FAC Explorer

Audit 300553

FY End
2023-06-30
Total Expended
$76.17M
Findings
2
Programs
11
Organization: Norfolk Redevelopment and Housing Authority (VA)
Year: 2023 Accepted: 2024-03-29
Auditor: Jump Perry and Company LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
389655 2023-001 Significant Deficiency - E
966097 2023-001 Significant Deficiency - E

Programs

ALN Program Spent Major Findings
14.871 Housing Choice Vouchers $43.95M Yes 1
14.850 Public Housing $15.84M - 0
14.889 Choice Neighborhoods Implementation Grants $8.26M - 0
14.872 Public Housing Capital Fund Program $5.81M - 0
14.239 Home Investment Partnership Program $933,581 - 0
14.249 Section 8 Moderate Rehabilitation Single Room Occupancy $385,929 - 0
14.218 Community Development Block Grant $226,999 - 0
14.871 Emergency Housing Vouchers $216,045 Yes 0
14.896 Pih Family Self-Sufficiency Program $207,053 - 0
14.879 Mainstream $203,330 Yes 0
14.870 Resident Opportunity and Support Services $127,826 - 0

Contacts

Name Title Type
F83YEUXGJHB8 Scott Pontz Auditee
7573141667 Donald Jump Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: 1. Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of Norfolk Redevelopment and Housing Authority and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of the Uniform Guidance, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the basic financial statements. 2. Loan Guarantees At June 30, 2023, the Authority is not the guarantor of any loans outstanding, except as discussed in the notes to the financial statements. 3. Indirect Cost Rate The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. The accompanying schedule of expenditures of federal awards includes the federal grant activity of Norfolk Redevelopment and Housing Authority and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of the Uniform Guidance, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the basic financial statements.
Title: Loan Guarantees Accounting Policies: 1. Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of Norfolk Redevelopment and Housing Authority and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of the Uniform Guidance, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the basic financial statements. 2. Loan Guarantees At June 30, 2023, the Authority is not the guarantor of any loans outstanding, except as discussed in the notes to the financial statements. 3. Indirect Cost Rate The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. At June 30, 2023, the Authority is not the guarantor of any loans outstanding, except as discussed in the notes to the financial statements.
Title: Indirect Cost Rate Accounting Policies: 1. Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of Norfolk Redevelopment and Housing Authority and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of the Uniform Guidance, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the basic financial statements. 2. Loan Guarantees At June 30, 2023, the Authority is not the guarantor of any loans outstanding, except as discussed in the notes to the financial statements. 3. Indirect Cost Rate The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance. The Authority has elected not to use the 10% de minimis indirect cost rate allowed under Uniform Guidance.

Finding Details

Finding 2023-001
Criteria In accordance with 24 CFR sections 5.230, 5.609 and 960.259, the PHA must, 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, including third-party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or incomebased rent. Based on those factors, the PHA must determine income eligibility and calculate the tenant's rent payment using the documentation from third party verification. The PHA must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payment as necessary using the documentation from third-party verification. Statement of Condition In our sample of 40 program participants, we noted one instance in which the tenant's annual income was not calculated in accordance with the relevant program requirements. Statement of Cause/Possible Asserted Effect The instances discussed above were the result of the controls to support review of tenant files for required documentation and tenant rent and housing assistance payment calculations not operating effectively. This deficiency in controls resulted in erroneous tenant annual income calculations in all the cases. Reference Number Finding No. 2023-001 Eligibility (continued) Questioned Costs In the first instance, the tenant's annual income was incorrectly calculated.. This resulted in a higher housing assistance payment (HAP) for 4 month. There were no questioned costs associated with this instance. Perspective Information Sampling method- The sample was not intended to be, and was not, a statistically valid sample. Total fiscal year 2023 HAP expenditures associated with the 40 program participants tested in our sample was approximately $406,404. The total population of HAP payments made during FY 2023 was approximately 41.0 million. Identification of Repeat Findings This finding is a repeat of a finding in fiscal year 2021, Reference Number 2021-001 Eligibility. That finding was not corrected in 2022. Recommendation The Authority should strengthen controls over its review processes regarding tenant eligibility and rent determinations, including that the correct information is used to determine rent amounts. We recommend that the Authority implement a secondary review procedure of annual recertifications for tenant files. Views of Responsible Officials Management agrees with this finding.
Finding 2023-001
Criteria In accordance with 24 CFR sections 5.230, 5.609 and 960.259, the PHA must, 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, including third-party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or incomebased rent. Based on those factors, the PHA must determine income eligibility and calculate the tenant's rent payment using the documentation from third party verification. The PHA must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payment as necessary using the documentation from third-party verification. Statement of Condition In our sample of 40 program participants, we noted one instance in which the tenant's annual income was not calculated in accordance with the relevant program requirements. Statement of Cause/Possible Asserted Effect The instances discussed above were the result of the controls to support review of tenant files for required documentation and tenant rent and housing assistance payment calculations not operating effectively. This deficiency in controls resulted in erroneous tenant annual income calculations in all the cases. Reference Number Finding No. 2023-001 Eligibility (continued) Questioned Costs In the first instance, the tenant's annual income was incorrectly calculated.. This resulted in a higher housing assistance payment (HAP) for 4 month. There were no questioned costs associated with this instance. Perspective Information Sampling method- The sample was not intended to be, and was not, a statistically valid sample. Total fiscal year 2023 HAP expenditures associated with the 40 program participants tested in our sample was approximately $406,404. The total population of HAP payments made during FY 2023 was approximately 41.0 million. Identification of Repeat Findings This finding is a repeat of a finding in fiscal year 2021, Reference Number 2021-001 Eligibility. That finding was not corrected in 2022. Recommendation The Authority should strengthen controls over its review processes regarding tenant eligibility and rent determinations, including that the correct information is used to determine rent amounts. We recommend that the Authority implement a secondary review procedure of annual recertifications for tenant files. Views of Responsible Officials Management agrees with this finding.