Corrective Action Plans

Finding 1214414 (2025-004)

Material Weakness 2025

The Housing and Redevelopment Commission of the City of Aberdeen, Sd

SD

HUD Housing Programs

Finding 2025-004 Federal Agency Name – Department of Housing and Urban Development Assistance Listing Number – 14.871 & 14.879 Program Name – Housing Voucher Cluster Finding Summary: The Commission’s control in place for review of the tenant’s rent payment used for tenant files on annual reviews was...

Finding 2025-004 Federal Agency Name – Department of Housing and Urban Development Assistance Listing Number – 14.871 & 14.879 Program Name – Housing Voucher Cluster Finding Summary: The Commission’s control in place for review of the tenant’s rent payment used for tenant files on annual reviews was not operating effectively. In seven of the 60 tenant files tested, the tenant’s payment amounts were calculated incorrectly. Five of the seven files with errors would have been de minimis errors which the compliance supplement notes as an error of less than $30 per month. Also, two tenants’ social security number documentation in the tenant files did not match Form 50058. Responsible Individuals: Brett Bill, Executive Director Corrective Action Plan: The Commission has had recent turnover in the Section 8 Program. Additional training will be provided to new staff to ensure that they are aware of program requirements. Anticipated Completion Date: 5/1/2026

View Audit 401098

Finding 1214412 (2025-003)

Material Weakness 2025

The Housing and Redevelopment Commission of the City of Aberdeen, Sd

SD

Allowable Costs / Cost Principles HUD Housing Programs Reporting

Finding 2025-003 Federal Agency Name – Department of Housing and Urban Development Assistance Listing Number – 14.871 & 14.879 Program Name – Housing Voucher Cluster Finding Summary: The Commission has a process in place for employees to track hours worked to federal and non-federal programs but pay...

Finding 2025-003 Federal Agency Name – Department of Housing and Urban Development Assistance Listing Number – 14.871 & 14.879 Program Name – Housing Voucher Cluster Finding Summary: The Commission has a process in place for employees to track hours worked to federal and non-federal programs but payroll allocations are made based on budgets expectations, not actual, and review is not occurring to determine if allocations need to be updated throughout the Responsible Individuals: Brett Bill, Executive Director Corrective Action Plan: Processes will be updated to ensure that payroll allocations are being compared to allocations to ensure they are correctly allocated. Anticipated Completion Date: 5/1/2026

View Audit 401098

Finding 1214404 (2025-001)

Material Weakness 2025

Housing Opportunities Team, INC

OR

HUD Housing Programs

Name of contact person: Matthew Wrigley, Accounting Financial and Audit Manager Plan: The 2025 reserve deficit was resolved 4/30/26. The monthly internal reserve transfers are tracked for each site and included in a monthly csv transfer import when cashflow proves viable. There are monthly reminders...

Name of contact person: Matthew Wrigley, Accounting Financial and Audit Manager Plan: The 2025 reserve deficit was resolved 4/30/26. The monthly internal reserve transfers are tracked for each site and included in a monthly csv transfer import when cashflow proves viable. There are monthly reminders and a schedule in place to review cash and initiate for all sites. In the event the transfer fails to occur, the liability is either accrued or independently tracked. From there, we continue to monitor the cashflow for feasibility and attempt to resolve any overdue transfers. To ensure compliance, non-essential payables will be withheld from processing. Mortgages, utilities, and insurance will be considered as essential to mitigate critical fees, cancellations, or shut-offs. These procedures are already in place as of 2026. Date of planned corrective action: April 30, 2026

View Audit 401063

Finding 1214234 (2025-009)

Material Weakness 2025

ATLANTIC CITY HOUSING AUTHORITY & URBAN REDEVELOPMENT AGENCY

CA

HUD Housing Programs Questioned Costs Special Tests & Provisions

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 and 14.EHV Noncompliance – N. Special Tests and Provisions - Reasonable Rent Non Compliance Material to the Financial Statements: No Significant Deficiency...

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 and 14.EHV Noncompliance – N. Special Tests and Provisions - Reasonable Rent Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: Reasonable Rent. The Authority must do the following: The Authority must determine that the rent to owner is reasonable at the time of initial leasing. Also, the Authority must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5 percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The Authority must maintain records to document the basis for the determination that rent to owner is a reasonable rent (initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition: Based upon inspection of the Authority’s files and discussion with management, the Authority did not have procedures or software in place to perform the required evaluation of rent reasonableness. Context: There were approximately fifteen(15) newly leased units in the Emergency Housing Vouchers Program. Of a sample size of two (2) newly leased units in the Emergency Housing Vouchers Program, two (2) unit's documentation of reasonable rent was not available for examination. Our sample size is statistically valid. Known Questioned Costs: Unknown Cause: There is a significant deficiency in internal controls over the compliance for the special tests and provisions type of compliance related to reasonable rent. The Authority experienced high turnover and did not properly train employees in the HCV department, which resulted in the Authority having a limited capacity to perform rent reasonableness calculations and properly maintain and monitor a system of internal controls that reasonably assures the program is in compliance with program requirements. Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the special tests and provisions type of compliance related to reasonable rent. Recommendation: We recommend that the Authority establish a software and implement a process whereby Authority personnel are hired and trained on performing the appropriate rent reasonableness procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the deficiencies in the Section 8 Housing Voucher Cluster Programs and will train staff on rent reasonableness and implement internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.

View Audit 400937

Finding 1214233 (2025-007)

Material Weakness 2025

ATLANTIC CITY HOUSING AUTHORITY & URBAN REDEVELOPMENT AGENCY

CA

HUD Housing Programs Questioned Costs Special Tests & Provisions

Finding 2025-007: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 and 14.EHV Noncompliance – N. Special Tests and Provisions – HQS Enforcement Non Compliance Material to the Financial Statements: Yes Sig...

Finding 2025-007: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 and 14.EHV Noncompliance – N. Special Tests and Provisions – HQS Enforcement Non Compliance Material to the Financial Statements: Yes Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: HQS Enforcement. The PHA must inspect the unit leased to a family at least annually to determine if the unit meets the Housing Quality Standards (HQS) and the Authority must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). For units that fail inspection the PHA must correct all life threatening HQS deficiencies within 24 hours and all other deficiencies within 30 days. If deficiencies are not correcting in the required time period, the Authority must abate housing assistance payments in accordance with their admin plan. Condition: Based upon inspection of the Authority’s files and on discussions with management, the Authority did not provide support for two (2) failed inspections. Context: Of a sample size of two (2) failed inspections, the Authority did not provide support for two (2) failed inspections selected for testing, and did not abate housing assistance payments for the two (2) units selected. As a result, the Authority was not in compliance with the HQS as required by 24 CFR sections 982.158(d) and 982.405(b). Known Questioned Costs: $31,548 Cause: There is a significant deficiency in internal controls over compliance for the special tests and provisions type of compliance related to HQS enforcement due to high turnover. Effect: The Housing Voucher Cluster Programs are in material non-compliance with the special tests and provisions type of compliance related to HQS enforcement. Recommendation: We recommend that the Authority implement a process whereby Authority personnel are hired and trained on HQS enforcement that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the deficiencies in the Housing Voucher Cluster Programs and has implemented a process to prevent the same issues from occurring. The Authority will also continue to train staff on HQS enforcement and enhance it's internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.

View Audit 400937

Finding 1214232 (2025-006)

Material Weakness 2025

ATLANTIC CITY HOUSING AUTHORITY & URBAN REDEVELOPMENT AGENCY

CA

Questioned Costs Special Tests & Provisions HUD Housing Programs

Finding 2025-006: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 & 14.EHV Noncompliance – N. Special Tests and Provisions - Housing Quality Standards Non Compliance Material to the Financial Statements:...

Finding 2025-006: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Federal Catalog Numbers: 14.871 & 14.EHV Noncompliance – N. Special Tests and Provisions - Housing Quality Standards Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Special Tests and Provisions Criteria: Criteria: HQS Inspections. Per the Authority's HCV Admin Plan, the PHA must inspect the unit leased to a family at least annually to determine if the unit meets HQS standards and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). These inspection reports are required to be maintained and available for examination at the time of audit. Condition: Based upon inspection of the Authority’s files and on discussion with management there were inspection reports that were unavailable for examination at the time of audit. Context: Of a sample size of twenty-four (24) units, thirteen (13) units did not have annual HQS inspections performed timely. Our sample size is statistically valid. Known Questioned Costs: $131,112 Cause: There is a material weakness in internal controls over the compliance for the special tests and provisions type of compliance related to HQS inspections. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance. Effect: The Housing Voucher Cluster is in material non-compliance with the with the special tests and provisions type of compliance related to HQS inspections. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance related to HQS inspections in accordance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the significant deficiency in the Housing Voucher Cluster Programs and will implement internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.

View Audit 400937

Finding 1214231 (2025-005)

Material Weakness 2025

ATLANTIC CITY HOUSING AUTHORITY & URBAN REDEVELOPMENT AGENCY

CA

HUD Housing Programs Questioned Costs Eligibility

Finding 2025-005: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Assistance Listing Numbers: 14.871 and 14.EHV Non Compliance - E. Eligibility - Tenant Files Non Compliance Material to the Financial Statements: Yes Material Weakness i...

Finding 2025-005: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster Assistance Listing Numbers: 14.871 and 14.EHV Non Compliance - E. Eligibility - Tenant Files Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Eligibility Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). These files are required to be maintained and available for examination at the time of audit. Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit. Context: There are approximately 1,056 units. Of a sample size of twenty-four (24) tenant files, the following was noted:  HUD form 9886 was unable to be provided in 6 files - Verification of income was unable to be provided in 2 files - HUD-50058 form was unavailable for review in 4 files - Citizen Declaration Section 214 form was unable to be provided in 9 files - Signed leases were unable to be provided in 8 files - Original application was missing in 2 files - Lead based paint forms were missing 2 files - The Authority was unable to provide 1 tenant file during the time of audit. Known Questioned Costs: $ 149,640 Cause: There is a material weakness in the Housing Voucher Cluster in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority experienced high turnover and did not properly train employees in the HCV department, which resulted in the Authority having a limited capacity to perform the required maintenance of tenant files, and properly maintain and monitor a system of internal controls that reasonably assures the program is in compliance. Effect: The Housing Voucher Cluster Programs are in material non-compliance with the eligibility requirements of the programs. Recommendation: We recommend that the Authority implement a process whereby Authority personnel are hired and trained on tenant file maintenance so that documents are accumulated, stored and safeguarded to ensure compliance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the deficiencies in the Housing Voucher Cluster Programs and will train staff on the proper maintenance of tenant files and implement internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.

View Audit 400937

Finding 1214230 (2025-008)

Material Weakness 2025

ATLANTIC CITY HOUSING AUTHORITY & URBAN REDEVELOPMENT AGENCY

CA

HUD Housing Programs Questioned Costs Eligibility

Finding 2025-008: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Public and Indian Housing Program Federal Catalog Numbers: 14.850 Material Noncompliance Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Comp...

Finding 2025-008: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Public and Indian Housing Program Federal Catalog Numbers: 14.850 Material Noncompliance Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Eligibility Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). These files are required to be maintained and available for examination at the time of audit. Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit. Context: There are approximately 1,086 units. Of a sample size of twenty-four (24) tenant files, the following was noted: - Citizenship declaration was missing in 1 file - HUD-9886 form was missing in 5 files - Signed lease was missing in 1 file. Our sample size is statistically valid. Known Questioned Costs: $48,870 Cause: There is a material weakness in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority experienced high turnover and did not properly train employees in the Public and Indian Housing department, which resulted in the Authority having a limited capacity to perform the required maintenance of tenant files, and properly maintain and monitor a system of internal controls that reasonably assures the program is in compliance. Effect: The Public and Indian Housing Program is in material non-compliance with the eligibility type of compliance related to the maintenance of tenant files. Recommendation: We recommend that the Authority implement a process whereby Authority personnel are hired and trained on tenant file maintenance so that documents are accumulated, stored and safeguarded to ensure compliance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the deficiencies in the Public Housing Program and will train staff on the proper maintenance of tenant files and implement internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.

View Audit 400937

Finding 1214224 (2025-002)

Material Weakness 2025

Community Housing Iii, Inc. Fir Grove Apartments

OR

HUD Housing Programs Special Tests & Provisions Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures a...

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to insure that move out inspections are performed timely, security deposits are returned timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to return security deposits in a timely manner but was delayed in issuing the security deposit refund for this unit due to staffing issues. In 2026 property management will be outsourced to a third-party management company to address any outstanding compliance issues.

View Audit 400934

Finding 1214222 (2025-001)

Material Weakness 2025

Community Housing Iii, Inc. Fir Grove Apartments

OR

Eligibility HUD Housing Programs Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures a...

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to insure that EIVs and recertifications are performed timely, inspections are completed, waitlists are being completed and followed, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to complete certifications in a timely manner but due to staffing shortages at the property continued to have issues with timely completion of income certifications in 2025. In 2026 property management will be outsourced to a third-party management company to address outstanding compliance issues.

View Audit 400934

Finding 1214220 (2025-003)

Material Weakness 2025

Community Housing Ii, Inc. the Maples II Apartments

OR

Eligibility HUD Housing Programs Special Tests & Provisions

Federal Award Findings and Questioned Costs Item 2025-003 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor com...

Federal Award Findings and Questioned Costs Item 2025-003 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that the determination of tenant eligibility and the maintenance of lease files are in accordance with guidelines specified by HUD. Action Taken: REACH has policies in place to complete move in inspections but due to tenant noncompliance and staffing issues this inspection was missed. Management scheduled training with staff in March 2026.

View Audit 400933

Finding 1214218 (2025-002)

Material Weakness 2025

Community Housing Ii, Inc. the Maples II Apartments

OR

HUD Housing Programs Special Tests & Provisions Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor com...

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that move out inspections are performed timely, security deposits are returned timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to return security deposits in a timely manner but was slightly delayed in issuing the security deposit refund for this unit. Management reviewed with the teams to ensure rent refunds would be processed within 30 days.

View Audit 400933

Finding 1214216 (2025-001)

Material Weakness 2025

Community Housing Ii, Inc. the Maples II Apartments

OR

Eligibility HUD Housing Programs Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor com...

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that EIVs are performed timely, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to complete EIVs and recertifications in a timely manner but due to staffing shortages and tenant noncompliance issues the property continued to have issues with timely completion of income certifications in 2025. In 2026 property management will be outsourced to third party management company to address outstanding compliance issues.

View Audit 400933

Finding 1214214 (2025-002)

Material Weakness 2025

Powell Boulevard Apartments, Inc.

OR

HUD Housing Programs Subrecipient Monitoring Allowable Costs / Cost Principles

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Program Federal Assistance Listing Number: 14.181 Recommendation: Management should review the HUD...

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Program Federal Assistance Listing Number: 14.181 Recommendation: Management should review the HUD-52670 and HUD-52670-A every month to ensure that it contains the correct tenants and amounts requested. Action Taken: REACH has policies in place to ensure that HAP funds received are only for current tenants. Due to staffing issues there was a delay in updating the HAP contract. All excess funds received will be returned to HUD.

View Audit 400931

Finding 1214212 (2025-001)

Material Weakness 2025

Powell Boulevard Apartments, Inc.

OR

Eligibility HUD Housing Programs Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Program Federal Assistance Listing Number: 14.181 Recommendation: Management should establish proc...

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Program Federal Assistance Listing Number: 14.181 Recommendation: Management should establish procedures and monitor compliance with those procedures to insure that recertifications are performed timely and signed, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to complete certifications and EIVs in a timely manner but due to staffing shortages at the property continued to have issues with timely completion of income certifications in 2025. In 2026 property management will be outsourced to a third party management company to address outstanding compliance issues.

View Audit 400931

Finding 1214206 (2025-002)

Material Weakness 2025

Community Housing, Inc.

OR

Special Tests & Provisions Questioned Costs Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should address all deficienci...

Federal Award Findings and Questioned Costs Item 2025-002 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should address all deficiencies identified in the NSPIRE Physical Inspection in a timely manner to ensure compliance with HUD regulations. Action Taken: REACH has policies in place to address deficiencies identified in the NSPIRE Physical Inspections but due to staffing shortages was having issues addressing them in a timely manner. REACH has cleared all deficiencies and submitted all requested materials to HUD and is awaiting the close-out confirmation letter.

View Audit 400927

Finding 1214204 (2025-001)

Material Weakness 2025

Community Housing, Inc.

OR

Eligibility HUD Housing Programs Subrecipient Monitoring

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures a...

Federal Award Findings and Questioned Costs Item 2025-001 Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Federal Assistance Listing Number: 14.157 Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that recertifications are performed timely and signed, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Action Taken: REACH has policies in place to complete EIVs and recertifications in a timely manner but due to staffing shortages and tenant noncompliance issues the property continued to have issues with timely completion of income certifications in 2025. In 2026 property management will be outsourced to third party management company to address outstanding compliance issues.

View Audit 400927

Finding 1214160 (2025-031)

Material Weakness 2025

Commonwealth of Massachusetts

MA

Eligibility Questioned Costs Student Financial Aid § 200.303

2025-031 Adoption Assistance 93.659 Recommendation: The Department should enhance its procedures and internal controls to ensure it maintains documentation of participant eligibility and child abuse and neglect registry checks, and that this documentation is readily available for audit. We also reco...

2025-031 Adoption Assistance 93.659 Recommendation: The Department should enhance its procedures and internal controls to ensure it maintains documentation of participant eligibility and child abuse and neglect registry checks, and that this documentation is readily available for audit. We also recommend the Department enhance the renewal letter to include the reaffirmation of the original subsidy agreement date by the participant. Action taken in response to finding: For the finding related to signed adoption subsidy agreements, the Department has already implemented corrective actions to improve its process of maintaining signed adoption subsidy agreements. We built the capacity to upload electronic documents into iFamilyNet in July 2022, and we now ensure that all prospectively signed agreements are uploaded into the child’s iFamilyNet record. In addition, since July 2023, during the Title IV-E eligibility determination process, the eligibility specialist verifies that the signed adoption subsidy agreement has been uploaded. The Department will also explore the auditor’s recommendation to enhance the renewal letter to include the reaffirmation of the original subsidy agreement date by the participant to see if it is technically feasible. Although the Department was unable to produce a copy of a signed subsidy agreement, the Department has controls to oversee that a subsidy agreement was executed prior to legalization of the adoption through a built-in workflow process in our i-FamilyNet system. For the other 39 sample cases, the dates of the signatures by the Department and the pre-adoptive parents recorded in iFamilyNet matched the signature dates on the copies of the original signed agreements. Hence, the Department asserts the dates entered were accurate. We unfortunately could not produce the document to demonstrate that to the auditors. For the finding relating to out-of-state child welfare checks, the Department has already implemented corrective actions to improve its process of documenting requests of out-of-state child welfare checks. In February 2023, the Department integrated the out-of-state child welfare check into the Background Record Check (BRC) section of the foster home licensing process where it can be documented and included as part of the assessment. The Department also added a value to our “contact purpose” drop down menu within the dictation screen in iFamilyNet to capture structured data that an out-of-state child welfare check was made. Name(s) of the contact person(s) responsible for corrective action: Sharon Silvia, Assistant Commissioner of Permanency COMMONWEALTH OF MASSACHUSETTS CORRECTIVE ACTION PLAN YEAR ENDED JUNE 30, 2025 Planned completion date for corrective action plan: Signed Subsidy Agreements: • July 2022 – capacity to upload electronic documents into iFamilyNet (complete) • July 2023 – eligibility specialist verifies that the signed adoption subsidy agreement has been uploaded (complete) • July 2026 – assess technical feasibility of enhancing the renewal letter Out-of-State Child Welfare Checks: • February 2023 – integrated out-of-state child welfare checks into BRC section and added value to contact purpose drop down (complete)

View Audit 400886

Finding 1214077 (2025-001)

Material Weakness 2025

Ellery Court Senior Housing Development Fund Corporation

NY

Eligibility HUD Housing Programs Questioned Costs

Provided training to staff on HUD EIV requirements and documentation standards. Updated the tenant file checklist to include a mandatory EIV report verification step:  Conducted an internal audit of all tenant files to identify any additional missing or late EIV reports.  Implement a quarterly com...

Provided training to staff on HUD EIV requirements and documentation standards. Updated the tenant file checklist to include a mandatory EIV report verification step:  Conducted an internal audit of all tenant files to identify any additional missing or late EIV reports.  Implement a quarterly compliance review process to ensure ongoing adherence to EIV requirements.

View Audit 400881

Finding 1213964 (2025-001)

Material Weakness 2025

United Winthrop Tower Cooperative

IL

HUD Housing Programs Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN FOR AUDIT FINDING 2025-001 The Organization agrees with the finding. The Organization has agreed to start performing physical inspections again, as required by HUD. Contact: Kalisha France, Regional Property Manager Completion Date: March 5, 2026

View Audit 400819

Finding 1213946 (2025-005)

Material Weakness 2025

Knox Community Hospital and Subsidiaries

OH

HUD Housing Programs Questioned Costs Material Weakness

Condition: The Organization obtained a short term line of credit without formal approval from HUD from Park National Bank in 2024 with access to credit up to $15 million, which exceeds the limits in section 20b(iii) of the HUD agreement. Planned Corrective Action: On February 21, 2024, Change Health...

Condition: The Organization obtained a short term line of credit without formal approval from HUD from Park National Bank in 2024 with access to credit up to $15 million, which exceeds the limits in section 20b(iii) of the HUD agreement. Planned Corrective Action: On February 21, 2024, Change Healthcare / Optum sustained a cyber-attack and completely shut down claim’s submission processes for Knox Community Hospital. With over 3 weeks of not releasing insurance claims that amounted to over $40M, this impacted the cashflow greatly on the organization. The CFO at that time made the decision to seek a Line of Credit with Park National Bank for $15M to fund operations. Due to the urgency and short timeline, formal approval was not obtained from HUD. A detailed event log was maintained around the cyber-attack and provided to our Board and HUD representative. In the future, all regulatory agreements’ requirements will be reviewed by the CFO and in time there are new agreements or modifications made to existing agreements to ensure compliance with each agreement. HUD has since issued a letter approving KCH’s $15M Line of Credit. Contact person responsible for corrective action: Danielle O’Brien, CFO Anticipated Completion Date: 4/30/2026

View Audit 400796

Finding 1213945 (2025-003)

Material Weakness 2025

Brownstone Gardens Iii, Inc.

MA

HUD Housing Programs Eligibility

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-003: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends ensuring al...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-003: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends ensuring all tenant’s assets are verified at the time of recertification and documentation is maintained in the tenants’ file. Also, the tenant file related to the finding is recertified to determine if the proper tenant rent and HUD assistance payment were accurately calculated for the year ended December 31, 2025. ACTION TAKEN The Project will be continuing to train staff on the HUD Handbook requirements for the tenant files.

View Audit 400791

Finding 1213944 (2025-002)

Material Weakness 2025

Brownstone Gardens Iii, Inc.

MA

HUD Housing Programs Eligibility

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT (CONTINUED) Department of Housing and Urban Development Finding 2025-002: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT (CONTINUED) Department of Housing and Urban Development Finding 2025-002: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends ensuring all tenants’ paperwork is thoroughly reviewed and accurately used in the calculation of the tenant’s required monthly rent and HUD’s tenant assistance payments. ACTION TAKEN The Project billed HUD for the $540 of tenant assistance and will be reimbursing the tenant for the additional rent of $540. The Project will be billing the tenant for the $99 and reimbursing HUD for the additional tenant assistance of $99.

View Audit 400791

Finding 1213943 (2025-001)

Material Weakness 2025

Brownstone Gardens Iii, Inc.

MA

HUD Housing Programs Eligibility

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-001: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends ensuring al...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-001: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 RECOMMENDATION The auditor recommends ensuring all current staff are trained on HUD Handbook requirements for tenant files, including the EIV Existing Tenant Search report. ACTION TAKEN The Project will be continuing to train staff on the HUD Handbook requirements for tenant files.

View Audit 400791

Finding 1213942 (2025-003)

Material Weakness 2025

Brownstone Gardens, Inc.

MA

HUD Housing Programs

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-003: Major Program: Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, Federal Assistance Listing Number 14.155 RECOMMENDATION The auditor recommends ensuri...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding 2025-003: Major Program: Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, Federal Assistance Listing Number 14.155 RECOMMENDATION The auditor recommends ensuring all disbursements are thoroughly reviewed prior to authorizing the expense to be paid. ACTION TAKEN The Project will be reimbursed by the other project for the expense paid on its behalf.

View Audit 400790

Corrective Action Plans

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