Audit 297428

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). The PHA is required to submit the HUD-50058 form electronically to HUD each time the PHA completes an admission, annual reexamination, interim reexamination, portability move-in, or other change of unit for a family. The PHA must also submit the Family Report when a family ends participation in the program or moves out of the PHA’s jurisdiction under portability (24 CFR Part 908 and 24 CFR section 982.158). Condition/Context: During our testing of 40 files for eligibility requirements, we noted the following in 4 files: - 1 of 40 files tested had a household information form that was not signed/dated by the housing specialist until after the audit sample selections were made. - 2 of 40 files selected were unable to be tested due to the fact that the Authority could not locate the files. - 2 out of 40 files could not be located in the PIC system. The samples were statistically valid samples. Questioned costs: $9,660 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD requirements. Repeat Finding: No Recommendation: We recommend that the Authority review their internal controls over the eligibility requirements to ensure all documentation is maintained at the time of recertification. We recommend the Authority review their internal controls over the HAP process to ensure the correct amounts are paid each month. We recommend the Authority review their process for uploading data to PIC to ensure each recertification gets submitted. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must determine that the rent to the owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition/Context: During our testing of 65 files for reasonable rent requirements, we noted the following in 16 files: - 3 of 65 files were unable to be tested, as the Authority was not able to locate any documentation for the rent determinations. - 5 of 65 files tested had a rent reasonableness determination performed after the effective date - 11 of 65 files tested had an approved reasonable rent that did not agree to the contract rent listed on the HUD-50058 or the contract rent per the HAP Contract/HAP Contract Amendment. The samples were statistically valid samples. Questioned costs: $22,602 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) hroughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with HUD’s reasonable rent requirements. Repeat Finding: No Recommendation: We recommend the Authority review their process over reasonable rent determination to ensure that it is done timely, and that the approved rent is properly carried forward to the HUD-50058 and HAP Contract/HAP Contract Amendment. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023, VA901 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: The PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Authority's Administrative Plan, all units must pass an HQS inspection prior to the approval of a lease and at least once every 12 months during the term of the contract, and at other times as needed, to determine that the unit meets HQS (Chapter 8 of the Admin Plan). Condition/Context: During our testing of 40 files for annual HQS inspection requirements, we noted the following in 5 files: - 5 of 40 files tested had inspections that were not performed annually. During our testing of 25 quality-control inspections, we noted the following in 2 files: - 2 of 25 files tested had a QC inspection that was performed more than 90 days after the initial inspection. The samples were statistically valid samples. Questioned costs: None Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with the HQS requirements set forth in the administrative plan. Repeat Finding: No Recommendation: We recommend the Authority review their processes over annual and qualitycontrol inspections to ensure they are completed timely and in compliance with HUD’s requirements. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Choice Voucher Cluster Assistance Listing Number: 14.871/14.879/14.EHV Federal Award Identification Number and Year: VA901; 2022-2023 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: HQS Enforcement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control reinspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Per the Housing Choice Voucher Program Guidebook and the Authority's administrative plan, QC inspections must be performed on a HQS inspection that is no older than 3 months at the time of reinspection. For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family’s failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations (24 CFR sections 982.158(d) and 982.404). Condition/Context: During our testing of 25 files for HQS enforcement requirements, we noted the following in 6 files: - 5 of 25 files tested had a failed inspection that was not followed up on within the required time frame (either 24 hours or 30 days depending on the severity of the failures). - 6 out of 25 files tested where the Authority failed to process abatements for units that failed on the second inspection. - 5 out of 25 files tested where the Authority failed to enforce the family obligations for units that failed on the second inspection. The samples were statistically valid samples. Questioned costs: $13,701 Cause: As a balance of state PHA, the Authority is responsible for ensuring the Housing Choice Voucher (HCV) program is administered in compliance with Federal regulations across Virginia. The Authority has partnered with 29 local housing agencies (LHAs) throughout the state to administer the program. Due to the number of LHAs there are inconsistencies among agencies on quality control practices. LHA’s differ in size, staffing patterns, geographic service area, and overall capacity to operate the program. In addition to these differences, the Authority and its partner agencies are still recovering from the lingering impacts of COVID-19VHDA S. Staff turnover and retention have contributed to challenges in quality control practices. The Authority has actively worked to improve the HCV Program by taking a methodical approach, making intentional decisions about program improvements while balancing the need to make changes quickly to ensure compliance with federal regulations. Effect: The Authority is not in compliance with their Administrative Plan or HUD’s requirements over HQS enforcement. Repeat Finding: No Recommendation: We recommend the Authority review their process over HQS failed inspections to ensure they are following up timely on correction or properly abating HAP for the unit until correction. Views of responsible officials: There is no disagreement with the audit finding.