LINCOLN — A legislative audit released Friday raised concerns about how the Department of Economic Development has managed the state's Affordable Housing Trust Fund.
According to the audit report, the department did not adequately track money building up in the fund, which allowed it to accumulate an $11 million unused balance.
In addition, the report said, the department has not required a 10 percent match from all housing grant recipients as state law requires. State Sen. John Kuehn of Heartwell, the chairman of the Legislative Performance Audit Committee, said the committee was concerned about the audit findings.
But he expressed confidence that the department is working to fix the problems found.
In particular, he noted that the department is working with lawmakers on a plan for making use of the fund balance to provide workforce housing in labor-short rural areas.
Legislative Bill 518 would create a matching grant program using a one-time $10 million transfer from the Affordable Housing fund. The measure has been named a priority by the Business and Labor Committee.
Courtney Dentlinger, the department director, agreed that the fund balance was larger than was needed.
She said the department is working on ways to better track the fund balance, so it does not build up as much.
The department is reorganizing to allow for the hiring of a chief legal officer, chief financial officer, budget officer and internal auditor, she said.
On the issue of matching funds, Dentlinger initially said nonprofit entities did not have to provide a match. But she changed her position after talking with legislative audit staff about the requirements of state law.
The legislative report recommended that DED review the laws and regulations governing the housing fund.
The affordable housing fund was created in 1996 to help address a severe shortage of housing for low and moderate-income Nebraskans, particularly in rural communities.
The fund receives a portion of the real estate transfer tax assessed on every real estate transaction in Nebraska.