Audit 360638

Finding No. 2024-001: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Total assistance revenue. Sample Size Information: All monthly PRAC requests. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, applications for renewal of PRAC must be submitted at least 120 days prior to the expiration date of the contract. Statement of Condition: The Project did not submit the renewal request at least 120 days prior to the expiration date of the contract. Cause: The Project did not adhere to HUD regulations for PRAC renewal. Effect or Potential Effect: The Project is not in compliance with HUD regulations for timely renewal of the PRAC contract resulting in the delayed receipt of HAP funds. Auditor Non-Compliance Code: R – Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure the Project submits PRAC renewal requests in accordance with HUD requirements. Response Indicator: Agree. Completion Date: 11/08/2023 Response: New staff has been put in place to monitor and submit all renewals in a timely fashion.

Finding No. 2024-002: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Ten tenants. Sample Size Information: Three tenants. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, the owner must refund the full security deposit plus accrued interest and/or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant’s rights under state and local laws within 30 days from moveout. Statement of Condition: The Project did not refund the security deposit plus accrued interest to one tenant within the HUD required 30 days from tenant move-out. Cause: The Project did not follow the HUD regulations for refunding security deposits resulting in untimely refunds of security deposits. Effect or Potential Effect: The Project is not in compliance with HUD regulations requiring tenant security deposits to be refunded within 30 days of a tenant move out if no assessments are made against that tenant. Auditor Non-Compliance Code: M – Security Deposits. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: The Project should comply with state law and HUD regulations for refunding security deposits timely. Response Indicator: Agree. Completion Date: 9/17/2024 Response: Staff training has been provided and included in monthly reporting procedures.

Finding No. 2024-003: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: Sixty-two tenants. Sample Size Information: Ten tenants. Identification of Repeat Finding and Finding Reference Number: No. Criteria: HUD regulations require: Verification of initial income through the use of EIV reports within 90 days of move-in; Annual unit inspections performed in a timely manner and the corresponding documentation maintained; Documentation of tenant security deposits and refunds to be maintained; Apartment applications stamped with date and time received; Lease addendums to be signed by tenants. Statement of Condition: Of the tenant files selected: One tenant file did not contain verification of the initial income through the use of EIV reports; An annual unit inspection report was not maintained for one tenant; A security deposit was documented on the lease and HUD form 50059 with no supporting documentation of the actual date and time deposit was collected; An application for housing was not marked with the date and time received for two tenants; Lease addendums were not signed by one tenant. Cause: The Project did not adhere to HUD regulations for initial eligibility and did not perform timely income verification. In addition, the Project did not follow the HUD regulations in relation to verification of tenant deposits. The Project also did not maintain appropriate tenant eligibility documentation as required by HUD Effect or Potential Effect: Unable to verify tenant eligibility and cost of assistance may be disallowed. Unable to determine date and time for the receipt of applications for proper waiting list placement and subsequent selection to occupy a unit. Auditor Non-compliance Code: R – Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: The Project should implement procedures to ensure all documentation related to applicants and tenants are properly executed and maintained, and that the manager verifies eligibility by obtaining all required documents for potential tenants while verifying and maintaining support for tenant income eligibility through the EIV system in a timely manner. Response Indicator: Agree. Completion Date: 9/30/2025 Response: Staff training has been provided with additional HUD training inclusive of EIV reporting and tenant file maintenance and included in monthly reporting procedures.

Finding No. 2024-001: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Total assistance revenue. Sample Size Information: All monthly PRAC requests. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, applications for renewal of PRAC must be submitted at least 120 days prior to the expiration date of the contract. Statement of Condition: The Project did not submit the renewal request at least 120 days prior to the expiration date of the contract. Cause: The Project did not adhere to HUD regulations for PRAC renewal. Effect or Potential Effect: The Project is not in compliance with HUD regulations for timely renewal of the PRAC contract resulting in the delayed receipt of HAP funds. Auditor Non-Compliance Code: R – Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure the Project submits PRAC renewal requests in accordance with HUD requirements. Response Indicator: Agree. Completion Date: 11/08/2023 Response: New staff has been put in place to monitor and submit all renewals in a timely fashion.

Finding No. 2024-002: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Ten tenants. Sample Size Information: Three tenants. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, the owner must refund the full security deposit plus accrued interest and/or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant’s rights under state and local laws within 30 days from moveout. Statement of Condition: The Project did not refund the security deposit plus accrued interest to one tenant within the HUD required 30 days from tenant move-out. Cause: The Project did not follow the HUD regulations for refunding security deposits resulting in untimely refunds of security deposits. Effect or Potential Effect: The Project is not in compliance with HUD regulations requiring tenant security deposits to be refunded within 30 days of a tenant move out if no assessments are made against that tenant. Auditor Non-Compliance Code: M – Security Deposits. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: The Project should comply with state law and HUD regulations for refunding security deposits timely. Response Indicator: Agree. Completion Date: 9/17/2024 Response: Staff training has been provided and included in monthly reporting procedures.

Finding No. 2024-003: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: Sixty-two tenants. Sample Size Information: Ten tenants. Identification of Repeat Finding and Finding Reference Number: No. Criteria: HUD regulations require: Verification of initial income through the use of EIV reports within 90 days of move-in; Annual unit inspections performed in a timely manner and the corresponding documentation maintained; Documentation of tenant security deposits and refunds to be maintained; Apartment applications stamped with date and time received; Lease addendums to be signed by tenants. Statement of Condition: Of the tenant files selected: One tenant file did not contain verification of the initial income through the use of EIV reports; An annual unit inspection report was not maintained for one tenant; A security deposit was documented on the lease and HUD form 50059 with no supporting documentation of the actual date and time deposit was collected; An application for housing was not marked with the date and time received for two tenants; Lease addendums were not signed by one tenant. Cause: The Project did not adhere to HUD regulations for initial eligibility and did not perform timely income verification. In addition, the Project did not follow the HUD regulations in relation to verification of tenant deposits. The Project also did not maintain appropriate tenant eligibility documentation as required by HUD Effect or Potential Effect: Unable to verify tenant eligibility and cost of assistance may be disallowed. Unable to determine date and time for the receipt of applications for proper waiting list placement and subsequent selection to occupy a unit. Auditor Non-compliance Code: R – Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: The Project should implement procedures to ensure all documentation related to applicants and tenants are properly executed and maintained, and that the manager verifies eligibility by obtaining all required documents for potential tenants while verifying and maintaining support for tenant income eligibility through the EIV system in a timely manner. Response Indicator: Agree. Completion Date: 9/30/2025 Response: Staff training has been provided with additional HUD training inclusive of EIV reporting and tenant file maintenance and included in monthly reporting procedures.