Audit 397134

Finding 2025-001 Eligibility | Reporting | Special Tests and Provisions – Housing Assistance Payment ALN 14.871/14.879 Housing Voucher Cluster Criteria: Eligibility Pursuant to 24 CFR Sections 5.212 and 5.230, at each annual income reexamination the head of household is required to sign: one or more release forms to allow the PHA to obtain information from third parties, a federally prescribed general release form for employment information, and a privacy notice. Additionally, each member of the family of a participant who is at least 18 years of age, and each family head and spouse regardless of age, shall sign one or more consent forms. Pursuant to 24 CFR Sections 5.609, 982.201, 982.515, and 982.516, the PHA must conduct a reexamination of family income/composition, determine income eligibility, and calculate the tenant’s rent payment using documentation from third party verification at least annually. The family file must include third party verification of the reported family annual income, the value of assets, expenses related to deductions from annual income, and other factors that affect the determination of adjusted income or income-based rent. Pursuant to 24 CFR Section 5.233, processing entities must use HUD’s EIV system in its entirety as a third-party source to verify employment and income information during annual reexaminations and to reduce administrative and subsidy payment errors in accordance with HUD administrative guidance. Reporting Pursuant to 24 CFR Part 908 and Section 982.158, the PHA must maintain complete and accurate accounts and other records in Form HUD-50058. This form is required to be submitted to HUD each time the PHA completes an issuance, admission, annual reexamination, portability move-in, expiration, or other change of unit for a family. Supporting documentation must also be retained during the term of each assisted lease, and for a period of at least 3 years from the end of participation date. Special Tests and Provisions – Housing Assistance Payment Pursuant to 24 CFR Section 982.158 and Part 982, Subpart K, the PHA must conduct a reexamination of family income and composition at least annually and pay the owner the lesser of the housing assistance payment calculated on line 12u of the HUD-50058 form or total rent to owner. Condition: For 2 of 40 clients selected for testing, the annual reexamination of family income/composition and supporting documentation was not provided, so testing of the annual reexamination could not be supported by appropriate documentation. Cause: The Authority’s internal control procedures to ensure compliance with Eligibility, Reporting, and Special Tests and Provisions - Housing Assistance Payment requirements were not operating as designed. Effect: The Authority was not in compliance with program Eligibility, Reporting, and Special Tests and Provisions – Housing Assistance Payment requirements and controls were not operating effectively. This finding was a repeat of Finding 2024-002 from the previous year. Questioned Costs: The amount of questioned costs is $5,520. Recommendation: The Authority should implement controls to ensure required documentation is retained and available for review and that annual reexaminations are properly completed, documented, and maintained. Management’s Response: Management agrees with the finding and is implementing procedures to correct it.The Housing Authority agrees with the finding and is implementing procedures to correct it. Applicable staff will be briefed on the finding and training will be provided on both written policy and procedure. The Housing Authority has a quality assurance program to monitor and ensure all clients complete an annual family income reexamination in accordance with Eligibility, Reporting, and Housing Assistance Payment requirements.

Finding 2025-002 Special Tests and Provisions – Reasonable Rent ALN 14.871/14.879 Housing Voucher Cluster Criteria: Pursuant to 24 CFR 982.158(f)(7) the Authority is required to keep records to document the basis for PHA’s determination that rent to owner is a reasonable rent (initially and during the term of a HAP contract). Condition: For 2 of 40 clients selected for testing, the rent reasonableness documentation was not provided, and the contracted rent amount could not be supported by rent reasonableness documentation. Cause: The Authority’s internal control procedures to ensure compliance with Special Tests and Provisions – Rent Reasonableness requirements were not operating as designed. Effect: The Authority was not in compliance with program’s Special Tests and Provisions – Rent Reasonableness requirements and controls were not operating effectively. Questioned Costs: The amount of questioned costs is $5,520, as noted in Finding 2025-001. Recommendation: The Authority should implement controls to ensure required documentation is retained and available for review and that annual reexaminations are properly completed and documented. Management’s Response: Management agrees with the finding and is implementing procedures to correct it. The Housing Authority agrees with the finding and is implementing procedures to correct it. Applicable staff will be briefed on the finding and training will be provided on both written policy and procedure. The Housing Authority has a quality assurance program to monitor and ensure all client files contain documentation ensuring compliance with Rent Reasonableness requirements.

Finding 2025-003 Reporting ALN 14.871/14.879 Housing Voucher Cluster Criteria: Pursuant to 24 CFR Part 908 and Section 982.158, the PHA must maintain complete and accurate accounts and other records in Form HUD-50058. This form is required to be submitted to HUD each time the PHA completes an issuance, admission, annual reexamination, portability move-in, expiration, or other change of unit for a family. Supporting documentation must also be retained during the term of each assisted lease, and for a period of at least 3 years from the end of participation date. Condition: For 1 of 40 clients selected for testing, the key line items of 3e – Date of Birth and 3n – Social Security Number for a dependent of a client were incorrect when compared to supporting documentation. Cause: The Authority’s internal control procedures to ensure compliance with Reporting requirements were not operating as designed. Effect: The Authority was not in compliance with program Reporting requirements and controls were not operating effectively. Questioned Costs: None. Recommendation: The Authority should ensure the HUD-50058 Reports contain accurate information. Management’s Response: Management agrees with the finding and is implementing procedures to correct it. The Housing Authority agrees with the finding and is implementing procedures to correct it. Applicable staff will be briefed on the finding and training will be provided on both written policy and procedure. The Housing Authority has a quality assurance program to monitor and ensure all client HUD-50058 reports are completed accurately.