Audit 25752

Condition: Project management did not complete repairs needed to ensure that units meet housing quality standards, nor performed housing quality inspections at least annually. Context: As part of our audit procedure, we selected 9 units to evaluate housing quality standards. Six selections resulted in HQS Unit Inspections. For two of the six HQS unit inspections, management indicated on the inspection report that the unit was not in decent, safe and sanitary condition. Work orders related to the six HQS unit inspections were still opened and required repairs as documented on the work orders were not completed as of June 30, 2022. For two of the six units, housing quality inspections were not performed at least annually. Criteria: 24 CRF 886.323(a) states that the owner shall maintain and operate the project so as to provide decent, safe, and sanitary housing and the owner shall provide all the services, maintenance, and utilities which he or she agrees to provide under the contract and the lease. Failure to do so shall be considered a material default under the contract and Regulatory Agreement, if any. 24 CRF 882.516 (b) states that in addition to the inspections required prior to execution of the Contract, the PHA must inspect or cause to be inspected each dwelling unit under Contract at least annually and at such other times as may be necessary to assure that the Owner is meeting the obligations to maintain the unit in decent, safe and sanitary condition and to provide the agreed upon utilities and other services. Cause: As a consequence of the Covid-19 pandemic, most of prior year unit inspections were completed in August 2021. Current year unit inspections were completed during the months of February and March of 2022. Employees targeted their efforts on completing emergency repairs on those inspections. Major repairs to units with prolonged vacancy periods were performed during the current year. Effect: 24 CRF 886.323 ( e) states that if HUD notifies the owner that he has failed to maintain a dwelling unit in decent, safe, and sanitary condition, and the owner fails to take corrective action within the time prescribed in the notice, HUD may exercise any of its rights or remedies under the contract, or Regulatory Agreement, if any, including abatement of housing assistance payments (even if the family continues to occupy the unit) and rescission of the sale. Auditor?s recommendation: The project management should implement internal control and procedures to assure that all units under contract be decent, safe and sanitary. Required repairs should be completed timely.

Condition: Project management did not complete repairs needed to ensure that units meet housing quality standards, nor performed housing quality inspections at least annually. Context: As part of our audit procedure, we selected 9 units to evaluate housing quality standards. Six selections resulted in HQS Unit Inspections. For two of the six HQS unit inspections, management indicated on the inspection report that the unit was not in decent, safe and sanitary condition. Work orders related to the six HQS unit inspections were still opened and required repairs as documented on the work orders were not completed as of June 30, 2022. For two of the six units, housing quality inspections were not performed at least annually. Criteria: 24 CRF 886.323(a) states that the owner shall maintain and operate the project so as to provide decent, safe, and sanitary housing and the owner shall provide all the services, maintenance, and utilities which he or she agrees to provide under the contract and the lease. Failure to do so shall be considered a material default under the contract and Regulatory Agreement, if any. 24 CRF 882.516 (b) states that in addition to the inspections required prior to execution of the Contract, the PHA must inspect or cause to be inspected each dwelling unit under Contract at least annually and at such other times as may be necessary to assure that the Owner is meeting the obligations to maintain the unit in decent, safe and sanitary condition and to provide the agreed upon utilities and other services. Cause: As a consequence of the Covid-19 pandemic, most of prior year unit inspections were completed in August 2021. Current year unit inspections were completed during the months of February and March of 2022. Employees targeted their efforts on completing emergency repairs on those inspections. Major repairs to units with prolonged vacancy periods were performed during the current year. Effect: 24 CRF 886.323 ( e) states that if HUD notifies the owner that he has failed to maintain a dwelling unit in decent, safe, and sanitary condition, and the owner fails to take corrective action within the time prescribed in the notice, HUD may exercise any of its rights or remedies under the contract, or Regulatory Agreement, if any, including abatement of housing assistance payments (even if the family continues to occupy the unit) and rescission of the sale. Auditor?s recommendation: The project management should implement internal control and procedures to assure that all units under contract be decent, safe and sanitary. Required repairs should be completed timely.