FAC Explorer

Audit 360716

FY End
2024-09-30
Total Expended
$475.65M
Findings
16
Programs
5
Organization: Housing Authority of the City and County of San Francisco (CA)
Year: 2024 Accepted: 2025-06-30
Auditor: MacIas Gini & O'Connell LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
569122 2024-002 Material Weakness - E
569123 2024-002 Material Weakness - E
569124 2024-002 Material Weakness - E
569125 2024-003 Significant Deficiency Yes N
569126 2024-003 Significant Deficiency Yes N
569127 2024-003 Significant Deficiency Yes N
569128 2024-004 Significant Deficiency Yes N
569129 2024-004 Significant Deficiency Yes N
1145564 2024-002 Material Weakness - E
1145565 2024-002 Material Weakness - E
1145566 2024-002 Material Weakness - E
1145567 2024-003 Significant Deficiency Yes N
1145568 2024-003 Significant Deficiency Yes N
1145569 2024-003 Significant Deficiency Yes N
1145570 2024-004 Significant Deficiency Yes N
1145571 2024-004 Significant Deficiency Yes N

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $33.97M Yes 3
14.850 Public and Indian Housing $8.65M - 0
14.879 Mainstream Vouchers $6.74M Yes 2
14.872 Public Housing Capital Fund $3.00M Yes 0
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $795,148 - 0

Contacts

Name Title Type
SZEGXHQ2K1W3 Mamadiu Gning Auditee
4157155200 Scott Diem Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 – GENERAL Accounting Policies: In accordance with U.S. Department of Housing and Urban Development (HUD) guidance, HUD considers the net Annual Contributions Contract subsidy for a public housing agency’s (PHA) fiscal year under audit to be an expenditure for the purposes of the Schedule. Specifically, the net low rent operating subsidy received and the net Section 8 funds received, net of year-end adjustments, by the PHA would be the federal awards expended for the fiscal period under audit. Therefore, the amount in the Schedule is the total amount received directly from HUD for the Public and Indian Housing Program (ALN 14.850), Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation program (ALN 14.856), and the Housing Voucher Cluster (ALN 14.871 and 14.879). Expenditures of other federal awards are reported in the Authority’s basic financial statements as expenses for non-capital expenditures and as additions to capital assets for capital-related expenditures. Such expenditures are recognized following the cost principles contained in 2 CFR 200, Subpart E (Cost Principles), wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented in this Schedule may differ from amounts presented in the basic financial statements. De Minimis Rate Used: N Rate Explanation: See note 2 -Basis of Presentation The accompanying schedule of expenditures of federal awards (Schedule) includes the federal grant activity of the Housing Authority of the City and County of San Francisco, California (Authority). The Authority’s reporting entity is defined in Note 1 of the Authority’s basic financial statements. The information in 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. Federal programs are listed by their Assistance Listing Numbers (ALN).
Title: NOTE 2 – BASIS OF PRESENTATION Accounting Policies: In accordance with U.S. Department of Housing and Urban Development (HUD) guidance, HUD considers the net Annual Contributions Contract subsidy for a public housing agency’s (PHA) fiscal year under audit to be an expenditure for the purposes of the Schedule. Specifically, the net low rent operating subsidy received and the net Section 8 funds received, net of year-end adjustments, by the PHA would be the federal awards expended for the fiscal period under audit. Therefore, the amount in the Schedule is the total amount received directly from HUD for the Public and Indian Housing Program (ALN 14.850), Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation program (ALN 14.856), and the Housing Voucher Cluster (ALN 14.871 and 14.879). Expenditures of other federal awards are reported in the Authority’s basic financial statements as expenses for non-capital expenditures and as additions to capital assets for capital-related expenditures. Such expenditures are recognized following the cost principles contained in 2 CFR 200, Subpart E (Cost Principles), wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented in this Schedule may differ from amounts presented in the basic financial statements. De Minimis Rate Used: N Rate Explanation: See note 2 -Basis of Presentation In accordance with U.S. Department of Housing and Urban Development (HUD) guidance, HUD considers the net Annual Contributions Contract subsidy for a public housing agency’s (PHA) fiscal year under audit to be an expenditure for the purposes of the Schedule. Specifically, the net low rent operating subsidy received and the net Section 8 funds received, net of year-end adjustments, by the PHA would be the federal awards expended for the fiscal period under audit. Therefore, the amount in the Schedule is the total amount received directly from HUD for the Public and Indian Housing Program (ALN 14.850), Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation program (ALN 14.856), and the Housing Voucher Cluster (ALN 14.871 and 14.879). Expenditures of other federal awards are reported in the Authority’s basic financial statements as expenses for non-capital expenditures and as additions to capital assets for capital-related expenditures. Such expenditures are recognized following the cost principles contained in 2 CFR 200, Subpart E (Cost Principles), wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented in this Schedule may differ from amounts presented in the basic financial statements. The Authority did not elect to use the 10% de minimus cost rate as covered in Title 2 CFR §200.414 Indirect (F&A) costs. As a result of the COVID-19 pandemic, many new federal programs have been established and funding has been added to existing federal programs. Expenditures funded from the following acts are denoted by the prefix COVID-19 in the federal program title in the Schedule (as applicable): • Coronavirus Preparedness and Response Supplemental Appropriations Act • Families First Coronavirus Response Act • Coronavirus Aid, Relief, and Economic Security Act (CARES Act) • Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) • American Rescue Plan Act (ARP)
Title: NOTE 3 – RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Accounting Policies: In accordance with U.S. Department of Housing and Urban Development (HUD) guidance, HUD considers the net Annual Contributions Contract subsidy for a public housing agency’s (PHA) fiscal year under audit to be an expenditure for the purposes of the Schedule. Specifically, the net low rent operating subsidy received and the net Section 8 funds received, net of year-end adjustments, by the PHA would be the federal awards expended for the fiscal period under audit. Therefore, the amount in the Schedule is the total amount received directly from HUD for the Public and Indian Housing Program (ALN 14.850), Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation program (ALN 14.856), and the Housing Voucher Cluster (ALN 14.871 and 14.879). Expenditures of other federal awards are reported in the Authority’s basic financial statements as expenses for non-capital expenditures and as additions to capital assets for capital-related expenditures. Such expenditures are recognized following the cost principles contained in 2 CFR 200, Subpart E (Cost Principles), wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented in this Schedule may differ from amounts presented in the basic financial statements. De Minimis Rate Used: N Rate Explanation: See note 2 -Basis of Presentation The Schedule agrees to or can be reconciled with the amounts reported in the Authority’s basic financial statements.

Finding Details

Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-004
Finding Reference: 2024-004 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions - HQS Enforcement Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.404(a)(3), the Authority must not make any housing assistance payments (HAP) for a dwelling unit that fails to meet the housing quality standard (HQS), unless the owner corrects the defect within the period specified by the Authority and the Authority verifies the correction. If a defect is life threatening, the owner must correct the defect within no more than 24 hours. For other defects, the owner must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Furthermore, 24 CFR 982.404(b)(2) states that if an HQS breach caused by the family is life threatening, the family must correct the defect within no more than 24 hours. For other family-caused defects, the family must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Condition Of the total of 5,989 tenants with failed inspections during the fiscal year, we identified eight cases in a statistically valid sample of 60 failed inspections in which the Authority did not perform follow-up inspections within the required timeframe and was not able to provide evidence showing that a PHA approved extension was granted. Cause of Condition The Authority did not have adequate controls in place to ensure that the HQS are being enforced or completed in a timely manner. Effect The Authority is not in compliance with the HQS enforcement requirements, which may result in tenants living in unsafe housing units. In addition, the Authority may be paying HAPs to property owners whose units have inadequate housing quality or may be incorrectly withholding HAPs to landlords who have properly corrected deficiencies within the required timeframes. Questioned Costs The Authority was able to provide documentation showing that the units were inspected after the required time frames and ultimately passed inspection. Therefore, questioned costs were not identified in connection with the units examined. Identification of Repeat Finding This is a repeat of finding 2023-003 reported for the year ended September 30, 2024. Recommendation The Authority should continue to develop procedures and strengthen its internal controls related to HQS enforcement to ensure that follow ups on failed inspections are performed timely. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-004
Finding Reference: 2024-004 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions - HQS Enforcement Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.404(a)(3), the Authority must not make any housing assistance payments (HAP) for a dwelling unit that fails to meet the housing quality standard (HQS), unless the owner corrects the defect within the period specified by the Authority and the Authority verifies the correction. If a defect is life threatening, the owner must correct the defect within no more than 24 hours. For other defects, the owner must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Furthermore, 24 CFR 982.404(b)(2) states that if an HQS breach caused by the family is life threatening, the family must correct the defect within no more than 24 hours. For other family-caused defects, the family must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Condition Of the total of 5,989 tenants with failed inspections during the fiscal year, we identified eight cases in a statistically valid sample of 60 failed inspections in which the Authority did not perform follow-up inspections within the required timeframe and was not able to provide evidence showing that a PHA approved extension was granted. Cause of Condition The Authority did not have adequate controls in place to ensure that the HQS are being enforced or completed in a timely manner. Effect The Authority is not in compliance with the HQS enforcement requirements, which may result in tenants living in unsafe housing units. In addition, the Authority may be paying HAPs to property owners whose units have inadequate housing quality or may be incorrectly withholding HAPs to landlords who have properly corrected deficiencies within the required timeframes. Questioned Costs The Authority was able to provide documentation showing that the units were inspected after the required time frames and ultimately passed inspection. Therefore, questioned costs were not identified in connection with the units examined. Identification of Repeat Finding This is a repeat of finding 2023-003 reported for the year ended September 30, 2024. Recommendation The Authority should continue to develop procedures and strengthen its internal controls related to HQS enforcement to ensure that follow ups on failed inspections are performed timely. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-002
Finding Reference: 2024-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Eligibility Classification of Finding: Material Weakness in Internal Control over Compliance Material Noncompliance Criteria Pursuant to 24 CFR 982.516, the Authority must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third party verification. As a condition of admission to or continued assistance, the Authority shall require the tenant and other family members to provide necessary information, documentation, and execute a HUD-approved release and consent form authorizing the Authority to verify income eligibility. For both family and income examinations and reanimations, the Authority must obtain and document in the tenant file 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 income-based rent. 24 CFR 982.516 also requires the Authority to establish procedures that are appropriate and necessary to assure that income data provided by application or participant families is complete and accurate. Condition From a total population of 16,907 tenants under the Housing Choice Voucher cluster for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment within the fiscal year ended September 30, 2024 for each of 60 selected tenants. For fifteen of the tenants examined, the Authority was not able to provide documentation demonstrating that a reexamination was completed within the required time frame prior to the tested monthly subsidy payment. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all relevant tenant records and documents are properly completed and filed with within the specified due dates for annual reexamination. Effect The Authority is not in compliance with HUD requirements regarding annual re-examination of family income and composition, which may result in inaccurate assistance provided to participants. Questioned Costs The Authority was able to provide documentation demonstrating that reexaminations were completed subsequent to the tested subsidy payments. Therefore, there were no questioned costs identified in connection with the tenants examined. Identification of Repeat Finding This is not a repeat finding in the immediate prior audit period. Recommendation The Authority should ensure that it has procedures in place to track and complete future tenant reexaminations within the required time frames. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-003
Finding Reference: 2024-003 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 and 14.879 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions (Housing Quality Standards Inspections) Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.158 and 982.405, the Authority must inspect the units leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and must also conduct quality control re-inspections. The PHA must prepare and maintain a unit inspection report for at least three years. Condition From a total population of 16,907 tenants for the fiscal year ended September 30, 2024, we selected a statistically valid sample of one monthly subsidy payment for each of 60 selected tenants and identified five tenants whose HQS inspections were not completed within the required due dates prior to the subsidy payments. Cause of Condition The Authority’s internal control procedures were not sufficient to ensure that all HQS inspections were completed within the specified due dates and that all related inspection records are properly filed. Effect The Authority is not in compliance with the HQS inspection requirements. The Authority may be paying Housing Assistance Payments (HAPs) to property owners whose units have inadequate housing quality. Questioned Costs The units were ultimately inspected and determined to be compliant with the Housing Quality Standards. Questioned costs were not identified. Identification of Repeat Finding This is a repeat of finding 2023-002 reported for the year ended September 30, 2023. Recommendation The Authority should revisit its procedures, systems and controls to ensure the required HQS inspections are completed in a timely manner, and to strengthen its record retention and filing systems. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-004
Finding Reference: 2024-004 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions - HQS Enforcement Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.404(a)(3), the Authority must not make any housing assistance payments (HAP) for a dwelling unit that fails to meet the housing quality standard (HQS), unless the owner corrects the defect within the period specified by the Authority and the Authority verifies the correction. If a defect is life threatening, the owner must correct the defect within no more than 24 hours. For other defects, the owner must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Furthermore, 24 CFR 982.404(b)(2) states that if an HQS breach caused by the family is life threatening, the family must correct the defect within no more than 24 hours. For other family-caused defects, the family must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Condition Of the total of 5,989 tenants with failed inspections during the fiscal year, we identified eight cases in a statistically valid sample of 60 failed inspections in which the Authority did not perform follow-up inspections within the required timeframe and was not able to provide evidence showing that a PHA approved extension was granted. Cause of Condition The Authority did not have adequate controls in place to ensure that the HQS are being enforced or completed in a timely manner. Effect The Authority is not in compliance with the HQS enforcement requirements, which may result in tenants living in unsafe housing units. In addition, the Authority may be paying HAPs to property owners whose units have inadequate housing quality or may be incorrectly withholding HAPs to landlords who have properly corrected deficiencies within the required timeframes. Questioned Costs The Authority was able to provide documentation showing that the units were inspected after the required time frames and ultimately passed inspection. Therefore, questioned costs were not identified in connection with the units examined. Identification of Repeat Finding This is a repeat of finding 2023-003 reported for the year ended September 30, 2024. Recommendation The Authority should continue to develop procedures and strengthen its internal controls related to HQS enforcement to ensure that follow ups on failed inspections are performed timely. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.
Finding 2024-004
Finding Reference: 2024-004 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Section 8 Housing Choice Vouchers Federal Catalog Number: 14.871 Federal Grant Number: Not Applicable Category of Finding: Special Tests and Provisions - HQS Enforcement Classification of Finding: Significant Deficiency in Internal Control over Compliance Instance of Noncompliance Criteria Pursuant to 24 CFR 982.404(a)(3), the Authority must not make any housing assistance payments (HAP) for a dwelling unit that fails to meet the housing quality standard (HQS), unless the owner corrects the defect within the period specified by the Authority and the Authority verifies the correction. If a defect is life threatening, the owner must correct the defect within no more than 24 hours. For other defects, the owner must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Furthermore, 24 CFR 982.404(b)(2) states that if an HQS breach caused by the family is life threatening, the family must correct the defect within no more than 24 hours. For other family-caused defects, the family must correct the defect within no more than 30 calendar days (or any PHA-approved extension). Condition Of the total of 5,989 tenants with failed inspections during the fiscal year, we identified eight cases in a statistically valid sample of 60 failed inspections in which the Authority did not perform follow-up inspections within the required timeframe and was not able to provide evidence showing that a PHA approved extension was granted. Cause of Condition The Authority did not have adequate controls in place to ensure that the HQS are being enforced or completed in a timely manner. Effect The Authority is not in compliance with the HQS enforcement requirements, which may result in tenants living in unsafe housing units. In addition, the Authority may be paying HAPs to property owners whose units have inadequate housing quality or may be incorrectly withholding HAPs to landlords who have properly corrected deficiencies within the required timeframes. Questioned Costs The Authority was able to provide documentation showing that the units were inspected after the required time frames and ultimately passed inspection. Therefore, questioned costs were not identified in connection with the units examined. Identification of Repeat Finding This is a repeat of finding 2023-003 reported for the year ended September 30, 2024. Recommendation The Authority should continue to develop procedures and strengthen its internal controls related to HQS enforcement to ensure that follow ups on failed inspections are performed timely. View of Responsible Officials and Planned Corrective Action See separately prepared Corrective Action Plan.