Finding SA2020-001: Internal Control
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: Public Housing Authorities (PHA) are required to establish and maintain effective internal
control over the Federal award that provides reasonable assurance that the non-Federal entity is
managing the Federal award in compliance with Federal statutes, regulations, and the terms and
conditions of the Federal award as stated in CFR 200.303.
Condition: During our audit, we were unable to obtain an understanding of the internal controls over
the federal awards of the Authority, as current personnel could not respond to the processes and
procedures.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide any information regarding the internal controls of the Authority.
Effect: The Housing Authority is not in compliance with Federal statutes, regulations, and the terms
and conditions of the Federal award as stated in CFR 200.303.
Identification as a repeat finding: Yes, since 2019.
Recommendation: The Housing Authority must develop procedures to ensure that there is an internal
control environment in compliance with the federal requirements.
Management Response: The City has assigned staff to specific duties to support the Authority’s
financial operations. Staff have implemented new processes that align with the City’s policies and
procedures, while also in accordance with HUD regulations and requirements, to improve the integrity
and accuracy of the Authority’s financial reporting and management of federal awards. The procedures
ensure separation of duties and levels of approval to handle and manage federal funds. Staff also
continue to attend trainings to understand Federal statutes and regulations.
Finding SA2020-002: Lack of Supporting Documentation for Expenditures
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 2 CFR part 200, subpart E, costs charged to federal funds must be allowable, reasonable, and
properly documented. Costs should be adequately supported to demonstrate they were necessary and
directly related to the deferral programs.
Condition: During our audit, we tested a sample of 51 transactions. Of these, 5 transactions with
amount $46,490 lacked sufficient supporting documentation to verify the nature and allowability of the
expenditures.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide supporting and documentation was not properly maintained, resulting in
missing records to support certain expenditures.
Effect: The Housing Authority may have charged unallowable costs to the Operating Fund, resulting in
noncompliance with federal requirements.
Questioned Costs: We question the costs in the amount of $46,490 noted above.
Recommendation: The Housing Authority should develop and implement procedures to ensure that all
required documentation related to public housing expenditures is properly maintained and supported.
Staff responsible for approving and managing these records should be trained to ensure they
understand and comply with applicable program requirements.
Management Response: The Authority understands and accepts the recommendation to ensure that all
required documentation is maintained and accessible. The Authority staff will follow the City’s
processes by having management review invoices/charges for approval then will be scanned and
attached to the payment records in MUNIS.
In addition, the delay in timing to review and audit these records have allowed for documents to be
transferred offsite and not easily accessible.
Finding SA2020-003: Operating Subsidy Payments Supporting Documentation
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 990 requires Public Housing Authorities (PHA) to provide operating subsidies
to public housing projects and document the specific calculation requirements through HUD Form
52723.
Condition: During our audit, we noted that operating subsidy payments totaling $728,553 made to
Easter Hill for Richmond Village I, II, and III during fiscal year 2020 were not supported by HUD Form
52723. As a result, we were unable to determine whether the subsidy amounts were properly calculated
in accordance with the requirements of 24 CFR Part 990.
Cause: Due to staffing shortage, operating subsidy payments were paid in a lump sum without
attaching detailed supporting documents.
Effect: The Housing Authority is not in compliance with the specific calculation requirements of HUD
Form 52723 as specified in 24 CFR section 990.
Questioned Costs: We question the costs in the amount of $728,553 noted above.
Identification as a repeat finding: Yes, since 2019.
Recommendation: The Housing Authority must develop procedures to ensure that all operating
subsidy payments made are supported by HUD Form 52723 and in accordance with 24 CFR section 990.
Management Response: The operating subsidy payments to Easter Hill Development for the properties
Richmond Village I – III are processed based on the property management’s request. The amount paid
can differ from the Form 52723 which reflects the eligible amount for the calendar year ending
December 31, compared to the drawn down and paid amount which is in each fiscal year ending June
30.
The City and the Authority staff require a document/invoice from Easter Hill Development to request
the amount of operating subsidy to be drawn down from eLOCCS and paid via wire transfer as a passthrough
payment, based on their needs and/or eligible amount set forth by HUD.
Finding SA2020-004: Missing Tenant Documents
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 960 requires Public Housing Authorities (PHA) that receive public housing
funds to remit payment to eligible tenants and to maintain documentation for the payments through a
contract.
Condition: We reviewed sixty tenant files for existing and new tenants for FY2020 and noted that the
Authority did not maintain all required documentation. Furthermore, approximately 70% of the tenants
are missing required forms, and 10 had no related forms and documents for FY2020. We also noted the
reflected rent amounts did not align with the rent calculation or reexamination amount.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide such documentation.
Effect: The Housing Authority is not in compliance with the payment documentation requirements as
stated in 24 CFR section 960.
Identification as a repeat finding: Yes, since 2017.
Recommendation: The Housing Authority must develop procedures to ensure that all required
documentation for public housing tenants is properly maintained.
Management Response: As part of ongoing efforts to strengthen file integrity and compliance
standards, the Authority has implemented the following measures:
Standardized File Checklist: A comprehensive checklist has been developed and is included in
all resident files. This tool is designed to ensure that all required documentation is accounted for
and consistently organized.
Dedicated File Oversight Personnel: The Authority has hired designated staff responsible for the
oversight, organization, and quality control of file documentation. These individuals will ensure
ongoing compliance with HUD regulations and internal standards, as well as support audit
readiness.
Income Certification Systemization: All income calculations for resident certifications are now
completed and documented exclusively within the Property Management system, Yardi One.
This centralizes data processing, improves accuracy, and ensures a reliable audit trail for all
income determinations.
Finding SA2020-005: Lack of Documented Suspension and Debarment Verification for Vendors
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 180 required non-federal entities including Public Housing Authorities (PHA)
must verify that vendors and contractors are not suspended or debarred prior to entering into a
contract.
Condition: During our audit, we noted four vendors have no documentation to proof that vendors were
not suspended or debated.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the suspension and debarment requirements as
stated in 24 CFR part 180.
Recommendation: The Housing Authority should retain documentation that vendors are not
suspended or debarred prior to awarding federally funded contracts.
Management Response: The Authority understands and accepts the recommendation that
documentation of vendor suspension or debarment status must be retained. The Authority staff has
followed the City’s process in verifying this information, but there was no proof retained. It has been
inquired on the sufficient requirement and the understanding is that a screenshot will suffice. Staff will
proceed with retaining a screenshot of vendor verification.
Finding SA2020-006: Lack of documentations for Declaration of Trust (DOT) and Declaration of
Restrictive Covenants (DORC)
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 905 required non-federal entities including Public Housing Authorities (PHA)
are required to maintain current or valid DOT or DORC recorded against all public housing properties
that have received funding under the U.S. Housing Act of 1937.
Condition: During our audit, we noted the DOTs provided for certain housing properties are outdated
and didn’t reflect subsequent modernization improvements.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the HUD requirements as stated in 24 CFR
section 905.
Recommendation: The Housing Authority should maintain a list of all owned and insured properties,
including land, non-residential facilities, and modernization efforts, and ensure that each property has a
current and valid DOT/DORC on record.
Management Response: The Authority maintains a comprehensive list of all owned and insured assets
within our Asset Repositioning strategy document. In alignment with the recommendation, the
Housing Authority will establish an electronic filing system to securely store all declarations of trust. In
accordance with PHI Notice 2014-14, the Housing Authority will formally request the release of the
Declaration of Trust (DOT) from HUD prior to the closing or transfer of the title of any public housing
property.
Finding SA2020-007: Environmental Review
AL number: 14.850 and 14.872
AL Title: Public and Indian Housing and Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 50 and 58 required non-federal entities including Public Housing Authorities
(PHA) must complete environmental reviews for all the operating and capital activities every five years.
This review must result in a formal approval signed by a HUD Approving Official, such as Form HUD-
7015.16, Form HUD-4128, or another acceptable format as outlined in PIH Notice 2016-22.
Condition: During our audit, we noted no environmental review approval documentation was
provided for the Nevin and Hacienda properties for FY2020.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the environmental review requirements as stated
in 24 CFR parts 50 and 58.
Recommendation: The Housing Authority should ensure that a current environmental review is
completed for all applicable properties and retain the related documentation properly.
Management Response: On May 6, 2025, the Authority Board of Commissioners passed a resolution to
authorize a contract for conducting a physical needs assessment of Nystrom Village and Richmond
Village. This assessment aims to identify repair, maintenance, and capital improvement activities for
future environmental reviews.
Finding SA2020-007: Environmental Review
AL number: 14.850 and 14.872
AL Title: Public and Indian Housing and Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 50 and 58 required non-federal entities including Public Housing Authorities
(PHA) must complete environmental reviews for all the operating and capital activities every five years.
This review must result in a formal approval signed by a HUD Approving Official, such as Form HUD-
7015.16, Form HUD-4128, or another acceptable format as outlined in PIH Notice 2016-22.
Condition: During our audit, we noted no environmental review approval documentation was
provided for the Nevin and Hacienda properties for FY2020.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the environmental review requirements as stated
in 24 CFR parts 50 and 58.
Recommendation: The Housing Authority should ensure that a current environmental review is
completed for all applicable properties and retain the related documentation properly.
Management Response: On May 6, 2025, the Authority Board of Commissioners passed a resolution to
authorize a contract for conducting a physical needs assessment of Nystrom Village and Richmond
Village. This assessment aims to identify repair, maintenance, and capital improvement activities for
future environmental reviews.
Finding SA2020-008: Capital Funds for Operating Costs
AL number: 14.872
AL Title: Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 905 required Public Housing Authorities (PHA) transferred capital funds to
operations under BLI 1406 are not considered obligated until the PHA has both budgeted and drawn
down the funds. Funds must be budgeted under BLI 1406 (Operations), and a voucher request must be
submitted in LOCCS. The amount reported in LOCCS must match the amount recorded in the PHA's
accounting system.
Condition: During our audit, we noted Authority recorded capital fund transfer in its general ledger
that didn’t align with the LOCCS.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide properly explanation.
Effect: The Housing Authority is not compliance with the requirements as stated in 24 CFR section 905.
Recommendation: The Housing Authority should ensure that all obligations of Capital Funds for
operations (BLI 1406) are recorded in its accounting system based on the actual voucher request in
LOCCS. Staff should be trained and keep track of the requirements align with the compliance.
Management Response: The Authority understands and accepts the recommendation to retain
documentation for Capital Fund drawdowns. The City and Authority staff have implemented a process
of providing a form that is reviewed and approved by the Authority Director before drawdowns are
processed in eLOCCS. This process also ensures the separation of duties of funding requests, cash
handling, and reporting.
Finding SA2020-001: Internal Control
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: Public Housing Authorities (PHA) are required to establish and maintain effective internal
control over the Federal award that provides reasonable assurance that the non-Federal entity is
managing the Federal award in compliance with Federal statutes, regulations, and the terms and
conditions of the Federal award as stated in CFR 200.303.
Condition: During our audit, we were unable to obtain an understanding of the internal controls over
the federal awards of the Authority, as current personnel could not respond to the processes and
procedures.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide any information regarding the internal controls of the Authority.
Effect: The Housing Authority is not in compliance with Federal statutes, regulations, and the terms
and conditions of the Federal award as stated in CFR 200.303.
Identification as a repeat finding: Yes, since 2019.
Recommendation: The Housing Authority must develop procedures to ensure that there is an internal
control environment in compliance with the federal requirements.
Management Response: The City has assigned staff to specific duties to support the Authority’s
financial operations. Staff have implemented new processes that align with the City’s policies and
procedures, while also in accordance with HUD regulations and requirements, to improve the integrity
and accuracy of the Authority’s financial reporting and management of federal awards. The procedures
ensure separation of duties and levels of approval to handle and manage federal funds. Staff also
continue to attend trainings to understand Federal statutes and regulations.
Finding SA2020-002: Lack of Supporting Documentation for Expenditures
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 2 CFR part 200, subpart E, costs charged to federal funds must be allowable, reasonable, and
properly documented. Costs should be adequately supported to demonstrate they were necessary and
directly related to the deferral programs.
Condition: During our audit, we tested a sample of 51 transactions. Of these, 5 transactions with
amount $46,490 lacked sufficient supporting documentation to verify the nature and allowability of the
expenditures.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide supporting and documentation was not properly maintained, resulting in
missing records to support certain expenditures.
Effect: The Housing Authority may have charged unallowable costs to the Operating Fund, resulting in
noncompliance with federal requirements.
Questioned Costs: We question the costs in the amount of $46,490 noted above.
Recommendation: The Housing Authority should develop and implement procedures to ensure that all
required documentation related to public housing expenditures is properly maintained and supported.
Staff responsible for approving and managing these records should be trained to ensure they
understand and comply with applicable program requirements.
Management Response: The Authority understands and accepts the recommendation to ensure that all
required documentation is maintained and accessible. The Authority staff will follow the City’s
processes by having management review invoices/charges for approval then will be scanned and
attached to the payment records in MUNIS.
In addition, the delay in timing to review and audit these records have allowed for documents to be
transferred offsite and not easily accessible.
Finding SA2020-003: Operating Subsidy Payments Supporting Documentation
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 990 requires Public Housing Authorities (PHA) to provide operating subsidies
to public housing projects and document the specific calculation requirements through HUD Form
52723.
Condition: During our audit, we noted that operating subsidy payments totaling $728,553 made to
Easter Hill for Richmond Village I, II, and III during fiscal year 2020 were not supported by HUD Form
52723. As a result, we were unable to determine whether the subsidy amounts were properly calculated
in accordance with the requirements of 24 CFR Part 990.
Cause: Due to staffing shortage, operating subsidy payments were paid in a lump sum without
attaching detailed supporting documents.
Effect: The Housing Authority is not in compliance with the specific calculation requirements of HUD
Form 52723 as specified in 24 CFR section 990.
Questioned Costs: We question the costs in the amount of $728,553 noted above.
Identification as a repeat finding: Yes, since 2019.
Recommendation: The Housing Authority must develop procedures to ensure that all operating
subsidy payments made are supported by HUD Form 52723 and in accordance with 24 CFR section 990.
Management Response: The operating subsidy payments to Easter Hill Development for the properties
Richmond Village I – III are processed based on the property management’s request. The amount paid
can differ from the Form 52723 which reflects the eligible amount for the calendar year ending
December 31, compared to the drawn down and paid amount which is in each fiscal year ending June
30.
The City and the Authority staff require a document/invoice from Easter Hill Development to request
the amount of operating subsidy to be drawn down from eLOCCS and paid via wire transfer as a passthrough
payment, based on their needs and/or eligible amount set forth by HUD.
Finding SA2020-004: Missing Tenant Documents
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 960 requires Public Housing Authorities (PHA) that receive public housing
funds to remit payment to eligible tenants and to maintain documentation for the payments through a
contract.
Condition: We reviewed sixty tenant files for existing and new tenants for FY2020 and noted that the
Authority did not maintain all required documentation. Furthermore, approximately 70% of the tenants
are missing required forms, and 10 had no related forms and documents for FY2020. We also noted the
reflected rent amounts did not align with the rent calculation or reexamination amount.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide such documentation.
Effect: The Housing Authority is not in compliance with the payment documentation requirements as
stated in 24 CFR section 960.
Identification as a repeat finding: Yes, since 2017.
Recommendation: The Housing Authority must develop procedures to ensure that all required
documentation for public housing tenants is properly maintained.
Management Response: As part of ongoing efforts to strengthen file integrity and compliance
standards, the Authority has implemented the following measures:
Standardized File Checklist: A comprehensive checklist has been developed and is included in
all resident files. This tool is designed to ensure that all required documentation is accounted for
and consistently organized.
Dedicated File Oversight Personnel: The Authority has hired designated staff responsible for the
oversight, organization, and quality control of file documentation. These individuals will ensure
ongoing compliance with HUD regulations and internal standards, as well as support audit
readiness.
Income Certification Systemization: All income calculations for resident certifications are now
completed and documented exclusively within the Property Management system, Yardi One.
This centralizes data processing, improves accuracy, and ensures a reliable audit trail for all
income determinations.
Finding SA2020-005: Lack of Documented Suspension and Debarment Verification for Vendors
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 180 required non-federal entities including Public Housing Authorities (PHA)
must verify that vendors and contractors are not suspended or debarred prior to entering into a
contract.
Condition: During our audit, we noted four vendors have no documentation to proof that vendors were
not suspended or debated.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the suspension and debarment requirements as
stated in 24 CFR part 180.
Recommendation: The Housing Authority should retain documentation that vendors are not
suspended or debarred prior to awarding federally funded contracts.
Management Response: The Authority understands and accepts the recommendation that
documentation of vendor suspension or debarment status must be retained. The Authority staff has
followed the City’s process in verifying this information, but there was no proof retained. It has been
inquired on the sufficient requirement and the understanding is that a screenshot will suffice. Staff will
proceed with retaining a screenshot of vendor verification.
Finding SA2020-006: Lack of documentations for Declaration of Trust (DOT) and Declaration of
Restrictive Covenants (DORC)
AL number: 14.850
AL Title: Public and Indian Housing
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 905 required non-federal entities including Public Housing Authorities (PHA)
are required to maintain current or valid DOT or DORC recorded against all public housing properties
that have received funding under the U.S. Housing Act of 1937.
Condition: During our audit, we noted the DOTs provided for certain housing properties are outdated
and didn’t reflect subsequent modernization improvements.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the HUD requirements as stated in 24 CFR
section 905.
Recommendation: The Housing Authority should maintain a list of all owned and insured properties,
including land, non-residential facilities, and modernization efforts, and ensure that each property has a
current and valid DOT/DORC on record.
Management Response: The Authority maintains a comprehensive list of all owned and insured assets
within our Asset Repositioning strategy document. In alignment with the recommendation, the
Housing Authority will establish an electronic filing system to securely store all declarations of trust. In
accordance with PHI Notice 2014-14, the Housing Authority will formally request the release of the
Declaration of Trust (DOT) from HUD prior to the closing or transfer of the title of any public housing
property.
Finding SA2020-007: Environmental Review
AL number: 14.850 and 14.872
AL Title: Public and Indian Housing and Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 50 and 58 required non-federal entities including Public Housing Authorities
(PHA) must complete environmental reviews for all the operating and capital activities every five years.
This review must result in a formal approval signed by a HUD Approving Official, such as Form HUD-
7015.16, Form HUD-4128, or another acceptable format as outlined in PIH Notice 2016-22.
Condition: During our audit, we noted no environmental review approval documentation was
provided for the Nevin and Hacienda properties for FY2020.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the environmental review requirements as stated
in 24 CFR parts 50 and 58.
Recommendation: The Housing Authority should ensure that a current environmental review is
completed for all applicable properties and retain the related documentation properly.
Management Response: On May 6, 2025, the Authority Board of Commissioners passed a resolution to
authorize a contract for conducting a physical needs assessment of Nystrom Village and Richmond
Village. This assessment aims to identify repair, maintenance, and capital improvement activities for
future environmental reviews.
Finding SA2020-007: Environmental Review
AL number: 14.850 and 14.872
AL Title: Public and Indian Housing and Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR parts 50 and 58 required non-federal entities including Public Housing Authorities
(PHA) must complete environmental reviews for all the operating and capital activities every five years.
This review must result in a formal approval signed by a HUD Approving Official, such as Form HUD-
7015.16, Form HUD-4128, or another acceptable format as outlined in PIH Notice 2016-22.
Condition: During our audit, we noted no environmental review approval documentation was
provided for the Nevin and Hacienda properties for FY2020.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide the supporting documents.
Effect: The Housing Authority is not compliance with the environmental review requirements as stated
in 24 CFR parts 50 and 58.
Recommendation: The Housing Authority should ensure that a current environmental review is
completed for all applicable properties and retain the related documentation properly.
Management Response: On May 6, 2025, the Authority Board of Commissioners passed a resolution to
authorize a contract for conducting a physical needs assessment of Nystrom Village and Richmond
Village. This assessment aims to identify repair, maintenance, and capital improvement activities for
future environmental reviews.
Finding SA2020-008: Capital Funds for Operating Costs
AL number: 14.872
AL Title: Public Housing Capital Fund
Name of Federal Agency: Department of Housing and Urban Development
Federal Award Identification number and year: CA010 (2020)
Criteria: 24 CFR section 905 required Public Housing Authorities (PHA) transferred capital funds to
operations under BLI 1406 are not considered obligated until the PHA has both budgeted and drawn
down the funds. Funds must be budgeted under BLI 1406 (Operations), and a voucher request must be
submitted in LOCCS. The amount reported in LOCCS must match the amount recorded in the PHA's
accounting system.
Condition: During our audit, we noted Authority recorded capital fund transfer in its general ledger
that didn’t align with the LOCCS.
Cause: We understand that the staff overseeing the federal awards during fiscal year 2020 are no longer
with the Authority, and therefore, the staff overseeing the federal awards subsequent to the fiscal year
were unable to provide properly explanation.
Effect: The Housing Authority is not compliance with the requirements as stated in 24 CFR section 905.
Recommendation: The Housing Authority should ensure that all obligations of Capital Funds for
operations (BLI 1406) are recorded in its accounting system based on the actual voucher request in
LOCCS. Staff should be trained and keep track of the requirements align with the compliance.
Management Response: The Authority understands and accepts the recommendation to retain
documentation for Capital Fund drawdowns. The City and Authority staff have implemented a process
of providing a form that is reviewed and approved by the Authority Director before drawdowns are
processed in eLOCCS. This process also ensures the separation of duties of funding requests, cash
handling, and reporting.