SALEM, Ore. — Oregon distributed a massive amount of emergency federal funding to aid renters and landlords during the COVID-19 pandemic and resulting unemployment crisis, but a new audit from the Oregon secretary of state's office faults the agency that handled the program for distributing the money unevenly and failing to keep adequate records, making it impossible to confirm that all the funds were spent correctly.
The pandemic-era program was a one-off emergency initiative, but the problems highlighted by the audit are still important to study because they can help guide improvements to other ongoing assistance efforts like the Oregon Eviction Diversion Program and make the state better prepared for future emergencies according to an audit report released Thursday by the secretary of state's office.
The Oregon Housing and Community Services Department ran the state Emergency Rental Assistance program from May 2021 to June 2023 and distributed $426 million in rent assistance during that time, according to the report.
The report acknowledges that the program was newly created and the agency was "under enormous pressure to get millions of dollars out the door as quickly as possible," according to a news release from the secretary of state's office. But the imperative to move fast caused the agency to have less oversight than it should have, without sufficiently rigorous accounting or contract monitoring with on-the-ground partner groups to make sure the money went to the right people.
Fraud was a major concern, according to the news release, with about $37 million in requests denied due to potentially fraudulent applications. The money also came with federal spending guidelines, the report noted, and Oregon could be left on the hook if it can't prove that it followed the distribution rules.
The audit also found that the program itself also had a rocky rollout, with glitchy new software, poor customer service and delays in application processing for both tenants and landlords. OHCS did not have an adequate plan in place for housing emergencies and was overwhelmed by the twin crises of COVID-19 and widespread wildfires in 2020.
In addition to improving its contract monitoring, accounting and program outcome reporting, the audit also recommends that the agency conduct a review of the pandemic assistance program with local partners to better prepare for future emergencies.
"The urgency with which OHCS acted to distribute rental assistance during a global crisis is laudable," Oregon Secretary of State LaVonne Griffin-Valade said in a statement. "As auditors, it’s our job to ensure state agencies properly account for how they spend public money. I encourage OHCS to work speedily to implement the recommendations in this report in preparation for future emergencies."