Finding 2024-001: Tenant Eligibility - Material Weakness - Material Noncompliance
Repeat of prior year findings: 2021-001, 2022-002, and 2023-001
Assistance Listing Number: 14.181
Federal Agency: U.S. Department of Housing and Urban Development
Federal Award Number: Not applicable
Federal Award Year: July 1, 2023 - June 30, 2024
Pass-Through Entity: Not applicable
Criteria: Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living
together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR Section 891.505).
Residents must also qualify as very low-income households to be eligible (42 USC 8013). Eligibility is only determined at move-in or at initial certification except in circumstances whereas family composition changes after initial occupancy a determination must be made as to whether the
remaining member of the household will be eligible to receive assistance. Eligibility requirements are found in HUD's regulations at 24 CFR Part 5.
The Corporation is responsible for annually reexamining incomes of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR Section 891.410). Assistance applicants shall submit signed consent forms upon initial application and at reexamination (24 CFR Section 5.230).
Questioned Cost: Not determinable.
Condition/Context: During our risk assessment procedures and follow-up on the prior year findings, we noted that the tenant eligibility issues that were identified in the prior years persisted. The issues affecting tenant eligibility include missing documentation to support the eligibility requirements and tenant recertification. As a result, we did not select a sample from the population for testing.
Effect: Insufficient documentation of tenant eligibility and late recertifications. As a result of untimely recertifications, cash collections has been delayed by HUD causing operating cash flow deficiencies resulting in significant growth in related party balances due to the parent entity and unpaid subsidies at June 30, 2024.
Cause: Lack of management oversight due to turnover. As a result, management has not been able to implement their planned corrective actions in a timely fashion.
Recommendation: The Corporation should have procedures in place to ensure documentation is maintained accordance with its requirements.
Views of Responsible Officials and Planned Corrective Actions: Staffing turnover limited ability for portfolio property managers to effectively manage tenant files at each building location. Historically, the management and auditing of tenant files was entirely under the process flows for property management team. The Inglis Compliance department is now sampling and reviewing tenant files to assure tenant files are accurate and audit ready at any given time. The tenant files for all entities will be current by December 2024.
Inglis Housing Corporation hired new a new property management Executive Director in August 2024. Under her leadership the team has made extensive progress updating and bringing all PRACs, tenant recertifications, and tenant files into compliance. There has been in depth training for the property management team on the usage of a newly implemented property management system. All staff have or will attend external training classes for tax credit and HUD property management functions. The property management team is working on reviewing and updating all tenant files with a goal of being in compliance for the June 30, 2025 audit. Extensive process has been made as of October 2024. All of the HUD entities managed by the property management team are current through June 2024.
Finding 2024-001: Tenant Eligibility - Material Weakness - Material Noncompliance
Repeat of prior year findings: 2021-001, 2022-002, and 2023-001
Assistance Listing Number: 14.181
Federal Agency: U.S. Department of Housing and Urban Development
Federal Award Number: Not applicable
Federal Award Year: July 1, 2023 - June 30, 2024
Pass-Through Entity: Not applicable
Criteria: Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living
together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR Section 891.505).
Residents must also qualify as very low-income households to be eligible (42 USC 8013). Eligibility is only determined at move-in or at initial certification except in circumstances whereas family composition changes after initial occupancy a determination must be made as to whether the
remaining member of the household will be eligible to receive assistance. Eligibility requirements are found in HUD's regulations at 24 CFR Part 5.
The Corporation is responsible for annually reexamining incomes of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR Section 891.410). Assistance applicants shall submit signed consent forms upon initial application and at reexamination (24 CFR Section 5.230).
Questioned Cost: Not determinable.
Condition/Context: During our risk assessment procedures and follow-up on the prior year findings, we noted that the tenant eligibility issues that were identified in the prior years persisted. The issues affecting tenant eligibility include missing documentation to support the eligibility requirements and tenant recertification. As a result, we did not select a sample from the population for testing.
Effect: Insufficient documentation of tenant eligibility and late recertifications. As a result of untimely recertifications, cash collections has been delayed by HUD causing operating cash flow deficiencies resulting in significant growth in related party balances due to the parent entity and unpaid subsidies at June 30, 2024.
Cause: Lack of management oversight due to turnover. As a result, management has not been able to implement their planned corrective actions in a timely fashion.
Recommendation: The Corporation should have procedures in place to ensure documentation is maintained accordance with its requirements.
Views of Responsible Officials and Planned Corrective Actions: Staffing turnover limited ability for portfolio property managers to effectively manage tenant files at each building location. Historically, the management and auditing of tenant files was entirely under the process flows for property management team. The Inglis Compliance department is now sampling and reviewing tenant files to assure tenant files are accurate and audit ready at any given time. The tenant files for all entities will be current by December 2024.
Inglis Housing Corporation hired new a new property management Executive Director in August 2024. Under her leadership the team has made extensive progress updating and bringing all PRACs, tenant recertifications, and tenant files into compliance. There has been in depth training for the property management team on the usage of a newly implemented property management system. All staff have or will attend external training classes for tax credit and HUD property management functions. The property management team is working on reviewing and updating all tenant files with a goal of being in compliance for the June 30, 2025 audit. Extensive process has been made as of October 2024. All of the HUD entities managed by the property management team are current through June 2024.
Finding 2024-001: Tenant Eligibility - Material Weakness - Material Noncompliance
Repeat of prior year findings: 2021-001, 2022-002, and 2023-001
Assistance Listing Number: 14.181
Federal Agency: U.S. Department of Housing and Urban Development
Federal Award Number: Not applicable
Federal Award Year: July 1, 2023 - June 30, 2024
Pass-Through Entity: Not applicable
Criteria: Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living
together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR Section 891.505).
Residents must also qualify as very low-income households to be eligible (42 USC 8013). Eligibility is only determined at move-in or at initial certification except in circumstances whereas family composition changes after initial occupancy a determination must be made as to whether the
remaining member of the household will be eligible to receive assistance. Eligibility requirements are found in HUD's regulations at 24 CFR Part 5.
The Corporation is responsible for annually reexamining incomes of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR Section 891.410). Assistance applicants shall submit signed consent forms upon initial application and at reexamination (24 CFR Section 5.230).
Questioned Cost: Not determinable.
Condition/Context: During our risk assessment procedures and follow-up on the prior year findings, we noted that the tenant eligibility issues that were identified in the prior years persisted. The issues affecting tenant eligibility include missing documentation to support the eligibility requirements and tenant recertification. As a result, we did not select a sample from the population for testing.
Effect: Insufficient documentation of tenant eligibility and late recertifications. As a result of untimely recertifications, cash collections has been delayed by HUD causing operating cash flow deficiencies resulting in significant growth in related party balances due to the parent entity and unpaid subsidies at June 30, 2024.
Cause: Lack of management oversight due to turnover. As a result, management has not been able to implement their planned corrective actions in a timely fashion.
Recommendation: The Corporation should have procedures in place to ensure documentation is maintained accordance with its requirements.
Views of Responsible Officials and Planned Corrective Actions: Staffing turnover limited ability for portfolio property managers to effectively manage tenant files at each building location. Historically, the management and auditing of tenant files was entirely under the process flows for property management team. The Inglis Compliance department is now sampling and reviewing tenant files to assure tenant files are accurate and audit ready at any given time. The tenant files for all entities will be current by December 2024.
Inglis Housing Corporation hired new a new property management Executive Director in August 2024. Under her leadership the team has made extensive progress updating and bringing all PRACs, tenant recertifications, and tenant files into compliance. There has been in depth training for the property management team on the usage of a newly implemented property management system. All staff have or will attend external training classes for tax credit and HUD property management functions. The property management team is working on reviewing and updating all tenant files with a goal of being in compliance for the June 30, 2025 audit. Extensive process has been made as of October 2024. All of the HUD entities managed by the property management team are current through June 2024.
Finding 2024-001: Tenant Eligibility - Material Weakness - Material Noncompliance
Repeat of prior year findings: 2021-001, 2022-002, and 2023-001
Assistance Listing Number: 14.181
Federal Agency: U.S. Department of Housing and Urban Development
Federal Award Number: Not applicable
Federal Award Year: July 1, 2023 - June 30, 2024
Pass-Through Entity: Not applicable
Criteria: Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living
together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR Section 891.505).
Residents must also qualify as very low-income households to be eligible (42 USC 8013). Eligibility is only determined at move-in or at initial certification except in circumstances whereas family composition changes after initial occupancy a determination must be made as to whether the
remaining member of the household will be eligible to receive assistance. Eligibility requirements are found in HUD's regulations at 24 CFR Part 5.
The Corporation is responsible for annually reexamining incomes of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR Section 891.410). Assistance applicants shall submit signed consent forms upon initial application and at reexamination (24 CFR Section 5.230).
Questioned Cost: Not determinable.
Condition/Context: During our risk assessment procedures and follow-up on the prior year findings, we noted that the tenant eligibility issues that were identified in the prior years persisted. The issues affecting tenant eligibility include missing documentation to support the eligibility requirements and tenant recertification. As a result, we did not select a sample from the population for testing.
Effect: Insufficient documentation of tenant eligibility and late recertifications. As a result of untimely recertifications, cash collections has been delayed by HUD causing operating cash flow deficiencies resulting in significant growth in related party balances due to the parent entity and unpaid subsidies at June 30, 2024.
Cause: Lack of management oversight due to turnover. As a result, management has not been able to implement their planned corrective actions in a timely fashion.
Recommendation: The Corporation should have procedures in place to ensure documentation is maintained accordance with its requirements.
Views of Responsible Officials and Planned Corrective Actions: Staffing turnover limited ability for portfolio property managers to effectively manage tenant files at each building location. Historically, the management and auditing of tenant files was entirely under the process flows for property management team. The Inglis Compliance department is now sampling and reviewing tenant files to assure tenant files are accurate and audit ready at any given time. The tenant files for all entities will be current by December 2024.
Inglis Housing Corporation hired new a new property management Executive Director in August 2024. Under her leadership the team has made extensive progress updating and bringing all PRACs, tenant recertifications, and tenant files into compliance. There has been in depth training for the property management team on the usage of a newly implemented property management system. All staff have or will attend external training classes for tax credit and HUD property management functions. The property management team is working on reviewing and updating all tenant files with a goal of being in compliance for the June 30, 2025 audit. Extensive process has been made as of October 2024. All of the HUD entities managed by the property management team are current through June 2024.