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Audit Finds Room for Improvement at Department of Community Affairs

Problems with inspections and check deposits not as serious as those uncovered in earlier audits, particularly with DCA weatherization program

audit paper tape

The New Jersey Department of Community Affairs has been faulted once again in a state audit -- this time for a backlog in inspections of boarding homes and other facilities and for failing to deposit checks to a few of its divisions in a timely manner.

The audit --- the latest by the Office of the State Auditor -- was far less critical of the agency than previous reports. Those detailed more extensive problems with the department’s fiscal oversight of its weatherization program, which tries to lower utility bills for residents by making their homes more energy efficient.

The latest audit, dealing with the agency’s Divisions of Fire Safety (DFS) and Codes and Standards (DCS), found financial transactions by the programs were reasonable and recorded properly. Overall, inspections were done properly in a timely manner, according to the audit.

Still, it found a backlog of various required inspections in the Division of Codes and Standards, which are required annually. Nineteen percent (147 of the 757) of boarding homes had not had a physical inspection performed within 13 months.

In addition, 11 percent of homeless shelters did not have a physical or other inspection within 13 months, the audit said. Nine of the 77 resident healthcare facilities did not have inspections within 13 months, according to the audit.

Finally, the audit found that the division failed to inspect all small liquefied petroleum gas (LPG) facilities annually. Its review found that 153 of the 873 LPG had not been inspected in calendar year 2013; 79 had not been inspected in calendar year 2012.

“Small LPG tanks that are not inspected annually can result in unsafe working conditions and could be a danger to individuals in the vicinity of the tanks,’’ the audit said.

DCA officials said that lack of resources and increased staff responsibilities have contributed to the various backlogs. The audit recommended the division prioritize its resources to reduce the problem.

In response, the DCA said that it ensures that situations that could affect public safety are inspected timely and thoroughly. It also said it has taken proactive steps to address the backlog, including hiring additional staff.

Beyond the backlogs, the audit found the divisions have not deposited checks in a timely manner. Department of Treasury directives require agencies to ensure that all state funds are deposited the same day as received, according to the audit.

That was the exception rather than the rule. In a random review of checks from both divisions, the audit discovered that it sometimes took a lot longer. For the DCS, the checks, on average, were deposited six business days after receipt (and up to 21 business days after receipt). For the DFS, the average time it took to deposit checks was 21 days after receipt (and up to 64 business days after receipt), according to the audit.

The DFS has begun using an automated electronic system that allows all revenue to be sent to the Treasury Department via mail or by electronic payment, but it still receives 100 to 200 checks a week from payers transitioning to the new process, the audit said.

In response, the department cited its efforts to implement the automated system, but noted that both divisions will evaluate the adequacy of their procedures and attempt to dedicate additional resources to this area, if necessary.

Finally, the audit found that the DCS has not written off doubtful accounts in a timely manner. As of July 30, 2013, it had $33.5 million owed to it that was considered uncollectible -- some for as long as 30 years.

The agency said it is working with the Treasury Department to reduce the amount of uncollectible debt on its books.

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