Audit 33397

Finding 2022-001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Catalog Numbers: 14.871 Noncompliance ? N. Special Tests and Provisions ? Housing Quality Standards Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: Housing Quality Standards Inspections. The PHA must inspect the unit leased to a family at least annually to determine if the unit meets the 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)). For units that fail inspection the PHA must correct all life threatening HQS deficiencies within 24 hours and all other deficiencies within 30 days. On May 4, 2021, HUD issued Notice PIH 2021-14(HA). In this notice, HUD recognized the unprecedented challenge the COVID-19 pandemic poses to PHAs in carrying out the most essential of their HCV program administrative responsibilities. The notice allowed for the Authority to rely on the owner's certification that the owner has no reasonable basis to have knowledge that life-threatening conditions exist in the unit or units in questions. At minimum, the PHA must require the owner?s certification. However, the PHA may add other requirements or conditions in addition to the owner?s certification, but is not required to do so. The PHA is required to conduct an HQS inspection on the unit as soon as reasonably possible but no later than June 30, 2022. Condition: Based upon inspection of the Authority?s files and on discussion with management there were units that did not have annual inspections or owner?s certifications performed during the audit period. Context: Of a sample size of sixty-five (65) tenant files, the following information was unavailable for examination at the time of audit: ? Annual inspection report or owner's certification documentation was missing in two (2) files. Our sample size is statistically valid. Known Questioned Costs: $41,038 Cause: There is a significant deficiency in internal controls over the compliance for the special tests and provisions type of compliance related to HQS inspections. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance with Notice PIH 2021-14(HA). Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the with the special tests and provisions type of compliance related to HQS inspections. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. deficiencies in the Section 8 Housing Choice Vouchers Program and has implemented internal control procedures in 2022 that will ensure compliance of federal regulations.

Finding 2022-001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Catalog Numbers: 14.871 Noncompliance ? N. Special Tests and Provisions ? Housing Quality Standards Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: Housing Quality Standards Inspections. The PHA must inspect the unit leased to a family at least annually to determine if the unit meets the 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)). For units that fail inspection the PHA must correct all life threatening HQS deficiencies within 24 hours and all other deficiencies within 30 days. On May 4, 2021, HUD issued Notice PIH 2021-14(HA). In this notice, HUD recognized the unprecedented challenge the COVID-19 pandemic poses to PHAs in carrying out the most essential of their HCV program administrative responsibilities. The notice allowed for the Authority to rely on the owner's certification that the owner has no reasonable basis to have knowledge that life-threatening conditions exist in the unit or units in questions. At minimum, the PHA must require the owner?s certification. However, the PHA may add other requirements or conditions in addition to the owner?s certification, but is not required to do so. The PHA is required to conduct an HQS inspection on the unit as soon as reasonably possible but no later than June 30, 2022. Condition: Based upon inspection of the Authority?s files and on discussion with management there were units that did not have annual inspections or owner?s certifications performed during the audit period. Context: Of a sample size of sixty-five (65) tenant files, the following information was unavailable for examination at the time of audit: ? Annual inspection report or owner's certification documentation was missing in two (2) files. Our sample size is statistically valid. Known Questioned Costs: $41,038 Cause: There is a significant deficiency in internal controls over the compliance for the special tests and provisions type of compliance related to HQS inspections. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance with Notice PIH 2021-14(HA). Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the with the special tests and provisions type of compliance related to HQS inspections. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. deficiencies in the Section 8 Housing Choice Vouchers Program and has implemented internal control procedures in 2022 that will ensure compliance of federal regulations.