Federal agency conducts audit on Flint, Michigan, demolition program

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) announced it will conduct an audit of $25.5 million in Flint, Michigan’s costs related to the Hardest Hit Fund, a report by The Detroit News says. The office said it will examine demolition and related costs that were reimbursed with TARP money.

The audit came after SIGTARP issued two subpoenas in May in Detroit for information from the Detroit Land Bank Authority and the city’s Building Authority regarding federally funded contracts and several demolition contractors involved in the city’s blight reduction program, which came under fire in 2015 over concerns with bidding practices and costs. Officials did not say what prompted Flint’s audit.

According to the report, more than 2,000 demolitions have been completed since work began in 2014. The Michigan State Housing Development Authority, which handles the state’s Hardest Hit Fund, has reimbursed Genesee County’s Lank Bank $26.3 million. Two hundred and forty-four properties have been demolished but not yet funded, and another 340 are in process.

In June 2016, SIGTARP issues a report on a national audit of the full blight elimination program, according to the article. Seven state Housing Finance Agencies that were approved for the program, including Alabama, Michigan, Ohio, Illinois, Indiana, South Carolina and Tennessee, were covered in the report.