SALEM — During and after the pandemic, Oregon Housing and Community Services distributed $426 million in emergency rental assistance, but is unable to confirm the funds went to those who needed them and were supposed to receive them.

In a report released Jan. 4, the Oregon Audits Division within the office of the secretary of state found the “OHCS employed limited oversight of the funds and, in its haste, skipped critical controls, including over financial accounting and contract administration.”

This means that $426 million — more than the combined budgets of Umatilla and Morrow counties — was not thoroughly tracked.

Oregon Housing and Community Services distributed emergency rental assistance funds from May 2021 through June 2023.

Although the emergency rental assistance program no longer exists, the audit should still be useful, as Oregon Housing and Community Services is starting an eviction prevention program with a similar approach. The lessons from the pandemic relief distribution audit will benefit the agency’s future programs, even if it can’t fix what happened in this one.

“There is no doubt OHCS, like all of Oregon government, was working under unprecedented emergency conditions during the pandemic,” said Kip Memmott, audits director for the secretary of state’s office, in a press release.

“As auditors, it’s our job to ensure public monies are being spent in accordance with program guidelines and properly accounted for,” he said. “It’s extremely concerning that OHCS is unable to verify whether millions of dollars went to the Oregonians who needed and deserved this money the most.”

LaVonne Griffin-Valade, Oregon secretary of state, also released a statement about the audit.

“The urgency with which OHCS acted to distribute rental assistance during a global crisis is laudable,” she said. “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.”

In Umatilla and Morrow counties, in the beginning, the Community Action Program of East-Central Oregon was responsible for determining eligibility, processing applications and distributing funds.

Eventually, Oregon Housing and Community Services transferred most of that responsibility to an outside group. After that, CAPECO helped renters and landlords in the region with their applications for relief.

There were multiple controls to keep everything on track that housing and community services failed to implement, the report said.

While some of this seems to be attributable to extenuating circumstances of specifically the coronavirus pandemic, there are parts the auditors said are due to standard practices and procedures in the organization.

In particular, the report noted Oregon Housing and Community Services took a reactive planning and response approach. The agency also used poor financial accounting processes and contract administration practices while lacking adequate program staffing and proper oversight.

Without proper internal accounting, there was almost no way for OHCS to determine whether the distributed money was being used in compliance with federal requirements.

Because of the agency’s inadequate monitoring, it’s not known how many people applied and received funds, how many households were helped, nor the final quantity of funds distributed to people who should have received them versus who received them in error.

The audit of the program and response was requested in December 2021 by Rep. Julie Fahey, D-Eugene and Veneta, who is now the House majority leader as well as a member of the House Committee on Housing and Homelessness, and by Sen. Kayse Jama, D-Portland, chair of the Senate Interim Committee on Housing and Development.

“OHCS had an enormous task: quickly getting money out the door to people who desperately needed it due to the economic impacts of the COVID-19 pandemic,” Fahey said in a statement on the report.

“When we called for this audit, thousands of Oregonians were facing eviction — despite money being available to help them — because of unacceptable delays in processing applications,” she said. “State government must often balance speed and accuracy, and I’m hopeful this audit will provide all agencies with tools to more efficiently serve Oregonians in need.”