FAC Explorer

Audit 350765

FY End
2024-06-30
Total Expended
$47.91M
Findings
4
Programs
5
Organization: Housing Authority of the City of Galveston, Texas (TX)
Year: 2024 Accepted: 2025-03-31
Auditor: Berman Hopkins CPAS and Associates LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
541969 2024-002 Significant Deficiency - E
541970 2024-001 Significant Deficiency Yes E
1118411 2024-002 Significant Deficiency - E
1118412 2024-001 Significant Deficiency Yes E

Programs

ALN Program Spent Major Findings
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $22.80M Yes 0
14.871 Section 8 Housing Choice Vouchers $21.82M - 1
14.850 Public Housing Operating Fund $1.75M Yes 1
14.872 Public Housing Capital Fund $1.45M Yes 0
14.896 Family Self-Sufficiency Program $96,132 - 0

Contacts

Name Title Type
ULV7BMZ3GL57 Arvle Dunn Auditee
4097651990 Laura Anne Pray Auditor
No contacts on file

Notes to SEFA

Title: NOTE A: BASIS OF PRESENTATION Accounting Policies: The accompanying schedule of expenditures of federal awards and local assistance includes the federal grant activity of the Galveston Housing Authority and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate The accompanying schedule of expenditures of federal awards and local assistance includes the federal grant activity of the Galveston Housing Authority and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority.
Title: NOTE B: INDIRECT COST RATE Accounting Policies: The accompanying schedule of expenditures of federal awards and local assistance includes the federal grant activity of the Galveston Housing Authority and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate The Authority did not elect to use the 10-percent de minimis indirect cost rate
Title: NOTE C: SUB-RECIPIENTS Accounting Policies: The accompanying schedule of expenditures of federal awards and local assistance includes the federal grant activity of the Galveston Housing Authority and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate During the year ended June 30, 2024, the Authority had no sub-recipients.
Title: NOTE D: NONCASH ASSISTANCE AND OTHER Accounting Policies: The accompanying schedule of expenditures of federal awards and local assistance includes the federal grant activity of the Galveston Housing Authority and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate The Authority did not receive any noncash assistance, federal loans, or federally funded insurance during the year ended June 30, 2024.

Finding Details

Finding 2024-002
2024-002 Eligibility Public and Indian Housing Significant deficiency in internal control Other Matter to be Reported Under the Uniform Guidance Condition: Out of a total tenant population of approximately 430 for Public and Indian Housing, 44 tenant files were tested and 8 files had the following deficiencies: • Six files had incorrect or missing flat rent option sheets; • One file was missing a custody information; and • One file had incorrect income calculation. Criteria: The Authority’s ACOP and 24 CFR 960.257 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding complete and accurate tenant files for all public housing sites. Context: The auditor randomly selected 44 tenants out of the population, which we consider to be a statistically valid sample size, for testing tenant files for eligibility. The auditor reviewed the tenant file and support to ensure controls over compliance were operating effectively. Cause: Public housing sites do not have adequate systems and controls in place to ensure all of the eligibility requirements are being followed. Effect: The Authority is not in full compliance with all of the HUD requirements regarding eligibility and tenant recertification which could result in incorrect amount of rental assistance being provided. Questioned Costs: Unknown Auditor Recommendations: The Authority should correct the deficiencies noted in the tested files and perform reviews of the remaining universe, for consideration of similar errors. In addition, the Authority should establish quality control review procedures to ensure proper monitoring of compliance with the requirements related to tenant eligibility. Management Response: See the Corrective Action Plan in this report.
Finding 2024-001
2024-001 Eligibility Housing Voucher Cluster Significant deficiency in internal control Other Matter to be Reported Under the Uniform Guidance Condition: Out of a population of approximately 1,700 for Housing Voucher Cluster, 41 tenant files were tested and 4 files had the following deficiencies: • Two files had incorrect payment standard; • One file had incorrect income calculation standard; and • One file was missing an EIV report for the annual recertification. Criteria: The Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Context: The auditor randomly selected 41 tenant files out of the population which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority does not have adequate systems and controls in place to ensure all of the eligibility requirements are being followed. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See the Corrective Action Plan in this report
Finding 2024-002
2024-002 Eligibility Public and Indian Housing Significant deficiency in internal control Other Matter to be Reported Under the Uniform Guidance Condition: Out of a total tenant population of approximately 430 for Public and Indian Housing, 44 tenant files were tested and 8 files had the following deficiencies: • Six files had incorrect or missing flat rent option sheets; • One file was missing a custody information; and • One file had incorrect income calculation. Criteria: The Authority’s ACOP and 24 CFR 960.257 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding complete and accurate tenant files for all public housing sites. Context: The auditor randomly selected 44 tenants out of the population, which we consider to be a statistically valid sample size, for testing tenant files for eligibility. The auditor reviewed the tenant file and support to ensure controls over compliance were operating effectively. Cause: Public housing sites do not have adequate systems and controls in place to ensure all of the eligibility requirements are being followed. Effect: The Authority is not in full compliance with all of the HUD requirements regarding eligibility and tenant recertification which could result in incorrect amount of rental assistance being provided. Questioned Costs: Unknown Auditor Recommendations: The Authority should correct the deficiencies noted in the tested files and perform reviews of the remaining universe, for consideration of similar errors. In addition, the Authority should establish quality control review procedures to ensure proper monitoring of compliance with the requirements related to tenant eligibility. Management Response: See the Corrective Action Plan in this report.
Finding 2024-001
2024-001 Eligibility Housing Voucher Cluster Significant deficiency in internal control Other Matter to be Reported Under the Uniform Guidance Condition: Out of a population of approximately 1,700 for Housing Voucher Cluster, 41 tenant files were tested and 4 files had the following deficiencies: • Two files had incorrect payment standard; • One file had incorrect income calculation standard; and • One file was missing an EIV report for the annual recertification. Criteria: The Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Context: The auditor randomly selected 41 tenant files out of the population which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority does not have adequate systems and controls in place to ensure all of the eligibility requirements are being followed. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See the Corrective Action Plan in this report