FAC Explorer

Audit 7804

FY End
2023-03-31
Total Expended
$33.76M
Findings
4
Programs
8
Organization: Somerville Housing Authority (MA)
Year: 2023 Accepted: 2023-12-20
Auditor: Rector Reeder & Lofton PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
5735 2023-001 Significant Deficiency - E
5736 2023-001 Significant Deficiency - E
582177 2023-001 Significant Deficiency - E
582178 2023-001 Significant Deficiency - E

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $24.33M Yes 1
14.182 Section 8 New Construction and Substantial Rehabilitation $3.06M Yes 0
14.850 Public and Indian Housing $2.57M Yes 0
14.879 Mainstream Vouchers $2.03M Yes 1
14.872 Public Housing Capital Fund $1.43M Yes 0
14.896 Family Self-Sufficiency Program $143,991 - 0
14.249 Section 8 Moderate Rehabilitation Single Room Occupancy $128,340 Yes 0
14.870 Resident Opportunity and Supportive Services - Service Coordinators $79,200 - 0

Contacts

Name Title Type
HKNFBGSHG2H3 Kelly Yin Auditee
6176251152 Dale R. Rector Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of the Authority under programs of the federal government for the year ended March 31, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Authority.
Title: SUBRECIPIENTS Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10% de minimis cost rate. The Authority provided no federal awards to subrecipients during the fiscal year ending March 31, 2023.
Title: DISCLOSURE OF OTHER FORMS OF ASSISTANCE Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10% de minimis cost rate. The Authority received no federal awards to subrecipients during the fiscal year ended March 31, 2023. The Authority had no loans outstanding which were guaranteed, and therefore, qualify as part of the federal financial assistance. The Authority maintains the following limits of insurance as of March 31, 2023:  Property $159,986,745  Liability $1,000,000  Workers Comp $1,000,000  Employee Fraud and Dishonesty $250,000  Flood $250,000 Settled claims have not exceeded the above commercial insurance coverage limits over the past three years.

Finding Details

Finding 2023-001
Finding 2023-001 – Housing Choice Voucher Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Section 8 Housing Choice Voucher Cluster – ALNs #14.871 and #14.879 Condition & Cause: We reviewed sixty-five (65) Housing Choice Voucher tenant files and noted seven (7) files not in compliance, or 10.8%. For three (3) of the files, we noted that the reexaminations in review were not maintained with the tenant documentation. Upon further inquiry, the Authority was unable to provide the documentation for the missing actions. The HAP paid during the fiscal year from the three (3) undocumented actions is the basis for the questioned costs. For the remaining four (4) files, we noted that the verification of income was either missing or outdated. We noted that the Authority experienced high staff turnover and has had difficulty in hiring and retaining employees. As of August 2023, subsequent to year-end, the Authority has contracted with an outside vendor to assist with tenant certifications. Criteria: The Code of Federal Regulations, the Authority’s Administrative Plan, and specific HUD guidelines in documenting and maintaining Housing Choice Voucher tenant files. Effect: Improper verification and documentation of tenant reexaminations can result in misstatement of the financial statements, improper calculation of HAP subsidy, and noncompliance with Federal provisions governing the Housing Choice Voucher program. Recommendation: We recommend that the Authority conduct a file audit of existing tenants to determine the extent of the deficiencies. We also recommend that the Authority implement a quality control review to adequately monitor compliance with regulations pertaining to the maintenance of tenant files. Questioned Costs: $46,655 Repeat Finding: No Was sampling statistically valid? Yes
Finding 2023-001
Finding 2023-001 – Housing Choice Voucher Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Section 8 Housing Choice Voucher Cluster – ALNs #14.871 and #14.879 Condition & Cause: We reviewed sixty-five (65) Housing Choice Voucher tenant files and noted seven (7) files not in compliance, or 10.8%. For three (3) of the files, we noted that the reexaminations in review were not maintained with the tenant documentation. Upon further inquiry, the Authority was unable to provide the documentation for the missing actions. The HAP paid during the fiscal year from the three (3) undocumented actions is the basis for the questioned costs. For the remaining four (4) files, we noted that the verification of income was either missing or outdated. We noted that the Authority experienced high staff turnover and has had difficulty in hiring and retaining employees. As of August 2023, subsequent to year-end, the Authority has contracted with an outside vendor to assist with tenant certifications. Criteria: The Code of Federal Regulations, the Authority’s Administrative Plan, and specific HUD guidelines in documenting and maintaining Housing Choice Voucher tenant files. Effect: Improper verification and documentation of tenant reexaminations can result in misstatement of the financial statements, improper calculation of HAP subsidy, and noncompliance with Federal provisions governing the Housing Choice Voucher program. Recommendation: We recommend that the Authority conduct a file audit of existing tenants to determine the extent of the deficiencies. We also recommend that the Authority implement a quality control review to adequately monitor compliance with regulations pertaining to the maintenance of tenant files. Questioned Costs: $46,655 Repeat Finding: No Was sampling statistically valid? Yes
Finding 2023-001
Finding 2023-001 – Housing Choice Voucher Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Section 8 Housing Choice Voucher Cluster – ALNs #14.871 and #14.879 Condition & Cause: We reviewed sixty-five (65) Housing Choice Voucher tenant files and noted seven (7) files not in compliance, or 10.8%. For three (3) of the files, we noted that the reexaminations in review were not maintained with the tenant documentation. Upon further inquiry, the Authority was unable to provide the documentation for the missing actions. The HAP paid during the fiscal year from the three (3) undocumented actions is the basis for the questioned costs. For the remaining four (4) files, we noted that the verification of income was either missing or outdated. We noted that the Authority experienced high staff turnover and has had difficulty in hiring and retaining employees. As of August 2023, subsequent to year-end, the Authority has contracted with an outside vendor to assist with tenant certifications. Criteria: The Code of Federal Regulations, the Authority’s Administrative Plan, and specific HUD guidelines in documenting and maintaining Housing Choice Voucher tenant files. Effect: Improper verification and documentation of tenant reexaminations can result in misstatement of the financial statements, improper calculation of HAP subsidy, and noncompliance with Federal provisions governing the Housing Choice Voucher program. Recommendation: We recommend that the Authority conduct a file audit of existing tenants to determine the extent of the deficiencies. We also recommend that the Authority implement a quality control review to adequately monitor compliance with regulations pertaining to the maintenance of tenant files. Questioned Costs: $46,655 Repeat Finding: No Was sampling statistically valid? Yes
Finding 2023-001
Finding 2023-001 – Housing Choice Voucher Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Section 8 Housing Choice Voucher Cluster – ALNs #14.871 and #14.879 Condition & Cause: We reviewed sixty-five (65) Housing Choice Voucher tenant files and noted seven (7) files not in compliance, or 10.8%. For three (3) of the files, we noted that the reexaminations in review were not maintained with the tenant documentation. Upon further inquiry, the Authority was unable to provide the documentation for the missing actions. The HAP paid during the fiscal year from the three (3) undocumented actions is the basis for the questioned costs. For the remaining four (4) files, we noted that the verification of income was either missing or outdated. We noted that the Authority experienced high staff turnover and has had difficulty in hiring and retaining employees. As of August 2023, subsequent to year-end, the Authority has contracted with an outside vendor to assist with tenant certifications. Criteria: The Code of Federal Regulations, the Authority’s Administrative Plan, and specific HUD guidelines in documenting and maintaining Housing Choice Voucher tenant files. Effect: Improper verification and documentation of tenant reexaminations can result in misstatement of the financial statements, improper calculation of HAP subsidy, and noncompliance with Federal provisions governing the Housing Choice Voucher program. Recommendation: We recommend that the Authority conduct a file audit of existing tenants to determine the extent of the deficiencies. We also recommend that the Authority implement a quality control review to adequately monitor compliance with regulations pertaining to the maintenance of tenant files. Questioned Costs: $46,655 Repeat Finding: No Was sampling statistically valid? Yes