                                program goals are achieved and stimulus funds are accurately tracked and reported. From continually reassessing risk, we have adjusted our focus on the
                                                programs and areas where risk of fraud, waste, or abuse of federal funds might exist and adjust our procedures accordingly. Treasury is responsible for
                                                overseeing an estimated $22 billion in Recovery Act funds for non-IRS programs with an estimated $19 billion under the control of one program office. We are
                                                very focused on Treasury’s Specified Energy Property and Low-Income Housing grant programs comprising the estimated $19 billion of Recovery Act funds and
      OIG Recovery Act Risk Assessment Process: have assessed these programs as high risk areas for Treasury. Our assessment is based on these programs being new to Treasury and thinly staffed by personnel
                                                with little to no experience in the areas of energy, low-income housing, and tax credits. Our assessment of risk remains the same for these programs which have
                                                awarded more than $8 billion in Recovery Act funds as of April 2010. We assessed CDFI Fund's additional $100 million in funding for the CDFI Fund Program and
                                                additional $3 billion for the New Markets Tax Credit Program as moderate risk since these are established programs with experience in these areas. Although the
                                                CDFI Fund has systemic monitoring issues, the CDFI Fund has hired a new manager to address monitoring. While risk is assessed as moderate, we do plan
                                                significant audit coverage of the CDFI Fund. We will re-assess risk as Recovery Act programs progress.




                         OIG Recovery Act Funds: None provided.
      Expiration Date of OIG Recovery Act Funds: N/A

                                                 NA - At this time, we do not anticipate using contractor support. However, should we later determine that such support is necessary for our oversight work that
  OIG Recovery Act Funds Allocated to Contracts:
                                                 support will be paid for from non-Recovery Act funds.
              Purpose of Recovery Act Contracts: N/A
     Types of Recovery Act Contracts Awarded to
                                                 N/A
                                          Date:

             Link to OIG Recovery Act Work Plan: 0




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                                                                                                        OIG FY 2010 Recovery Act Work Plan
                                                                                                                         (updated May 2010)
                                                                                                                                                                                                                                         Review
                                                                                                                                                                                                                                      Included on   Expected     Expected
                                      Recovery Act Funds                                                                                                                                                                                                                     Expected
                                                                            Entity Performing                                                                                                                                             Prior      Quarter     Quarter(s)
    Agency            Program Area        Associated       Type of Review                            Project Title                          Background                                             Objective                                                                Number of
                                                                                 Review                                                                                                                                                 Recovery      Work        Reports
                                       w/Program Area                                                                                                                                                                                                                         Reports
                                                                                                                                                                                                                                        Act Plan     Begins        Issued
                                                                                                                                                                                                                                          (Y/N)

                                                                                                                        Section 1602 of the Recovery Act requires the
                                                                                                                        Secretary of Treasury to make amounts available       To determine whether Treasury (1) timely and
                                                                                                                        as grants in lieu of tax credits to State housing     effectively implemented the Low-Income Housing
                                                                                                                        credit agency in an amount equal to such state’s      Grants In Lieu of Tax Credits Program activities; (2)
                                                                                                                        low-income housing grant election amount. The         established and maintained proper internal
                    Low-Income                                                                 Audit of Treasury's Low-
 Department of                                                                                                          state agencies, in turn, subaward the funds to        control procedures, including controls to prevent                                  Q3 FY 10 -
                 Housing Grants in $       5,000,000,000    Performance     Treasury OIG Staff Income Housing Grants                                                                                                                     Yes        Q2 FY 09                          15
  the Treasury                                                                                                          qualified parties to partially finance the            subawardees from improperly receiving both tax                                     Q4 FY 15
                 Lieu of Tax Credits                                                           Program
                                                                                                                        construction or acquisition/rehabilitation of low     credits and Recovery Act funds; and (3) assessed
                                                                                                                        income housing. It should be noted that the           whether fund recipients, at both the state the
                                                                                                                        Recovery Act Funds amount is an estimate. The FY      subawardee levels, meet eligibility requirements
                                                                                                                        2009 apportionment for this Program is $2.93          and properly comply with award requirements.
                                                                                                                        billion.

                                                                                                                                                                          To determine whether Treasury (1) timely and
                                                                                                                                                                          effectively implemented the Specified Energy
                                                                                                                                                                          Property Grants in Lieu of Tax Credits Program
                                                                                                                       Section 1603 of the Recovery Act requires the
                                                                                                                                                                          activities; (2) established (and followed)
                                                                                                                       Secretary of Treasury to provide a grant to each
                                                                                                                                                                          appropriate procedures for awarding the grants;
                Specified Energy                                                               Audit of Treasury's     person who places in service, in 2009 or 2010,
 Department of                                                                                                                                                            (3) established and maintained proper internal                                         Q1 FY 10 -
               Property Grants in $       16,455,000,000    Performance     Treasury OIG Staff Specified Energy        specified energy property to reimburse such                                                                       Yes        Q2 FY 09                          10
  the Treasury                                                                                                                                                            control procedures, including controls to prevent                                      Q4 FY 17
               Lieu of Tax Credits                                                             Property Grants Program person for a portion of the expense of such
                                                                                                                                                                          recipients from improperly receiving both tax
                                                                                                                       property. It should be noted that the Recovery Act
                                                                                                                                                                          credits and Recovery Act funds; and (4) assessed
                                                                                                                       Funds amount is an estimate.
                                                                                                                                                                          whether fund recipients meet eligibility
                                                                                                                                                                          requirements and properly comply with award
                                                                                                                                                                          requirements.


                                                                                                                         Title V - Financial Assistance & General
                                                                                                                         Government provides $100 million for the CDFI
                                                                                                                         Fund available until September 30, 2010, to invest
                                                                                                                         in and build the capacity of CDFIs to serve low-
                                                                                                                                                                              To determine whether the CDFI Fund (1) timely
                                                                                                                         income people and communities lacking adequate
                     Community                                                                 Audit of the Community                                                         and effectively implemented the additional
                                                                                                                         access to affordable financial products and
                    Development                                                                Development Financial                                                          appropriation of $100 million for its programs; (2)
 Department of                                                                                                           services. Of this amount, $90 million is for CDFI                                                                                      Q3 FY 10 -
                      Financial       $      100,000,000    Performance     Treasury OIG Staff Institutions Fund's (CDFI                                                      established and maintained proper internal                 Yes        Q2 FY 09                           3
  the Treasury                                                                                                           Fund core programs, $8 million is for programs to                                                                                      Q4 FY 2013
                  Institution Grant                                                            Fund) Additional Grants                                                        control procedures; and (3) assessed whether fund
                                                                                                                         benefit Native American, Native Hawaiian, and
                       Program                                                                 Program                                                                        recipients meet eligibility requirements and
                                                                                                                         Alaskan Native communities, and $2 million for
                                                                                                                                                                              properly complied with award requirements.
                                                                                                                         CDFI Fund administrative expenses. It should be
                                                                                                                         noted that, with respect to the CDFI Fund, the
                                                                                                                         Recovery Act provided additional fund for existing
                                                                                                                         programs.




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                                                                                                              OIG FY 2010 Recovery Act Work Plan
                                                                                                                               (updated May 2010)

                                                                                                                             Section 1403 increased the New Markets Tax
                                                                                                                             Credit limitation for calendar years 2008 and 2009
                                                                                                                             from $3.5 billion per year to $5 billion per year (an
                                                                                                                             increase of $1.5 billion for each year, or $3 billion
                                                                                                                                                                                     To determine whether the CDFI Fund (1) timely
                                                                                                                             total). The additional tax credits are to be
                                                                                                    Audit of the CDFI Fund's                                                         and effectively allocated the additional $3 billion
                                                                                                                             allocated among qualified community
                CDFI Fund New                                                                       Increase to the New                                                              of New Market Tax Credits to eligible recipents
 Department of                                                                                                               development entities. It should be noted that GAO                                                                                    Q13FY 10 -
               Markets Tax Credit $       3,000,000,000       Performance        Treasury OIG Staff Markets Tax Credit                                                               and for eligilbe activities; (2) established and      Yes    Q2 FY 09                               2
  the Treasury                                                                                                               is required by the Community Renewal Tax Relief                                                                                      Q4 FY 2011
                   Program                                                                          Program for 2008 and                                                             maintained proper internal control procedures;
                                                                                                                             Act of 2000 to report on the New Markets Tax
                                                                                                    2009                                                                             and (3) assessed whether recipients complied with
                                                                                                                             Credit program every 3 years with its final report
                                                                                                                                                                                     tax credit requirements.
                                                                                                                             to be issued January 31, 2010. Accordingly, we will
                                                                                                                             coordinate our work with GAO. We will also
                                                                                                                             coordinate our work with the Treasury Inspector
                                                                                                                             General for Tax Administration.




Note: The Treasury OIG's ability to undertake all self-identified planned audits of Treasury Recovery Act program may be impacted by the number and scope of specific, coordinated work requested by the Recovery Accountability and Transparency Board.




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