Disputing the results of the audit in a letter to HUD, Kate Briddell, director of Baltimore's homeless services program, faulted federal officials. "Guidance was negligible, at best," she wrote.

The audit called on the city to demonstrate that the grant money was used properly or reimburse the federal government. The city had contracted with the United Way to manage about 93 percent of the money, or $8.8 million.

Mark Furst, president and CEO of United Way of Central Maryland, said his organization acted as the "fiscal agent" for the grant money, disseminating funds "earmarked to support eviction prevention and rapid re-housing."

"The contract specified that the City was responsible for developing requests for proposals; selecting direct service providers; and monitoring the performance and expenditures of the direct service providers," he said in a statement. The United Way, he said, "performed in full its duties under contract."

The Prisoners Aid Association of Maryland, a defunct organization, could not produce files to show how $392,000 was spent. But a former officer there contends that the city government never delivered some of the money.

"They never gave us all the money we were supposed to get," said Frank H. Marchant, former director of the organization. "We had to close our doors because they wouldn't pay us."

City Councilman Robert W. Curran noted that the audit determined that some organizations, such as the Associated Catholic Charities, had sound accounting practices. But he worried about others. "I'm concerned that some groups didn't use the money as intended," he said.

Lester Davis, a spokesman for City Council President Bernard C. "Jack" Young, said he was "extremely disappointed" by the audit's findings.

"He's going to reach out to a number of individuals for personal explanations about exactly what went wrong and ways to prevent something like that from ever happening again," Davis said.