Audit 374404

Statement of Condition – For the Low Rent Public Housing Program, we reviewed 40 tenant files (recertification files and new tenant files) for fiscal year ended March 31, 2025. We reviewed 13 files for tenants who moved out during the fiscal year ended March 31, 2025. The selected files represented a sample of all files in the three AMPS. We noted 1 instance in which social security income was incorrectly calculated in determining total tenant income. Criteria – Per the Public Housing Occupancy Guidebook (Section 3.9), “The gross amount of social security benefit income, prior to Medicare or other deductions, must be counted as income…”. Effect – For the file referenced above, outdated social security benefits were included in the calculation. As a result, total annual income was understated. The net effect of this error was an understatement of tenant rent of $11 per month. Cause – Incorrect procedures were followed in regards to calculating total tenant income. Identification of a repeat finding – This is a repeat finding from the immediate previous audit, 2024-001. Recommendation – Procedures surrounding tenant rent calculation processes should be strengthened. Views of responsible officials and planned corrective actions – The Authority agrees with this finding. Please refer to the corrective action plan on page 100.

Statement of Condition – For the Low Rent Public Housing Program, we reviewed 40 tenant files (recertification files and new tenant files) for fiscal year ended March 31, 2025. We reviewed 13 files for tenants who moved out during the fiscal year ended March 31, 2025. The selected files represented a sample of all files in the three AMPS. We noted 1 instance in which income from wages was incorrectly calculated in determining total tenant income. Criteria – Per the Public Housing Occupancy Guidebook (Section 3), “Annual income refers to all amounts…, which are made on behalf of the family’s HOH…”. Effect – For the file referenced above, net wages, rather than gross wages, were included in the calculation. As a result, total annual income was understated. The net effect of this error was an understatement of tenant rent of $138 per month. Cause – Incorrect procedures were followed in regards to calculating total tenant income. Recommendation – Procedures surrounding tenant rent calculation processes should be strengthened. Views of responsible officials and planned corrective actions – The Authority agrees with this finding. Please refer to the corrective action plan on page 100.

Statement of Condition – For the Low Rent Public Housing Program, we reviewed the budget for spending authorizations. During this review, it was discovered that the Authority had not budgeted for $23,494 in program expenditures for the year ended March 31, 2025. This resulted in unfavorable budget variances within the program. Criteria – NC General Statutes require that the Authority budget appropriately for all expenditures. Effect – This violation resulted in overspending in budgeted line appropriations. Cause – The Authority did not follow proper budgeting procedures. Recommendation – The Authority should review budget versus actual expenditures on a regular basis and should amend the budget as spending needs arise. Before an obligation is incurred that will exceed the amount that was previously approved in the budget ordinance, an amendment to the budget should be adopted. Views of responsible officials and planned corrective actions – The Authority agrees with this finding. Please refer to the corrective action plan on page 100.

Statement of Condition – For the Housing Choice Voucher Program, we reviewed 40 files (recertification files and new files) for fiscal year ended March 31, 2025. We reviewed 5 files for families who moved out during the fiscal year ended March 31, 2025. We noted 1 instance in which an incorrect utility allowance was used in determining total tenant income. Criteria – Per the Housing Choice Voucher Program Guidebook (Utility Allowances), “When calculating the utility allowance for a family, the PHA must use the lower of the unit size leased or the family’s voucher size determined the PHA’s subsidy standards…” Effect – For the files referenced above, the Authority used an incorrect unit size in calculating the utility allowance. As a result, the monthly housing assistance payment was overstated by $41 per month. Cause – Incorrect procedures were followed in regards to calculating total family income. Recommendation – Procedures surrounding family income recertification processes should be strengthened. Views of responsible officials and planned corrective actions – The Authority agrees with this finding. Please refer to the corrective action plan on page 100.