Notice of Recoupment OIG-CA-25-055 — ERA1, City of Moreno Valley, California (Treasury OIG)
Summary
A Notice of Recoupment memorandum, OIG-CA-25-055, dated August 18, 2025, from the Department of the Treasury Office of Inspector General to the Acting Chief Program Officer of the Office of Capital Access, concerning the Emergency Rental Assistance Program (ERA1) grantee City of Moreno Valley, California. It sets out the use-of-funds and recoupment provisions of 15 U.S.C. § 9058a. OIG states that of four cases reported by subrecipient Inland Southern California 211, two rental arrears payments of $9,475 and $7,500, totaling $16,975, failed to comply with 15 U.S.C. § 9058a(c). The memorandum reports that Moreno Valley repaid the $16,975 to Treasury on December 10, 2024, as part of a $28,889.00 payment, and that OIG therefore makes no recommendation.
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DEP A RTMENT OF THE TRE A SUR Y
WASH INGTON , D.C. 20220
OFFICE OF
INSP ECTOR GENERAL
August 18, 2025
OIG-CA-25-055
MEMORANDUM FOR JEFFREY W. STOUT
ACTING CHIEF PROGRAM OFFICER, OFFICE OF CAPITAL
ACCESS
FROM: Marla A. Freedman /s/
Executive Advisor, Office of Audit
and
Robert A . Taylo r, J r. /s/
Executive Advisor, Office of Audit
SUBJECT: Emergency Re nta l Assista nce Program (ERA 1) - Notice of
Recoupment, City of Moreno Val ley, California
In December 2022 and August 2023, the Depa rtment of the Treasury's (Treasury)
Office of Inspector General (OIG) received reports from Inland Southern California
211 (ISC 211 ), 1 a subrecipient of t he City of Moreno Valley, California (Moreno
Va lley), about four cases of potential improper payments made with Emergency
Rental Assista nce (ERA 1)2 award funds by t he ERA 1 grantee, the City of Moreno
Va lley (Moreno Va lley). Based on our inquiry of ISC211 and Moreno Va lley and
review of documentation provided, we determ ined that the payments for two
cases were eligi ble and the payments for the other two cases, totali ng $16,975,
fai led to comply with t he Use of Funds requirements in the ERA 1 statute.3
Moreno Va lley informed us that as instru cted by Treasury and OIG in a Joint
Notice issued on October 4, 2024, 4 they repaid t he $16,975, as part of a $28,889
payment, to Treasury o n December 10, 2024, from city funds. Moreno Va lley's
1 ISC211 is a subsidiary of Inland Southern California United Way.
2 The ERA 1 prog ram is authorized by Division N, Title V, Subtitle A, § 501 of t he Consolidated
Appropriations Act, 2021 (Pub. L. No. 116-260), Dec. 27, 2020, and codified at 15 U .S.C. § 9058a .
3 15 U .S.C. § 9058a(c).
4
The Joint Not ice was issued as a reminder to all ERA financial assistance awa rd recipients of
responsibilities and requi rements for report ing fraud and reimbursing fraud losses and
unallowable costs from non-ERA f unds. The Joi nt Notice is available on OIG's website at
https://o ig.treasu ry .gov/system/files/2024-10/ERA-Joint-Treasury-OIG-Notice.pdf and Treasury's
website at https://home.treasu ry .gov/system/fi les/ 136/ ERA-Joi nt-T reasu ry -OIG-Notice.docx.
1
response and action addressed our recoupment finding. Accordingly, we make no
recommendation in this memorandum.
Background/Legal Authority
Under the ERA1 statute at 15 U.S.C. § 9058a(c), Use of Funds, an eligible grantee
shall only use ERA1 award funds to provide financial assistance and housing
stability services to eligible households. The financial assistance includes: the
payment of rent; rent arrears; utilities and home energy costs; utilities and home
energy costs arrears; and other expenses related to housing incurred due, directly
or indirectly, to the COVID-19 outbreak, as defined by the Secretary of the
Department of the Treasury (Treasury). Such assistance shall be provided for a
period not to exceed 12 months except that grantees may provide assistance for
an additional 3 months to ensure housing stability (subject to availability of
funds). The ERA1 statute at 15 U.S.C. § 9058a(c)(2)(B)(i) allows for up to 3 months
(with exceptions) for prospective rent payments within the 12 or 15 months total
assistance limitation.
The ERA1 statute at 15 U.S.C. § 9058a(k)(3)(A) defines eligible household as a
household of one or more individuals who are obligated to pay rent on a
residential dwelling and with respect to which the eligible grantee involved
determines that (1) one or more individuals within the household has (a) qualified
for unemployment benefits or (b) experienced a reduction in household income,
incurred significant costs, or experienced other financial hardship due, directly or
indirectly, to the COVID-19 outbreak, which the applicant shall attest in writing;
(2) that one or more individuals within the household can demonstrate a risk of
experiencing homelessness or housing instability, which may include, (a) a past
due utility or rent notice or eviction notice; (b) unsafe or unhealthy living
conditions; or (c) any other evidence of such risk, as determined by the eligible
grantee involved; and (3) the household has a household income that is not more
than 80 percent of the area median income for the household.
In accordance with the ERA1 statute at 15 U.S. C. § 9058a(k)(3)(B), the grantee
must also ensure that, to the extent feasible, any rental assistance provided to an
eligible household is not duplicative of any other federally funded rental
assistance provided to such household.
Pursuant to the ERA1 statute at 15 U.S.C. § 9058a(e)(2), the last day of the period
of performance for grantees that received ERA1 reallocated funds is December 29,
2022.
The ERA1 statute at 15 U.S.C. § 9058a(i) Inspector General Oversight;
Recoupment, directs that the Treasury Office of Inspector General (OIG) conduct
monitoring and oversight of the receipt, disbursement, and use of funds made
available under the ERA1 program. As part of this authority, if OIG determines
that a grantee failed to comply with the use of funds requirements in the ERA1
2
statute (15 U.S.C. § 9058a(c)), the amount equal to the amount of funds used in
violation of 15 U.S.C. § 9058a(c) shall be booked as a debt of such entity owed to
the Federal Government.
Facts and Analysis
In December 2022 and August 2023, we received reports from ISC 211, a
subrecipient of Moreno Valley, about four cases of improper payments made with
ERA1 funds awarded to Moreno Valley. ISC211 explained they detected the
ineligible payments were made as they performed secondary (post-payment)
reviews. We agreed with ISC211’s conclusions on two of the four cases as
follows: 5
1. For application #(b) (6) , ISC211 determined that the applicant used a
deceased person’s information to collect ERA1 assistance. ISC211 paid
ERA1 assistance based on an application that lacked valid documentation to
establish eligibility and therefore ISC211 cannot establish an eligible use of
funds. Accordingly, we determined the rental arrears paid, in the amount of
$9,475, is an ineligible ERA1 expenditure that failed to comply with the
ERA1 statute.
2. For application #(b) (6) , ISC211 determined that the applicant used a
deceased person’s information to collect ERA1 assistance. ISC211 paid
ERA1 assistance based on an application that lacked valid documentation to
establish eligibility and therefore ISC211 cannot establish an eligible use of
funds. Accordingly, we determined that the rental arrears paid, in the
amount of $7,500, is an ineligible ERA1 expenditure that failed to comply
with the ERA1 statute.
Based on the information provided, we determined that Moreno Valley, through
its subrecipient, ISC211, failed to comply with the use of funds requirements in
the ERA1 statute (15 U.S.C. § 9058a(c)) when it paid out ERA1 award funds
totaling $16,975 to ineligible households.
Moreno Valley Response
We provided Moreno Valley with an opportunity to respond to a draft of this
recoupment finding. In an email response dated April 7, 2025, Moreno Valley
stated they repaid Treasury a total of $16,975 on December 10, 2024, for the two
applications which were found to be fraudulent. In a follow-up inquiry to its
response, a Moreno Valley official informed us that the funds were repaid in
response to the Joint Notice.
5
ISC211 provided additional support that two cases were in fact eligible payments and had been
reported in error.
3
OIG Evaluation
Moreno Valley’s response and action addressed our recoupment finding. We
reviewed documents provided by Moreno Valley that showed the repayment was
submitted through Treasury’s Pay.gov system. 6 Accordingly, we make no
recommendation in this memorandum.
We also provided Treasury with an opportunity to review a draft of this
memorandum. In an email dated August 1, 2025, Treasury stated that it agreed
with OIG that any improper use of ERA1funds should be reimbursed, and that
Treasury received funds from Moreno Valley on December 10, 2024, for ERA1.
Methodology
We conducted our review of these cases from December 2022 to April 2025. We
inquired of the grantee and other relevant parties, reviewed related
documentation, and performed other appropriate procedures. We believe the
evidence obtained is sufficient and appropriate to provide a reasonable basis for
our findings and conclusions in this Notice.
In conducting our review, we followed the OIG’s quality control procedures for
ensuring that the information in this report is accurate and supported.
Additionally, CIGIE’s Quality Standards for Federal Offices of Inspector General
require that our work adheres to its general standard for integrity and related
elements of integrity, objectivity, confidentiality, independence, and professional
judgment, and to its general standard for receiving and reviewing allegations. We
adhered to these standards in performing our work.
6
The documentation we reviewed showed that Moreno Valley paid Treasury a total of $28,889.00
on December 10, 2024, for the two ineligible payments that were the subject of this Notice of
Recoupment ($9,475 and $7,500, respectively) and other identified ERA1 “actual fraud/other
unallowed cost” amounts.
4
Distribution
Department of the Treasury
Jeffrey W. Stout, Acting Chief Program Officer, Office of Capital Access
Danielle Christensen, Deputy Chief Program Officer for State & Local
Programs, Office of Capital Access
Kendra N. Young-Freeman, Director, Housing Programs, Office of Capital
Access
Michelle Dickerman, Deputy Assistant General Counsel, Office of the
General Counsel
Carolyn Appel, Attorney-Advisor, Office of the General Counsel
Blossom Butcher-Sumner, Attorney-Advisor, Office of the General Counsel
City of Moreno Valley, Financial and Management Services
Inland Southern California 211
5
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- Original
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