Anchorage Health Department CDBG audit finds penalties never enforced, goals missed

An internal audit released in June found the Anchorage Health Department did not enforce penalties against subrecipients who failed to meet federal Community Development Block Grant project goals. The audit appeared on the Anchorage Assembly agenda for its July 7, 2026 meeting, the same evening members were asked to approve a new $750,000 CDBG grant for True North Recovery to acquire a public facility and to adopt the city's 2026 Annual Action Plan.

Audit Findings

Auditors sampled six subrecipients and found four failed to meet project goals. One mobile home repair contractor completed one of 20 required units in 2025. The audit found 95 of 101 reporting requirements from January 2023 through March 2026 were not followed, with 22 reports never submitted at all. HUD had separately flagged a skipped public hearing for the 2024 Annual Action Plan. In total, auditors identified nine findings covering subrecipient goal-setting, penalty enforcement, expired agreements, undocumented prior procurement processes, missing required agreement language, and missing supplemental documentation.

Corrective Deadline and Pending Action

Management concurred with each finding. The Community Safety and Development program plans to finalize and implement documented corrective procedures no later than August 1, 2026, according to the audit. The Assembly was simultaneously asked to adopt the 2026 Annual Action Plan, which appropriates $1,788,314 in CDBG entitlement funds, $616,173 in HOME funds, and $166,990 in Emergency Solutions Grant funds, totaling more than $2.5 million, all managed by the same department.