Date Issued: January 3, 2003
Audit Memorandum No.: 2003-CH-1007
File Size: 6720KB

Title: City of Minneapolis Empowerment Zone Program 
Minneapolis, Minnesota
HUD's Office of Inspector General completed an audit 
of the City of Minneapolis� Empowerment Zone Program. 
The objectives of our audit were to determine whether 
the City: (1) efficiently and effectively used Empowerment 
Zone funds; and (2) accurately reported the accomplishments 
of its Empowerment Zone Program to HUD. The audit was part 
of our Fiscal Year 2002 Annual Audit Plan. The audit was 
conducted based upon our survey results and two requests 
from Congress.

The United States House of Representatives� 
Conference Report 107-272 directed HUD�s Office of Inspector General 
to review the use of Empowerment Zone funds and to report 
our findings to the Senate Appropriations Committee. 
The United States Senate�s Report 107-43 also requested 
us to review the use of Zone funds and report 
our audit results to Congress.

We concluded that the City did not accurately report the 
accomplishments of its Empowerment Zone Program to HUD and 
needs to improve its oversight of Empowerment Zone funds. 
Specifically, the accomplishments of the City�s Empowerment 
Zone projects were inaccurately reported to HUD and the 
City inappropriately used $9,705 of Empowerment Zone funds 
to pay expenses not related to its Near North Planning and 
Development project. We also found that the City used 
Empowerment Zone monies to fund seven projects that have 
not provided benefits to Empowerment Zone residents or 
benefited only 3 to 38 percent of Zone residents as of 
June 2002. Five of the seven projects are scheduled for 
completion between December 2003 and December 2011, and 
the remaining two projects were completed between 
December 2001 and July 2002.

We recommend that HUD�s Director of Renewal 
Communities/Empowerment Zones/Enterprise Communities Initiative 
assure that the City of Minneapolis reimburses its Near North 
Planning and Development project from Empowerment Zone 
Administration funds for the inappropriate use of Zone 
funds and implements controls to correct the weaknesses 
cited in this report.

http://www.hud.gov/oig/ig351007.pdf (Full Report)

Posted by Shawn Lewis, Field Neighborhood




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