Audit 369314

2024-002 – ELIGIBILITY – ELIGIBILITY FOR INDIVIDUALS Other Matter/Significant Deficiency U.S. Department of Housing and Urban Development ALN #: 14.871 – Housing Choice Voucher Program CRITERIA The PHA must conduct a reexamination of family income and composition at least annually. (2) Except as provided in paragraph (a)(3) of this section, the PHA must obtain and document in the tenant file third-party verification of the following factors, or must document in the tenant file why third-party verification was not available: (i) Reported family annual income; (ii) The value of assets; (iii) Expenses related to deductions from annual income; and (iv) Other factors that affect the determination of adjusted income. (2 CFR 982.516 (a)) (1) As a condition of admission to or continued assistance under the program, the PHA shall require the family head, and such other family members as the PHA designates, to execute a HUD-approved release and consent form (2 CFR 982.516(g)) CONDITION As a result of our testing, we identified the following: • Six instances in which the PHA obtained sufficient verifications of income; however, the PHA calculated the annualized tenant income incorrectly or it was unclear how the PHA calculated annualized income. • Four instances of an incorrect payment standard being used. • Four instances in which HUD’s Enterprise Income Verification system was not used. • One instance of a missing release and consent form (HUD-9886) • One instance of an insufficient verification of income. CAUSE The Authority's system of obtaining and documenting third-party verifications of tenant’s income, assets, or deductions was not sufficient EFFECT The Authority did obtain proper verification and calculation of income, expenses, and deductions are used in calculating annual income, adjusted income, and thereby housing assistance payments. QUESTIONED COSTS None Noted. CONTEXT The Authority leased approximately 320 vouchers through the Housing Choice Voucher Program throughout the year. We selected a sample of 40 participant files. This was not a statistically valid sample REPEAT FINDING This finding is repeated from finding 2023-002. RECOMMENDATION We recommend policies and procedures are strengthened to ensure all proper documentation and annual recertification are maintained in all tenant files to document eligibility. AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION See Corrective Action Plan.

2024-001 – INTERNAL CONTROLS OVER COMPLIANCE Other Matter/Significant Deficiency U.S. Department of Housing and Urban Development ALN #: 14.871 – Housing Choice Voucher Program ALN #: 14.850 – Public Housing Operating Fund CRITERIA A recipient of federal funding must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. (2 CFR 200.303(a)) CONDITION During our review of internal controls over compliance, which included reviewing monitoring reports from federal agencies, we identified the following matters: • The Authority did not have a policy in place governing the use of HUD’s Enterprise Income Verification (EIV) system. • The Authority was not following its administrative plan for the Housing Choice Voucher program related to minimum rents. The Authority has not established a minimum rent policy for Public Housing. • The Authority did not have a written methodology for how it conducts annual quality control reviews of HCV participant files. • The Authority did not follow its administrative plan regarding terminating participant from the Housing Choice Voucher Program. The Authority did not have a policy addressing participants being terminated from the Public Housing Program. • The VHA was not in compliance with updated Violence Against Women Act (VAWA) requirements. • The Authority’s day-to-day practices for the administration of the Public Housing program differ from the Admissions and Continued Occupancy Policy. • The Authority did not have a Section 3 policy. • The Authority did not follow its Administrative Plan related to preferences for the Project Based Voucher (PBV) waiting list. CAUSE The Authority did not perform a review and update its compliance policies for changes in HUD regulations. EFFECT The lack of updated or written policies increases the risk of noncompliance with federal requirements, as staff may not have clear guidance. QUESTIONED COSTS None identified. CONTEXT The Authority administers both the Housing Choice Voucher and Public Housing Programs. Uniform Guidance requires the Authority to have written policies related to compliance with federal statutes, regulations, and terms of federal awards. REPEAT FINDING Not a repeat finding. RECOMMENDATION We recommend the Authority review all compliance-related policies and procedures and update or develop written documentation to align with current Uniform Guidance requirements. AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION See Corrective Action Plan.