Audit 399753

Finding 2025-002: HOTMA Housing Choice Voucher – 14.871 Material Weakness/Noncompliance – Eligibility Criteria: The Housing Opportunity Through Modernization Act of 2016 (HOTMA), as implemented through HUD regulations and guidance, required public housing agencies administering the Housing Choice Voucher (HCV) program to adopt and implement certain HOTMA provisions no later than July 1, 2025. Public housing agencies are responsible for ensuring program policies, procedures, and operations are updated timely to comply with HUD requirements. Condition: The Housing Authority did not implement the required HOTMA provisions applicable to the Housing Choice Voucher program by the required effective date of July 1, 2025. As a result, the Authority administered the Housing Choice Voucher program for approximately two months without full compliance with HUD’s HOTMA implementation requirements. Cause: The Authority did not have adequate internal controls in place to ensure timely adoption and implementation of new HUD regulatory requirements and management was under the impression these requirements had been delayed. Effect or Potential Effect: Failure to timely implement HOTMA requirements increases the risk that the Housing Choice Voucher program was not administered in full compliance with HUD regulations during the period from July 1, 2025 through September 2025. It should be noted we noted no instance of noncompliance as a result of this failure during our testing. Recommendation: We recommend that the Housing Authority continue to monitor HUD regulatory updates and establish procedures to ensure timely adoption and implementation of future program requirements. Management should also ensure that updated policies and procedures are reviewed and approved prior to required effective dates to maintain compliance with HUD and Uniform Guidance requirements. View of the Responsible Officials of the Auditee: The auditee’s management agrees with the finding.