Corrective Action Plans

Finding 569679 (2024-003)

Material Weakness 2024

CA

HUD Housing Programs Allowable Costs / Cost Principles Eligibility

Program: Section 8 Housing Choice Voucher Finding: 2024-003 Contact Person: Michelle Mel-Duch Housing Administrative and Financial Services Officer Health & Human Services Department Phone: (562) 570-5344 Email: Michelle.Mel-Duch@longbeach.gov Planned Actions: 1. Staff Augmentation and Training: ...

Program: Section 8 Housing Choice Voucher Finding: 2024-003 Contact Person: Michelle Mel-Duch Housing Administrative and Financial Services Officer Health & Human Services Department Phone: (562) 570-5344 Email: Michelle.Mel-Duch@longbeach.gov Planned Actions: 1. Staff Augmentation and Training: o In January 2025, HACLB submitted requisitions to the Human Resources Department to recruit additional Housing Specialists to improve the management of high volume HCV program participants, documentations, processes, and to meet various requirement deadlines. o As of May 3, 2025, four new Housing Specialists have been hired and are currently undergoing training. Four additional Housing Specialists are in the onboarding process with Human Resources Department. o Several supervisory positions remain unfilled due to the need to renew the hiring list. HACLB has submitted a request to initiate the renewal process in order to recruit from a new list. o In addition, HACLB has hired a Housing Administrative and Financial Services Officer and a Housing Operations Program Officer. These roles are critical in providing oversight of operational workflows, evaluating staff productivity, and developing strategies to optimize staffing levels and resource allocation. 2. Contracted Support Services: o To address a backlog of overdue reexaminations, HACLB renewed its contract with an external agency to provide dedicated assistance in processing pending cases. This contract became effective in May 2025 and has already begun to support the reexamination workload. 3. Technology Upgrade: o HACLB has transitioned to a new housing software platform tailored to improve the tracking and processing of annual recertifications. This system upgrade enhances productivity monitoring, facilitates efficient workflow management, and supports compliance with HUD timeliness standards. Expected Completion Date: September 30, 2026

View Audit 361021

Finding 569673 (2024-002)

Material Weakness 2024

City of Long Beach

CA

Subrecipient Monitoring Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties § 200.303

Program: HOME Investment Partnerships Program (HOME) Finding: 2024-002 Contact Person: April Apodaca Administrative & Financial Services Bureau Manager Community Development Department Phone: (562) 570-6611 Email: April.Apodaca@longbeach.gov Planned Actions: The City has increased the number of p...

Program: HOME Investment Partnerships Program (HOME) Finding: 2024-002 Contact Person: April Apodaca Administrative & Financial Services Bureau Manager Community Development Department Phone: (562) 570-6611 Email: April.Apodaca@longbeach.gov Planned Actions: The City has increased the number of properties inspected each fiscal year. For example, during the FY23 audit period, 204 inspections occurred. In the FY24 period, the number of inspections increased to 227. As of May 2025, the City has inspected 187 units and anticipates a total of 250 inspections will be completed by the end of FY25, thereby eliminating the current backlog and any late inspections. The Community Development Department implemented more proactive measures, including hiring an in-house inspector and an active master inspection log to track and target upcoming inspections. These efforts have resulted in a more streamlined, data-informed approach to HQS compliance, as evidenced by a significant reduction in the inspection backlog. The master inspection log is also being leveraged to optimize inspection scheduling and ensure that the required HOME units per property are inspected as required. To reinforce this approach, the City instituted a structured, monthly review of the log to improve data accuracy, completeness, and early identification of potential delays. The City is confident that these measures will demonstrate compliance with the HQS standards and resolve the auditor’s concerns. Expected Completion Date: 12/31/2025

View Audit 361021

Finding 569623 (2024-007)

Significant Deficiency 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Significant Deficiency Internal Control / Segregation of Duties

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-007: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 - Sig...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-007: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 - Significant Deficiency RECOMMENDATION The auditor recommends the Project and management review and attend training on the HUD Handbook. In addition, the auditor recommends the Project and management review its internal control policies and procedures. ACTION TAKEN Carrasquillo Management LLC acknowledges the significant deficiency noted and is committed to improving internal controls to ensure full compliance with all HUD program requirements. 1. Policy and Procedure Review Management has initiated a comprehensive review of internal control policies and procedures to identify gaps and align practices with the HUD Handbook 4350.3 and related program regulations. Updates will be made to strengthen compliance checkpoints and clearly define staff responsibilities for each stage of tenant file processing, income verification, certifications, and documentation retention. 2. Training and Capacity Building Carrasquillo Management LLC has committed to ongoing staff development by enrolling relevant personnel in HUD-compliant training programs focused on regulatory requirements, internal controls, and compliance best practices. All staff involved in leasing, recertifications, and program compliance will be required to complete refresher trainings at least annually. 3. Internal Audit and Quality Control A quarterly internal audit process has been established to monitor the effectiveness of internal controls and ensure consistent application across all major program functions. Findings from these audits will be reviewed by senior management, and corrective actions will be taken immediately when deficiencies are identified. 4. Oversight and Accountability Management will assign a dedicated compliance coordinator responsible for overseeing adherence to HUD regulations and internal policies, providing regular updates to leadership, and ensuring follow-through on all audit-related corrective actions. Carrasquillo Management LLC is committed to fostering a culture of compliance and accountability and will take all necessary steps to prevent future deficiencies and ensure the Project remains in good standing with HUD program requirements.

View Audit 361007

Finding 569622 (2024-006)

None 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Eligibility

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-006: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 REC...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-006: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 RECOMMENDATION The auditor recommends the Project and management review and attend training on the HUD Handbook 4350.3 Revision 1 requirements for tenant files including eligibility and income calculations. In addition, the auditor recommends the Project obtain necessary recertification signatures timely. ACTION TAKEN Carrasquillo Management LLC acknowledges the findings and is taking the following corrective actions to ensure compliance with HUD Handbook 4350.3 requirements: 1. Enterprise Income Verification (EIV) Reports Management has implemented an internal checklist to ensure that the initial EIV reports are generated within the required 90 days for all move-ins. Staff has been retrained on EIV protocols and timelines to ensure timely compliance going forward. 2. Timely Tenant Signatures on Recertifications A new recertification specialist has been hired, who is fully trained and qualified in HUD income certifications. Carrasquillo Management LLC has implemented a new tracking system and notification schedule to ensure that all recertification documents are signed by tenants on or before the effective date. Management is also increasing tenant engagement through reminder letters and calls. 3. Bank Account Balance Calculations Staff has received additional training on income and asset calculations per HUD guidance. A verification template has been implemented to ensure all checking account balances are calculated using the six-month average, as required. 4. Security Deposit Charges The error identified regarding the incorrect security deposit has been corrected. Going forward, all move-ins will include a verification step to ensure that the correct deposit is charged in accordance with lease and program guidelines. 5. Date and Time-Stamped Applications Management has implemented a new policy requiring staff to date-and time-stamp all tenant applications upon receipt. Staff has been trained accordingly and periodic file reviews will be conducted to ensure compliance. 6. Missing Lease and Application Documents Management has begun a full file audit to identify and correct any remaining deficiencies. Procedures have been updated to ensure original leases and completed applications are filed immediately upon move-in and scanned into the electronic system as a backup. 7. Move -Inspections A revised move-in protocol has been established that includes a checklist confirming inspection completion and file documentation. A copy of the move-in inspection form is now required to be signed by both tenant and management and scanned into the file on the same day of move-in. 8. Training and Oversight Carrasquillo Management LLC will continue to provide regular staff training and compliance reviews to ensure that all HUD file requirements are met. In addition, quarterly internal audits will be conducted to verify proper documentation and adherence to timelines. We are committed to maintaining full compliance with HUD regulations and ensuring tenant file accuracy moving forward.

View Audit 361007

Finding 569621 (2024-005)

None 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Cash Management Eligibility

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-005: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 REC...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-005: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 RECOMMENDATION The auditor recommends ensuring all tenant’s 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 Carrasquillo Management LLC acknowledges the audit finding related to rent miscalculations for five tenant files during the fiscal year ended September 30, 2024. These errors resulted in both minor tenant overcharges and undercharges, as well as corresponding discrepancies in HUD’s rental assistance payments. 1. Financial Corrections ○ The Project will reimburse the two affected tenants a total of $14 to correct the overcharges. ○ The Project will submit a request to HUD to repay the $14 in overpaid rental assistance associated with these tenants. ○ For the three tenants who were undercharged a total of $826, the Project will bill the tenants for the rent differential in accordance with HUD regulations and provide HUD with reimbursement of the $826 in excess rental assistance paid. 2. File Review and Quality Control Measures Management has implemented a secondary file review process for all certifications and recertifications to ensure that income is correctly verified, entered, and calculated in accordance with HUD Handbook 4350.3 requirements. All tenant income documentation will be double-checked by the compliance team prior to finalizing certifications. 3. Staff Training All staff involved in income verification and rent calculation have been retrained on HUD rent calculation guidelines, including handling of paystubs, Social Security statements, and other income documentation. Training includes real-case scenarios and common error prevention techniques. 4. Compliance Oversight Moving forward, Carrasquillo Management LLC will conduct quarterly internal audits of a random sample of tenant files to verify the accuracy of income calculations and ensure compliance with HUD regulations. Carrasquillo Management LLC remains committed to ensuring the accuracy of tenant rent determinations and maintaining compliance with HUD’s income calculation requirements. All necessary reimbursements and corrective actions will be completed promptly and documented for HUD’s records.

View Audit 361007

Finding 569620 (2024-004)

None 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Subrecipient Monitoring Reporting

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-004: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 REC...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-004: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 RECOMMENDATION The auditor recommends the Property receive HUD approval before withdrawing funds from its residual receipts account and repay the $163,679 to the residual receipts account. ACTION TAKEN Carrasquillo Management LLC acknowledges the finding regarding the unauthorized withdrawal of $163,679 from the Project’s residual receipts account during the fiscal year ended September 30, 2024. This withdrawal was related to surplus cash from fiscal year 2023 that had been deposited into the residual receipts account. Due to miscommunication and misunderstanding during the transition between management companies, the withdrawal was made without obtaining prior written approval from HUD, as required under HUD Handbook 4370.2 Revision 1. Corrective Actions: 1. Repayment Agreement with HUD Carrasquillo Management LLC has been in direct communication with the Project’s HUD Account Executive, Nyal McDonough, of the Northeast Region Asset Management Division. HUD has agreed to allow the Project to repay the full $163,679 through monthly installments as part of an interest-free repayment plan until the balance is fully restored to the residual receipts account. This agreement is currently being implemented and tracked in coordination with HUD. 2. Internal Compliance Controls To ensure full compliance going forward, Carrasquillo Management LLC has updated internal policies and procedures to strictly prohibit any withdrawals from the residual receipts account without explicit written authorization from HUD. All future requests for residual receipts will be submitted through HUD’s formal request channels, and no funds will be accessed without prior written approval. 3. Staff Training Relevant personnel have received training on HUD Handbook 4370.2 and HUD financial controls regarding restricted accounts. Additional safeguards are in place to ensure management and accounting teams confirm HUD approval documentation before any restricted account disbursement. 4. Monthly Monitoring and Reporting Carrasquillo Management LLC will include the residual receipts repayment schedule in its monthly financial reporting to ownership and will maintain communication with HUD to ensure full transparency throughout the repayment period. Carrasquillo Management LLC is committed to full regulatory compliance and to restoring the integrity of all project accounts in collaboration with HUD.

View Audit 361007

Finding 569619 (2024-003)

None 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Cash Management Internal Control / Segregation of Duties

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-003: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 REC...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-003: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 RECOMMENDATION The auditor recommends management review the HUD Handbook on determining eligible income included in the management fee calculation. ACTION TAKEN Carrasquillo Management LLC acknowledges the auditor’s finding regarding the overcharged management fee of $13,884 for the fiscal year ended September 30, 2024. The overcharge occurred during the management transition in March 2024. The outgoing management company, Mount Holyoke Management LLC, issued and received a management fee payment for the full month of March despite their services ending early in the month. Carrasquillo Management LLC officially took over management of the Project on March 9, 2024, and also received the management fee for services rendered during the remainder of that month. This resulted in both management companies receiving compensation for the same period, causing the annual management fee to exceed HUD’s allowable limits. Corrective Actions: 1. Fee Review and Adjustment Carrasquillo Management LLC is working with the auditor and ownership to correct the management fee overcharge in the Project’s financial records. Any necessary adjustments or reimbursements will be made to bring the project into compliance. 2. HUD Handbook Compliance Training Management has reviewed the relevant guidance in HUD Handbook 4381.5 Revision 2 and is ensuring that all future management fee calculations strictly follow HUD’s criteria for eligible income and fee limits. 3. Transition Protocols To prevent this issue from recurring during future management transitions, Carrasquillo Management LLC has developed a formal transition protocol that includes a reconciliation of income and fees and written confirmation of responsibilities to avoid any overlapping charges. 4. Oversight and Internal Controls All future management fee calculations will be reviewed and approved by the Regional Manager and Accounting Department to verify accuracy and compliance with HUD guidelines prior to disbursement. Carrasquillo Management LLC remains committed to ensuring proper financial stewardship of HUD program funds and maintaining compliance with all applicable regulations.

View Audit 361007

Finding 569618 (2024-002)

None 2024

Spring Meadow Association of Responsible Tenants, Inc. 023-44087

MA

HUD Housing Programs Subrecipient Monitoring

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-002: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 REC...

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-002: Major Programs: Capital Advance Program, Federal Assistance Listing Number 14.U01 and Section 8 New Construction and Substantial Rehabilitation, Federal Assistance Listing Number 14.182 RECOMMENDATION The auditor recommends moving some of the Project’s funds to other banks to ensure all bank account balances at each bank remain below the FDIC limit. ACTION TAKEN Carrasquillo Management LLC acknowledges the finding regarding the Project’s bank balances exceeding the Federal Deposit Insurance Corporation (FDIC) insured limit of $250,000. Carrasquillo Management LLC assumed management of the Project on March 9, 2024. At the time of transition, all existing bank accounts were already established with Westfield Bank. Management has since reviewed the account structure and balances to assess compliance with FDIC coverage requirements. Corrective Actions: 1. Risk Mitigation Plan Carrasquillo Management LLC is in the process of restructuring the Project’s banking arrangements to ensure that no single institution holds more than the FDIC-insured limit of $250,000 per ownership category. 2. Diversification of Funds The Project will open additional accounts with other FDIC-insured financial institutions and transfer excess funds accordingly. This will help safeguard assets and reduce exposure in the unlikely event of bank failure. 3. Ongoing Monitoring Management has implemented a monthly monitoring protocol to review account balances and ensure ongoing compliance with FDIC limits. This process includes scheduled reviews by the finance team to confirm that no account exceeds the insured threshold. 4. Policy Update Internal financial policies are being updated to include FDIC compliance requirements, ensuring that any future account openings or large fund deposits are properly reviewed and managed. Carrasquillo Management LLC is committed to protecting the financial assets of the Project and ensuring full compliance with HUD requirements and FDIC insurance guidelines.

View Audit 361007

Finding 569598 (2024-006)

Material Weakness 2024

Wayne Metropolitan Community Action Agency and Affiliates

MI

Questioned Costs Special Tests & Provisions HUD Housing Programs

2024-006: Special Tests and Provisions - Reasonable Rental Rates A compliance analyst has been hired to review client files and ensure that appropriate documentation is present in client files to meet funder needs and support federal expenditures.

View Audit 360986 Questioned Costs: $1

Finding 569477 (2024-005)

None 2024

North East Community Action Corporation and Subsidiaries

MO

HUD Housing Programs

2024-005 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers Condition and Criteria: The Agency must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality ...

2024-005 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers Condition and Criteria: The Agency must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS). The Agency did not perform inspections for one unit in our sample. Cause: Procedures are in place for performing inspections, but due to inspector turnover, the inspections were not performed during the fiscal year. Effect: There is a possibility that sanctions could be imposed if they do not perform inspections as required by the program. Context: The Agency is aware of the requirement and has promoted an Inspector to oversee the processes and ensure the Agency is complying with the requirements. CORRECTIVE ACTION PLAN RESPONSE: As stated above, we have promoted someone to a supervisory position to oversee the inspectors and their processes. Also, the housing counselors have been asked to check and make sure an inspection has been done in the previous 24 months before finalizing their annual certifications, to help ensure none are overlooked. Anticipated completion date: 9/30/25 Responsible party: Michelle Worthington, Section 8 Housing Director Please contact Vicky Pritchett, Finance Director at 573-213-4811 extension #10102 with questions regarding this plan.

View Audit 360960

Finding 569476 (2024-004)

Material Weakness 2024

North East Community Action Corporation and Subsidiaries

MO

Questioned Costs HUD Housing Programs Subrecipient Monitoring

2024-004 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers - Material Weakness Condition and Criteria: An assistance payment was calculated incorrectly due to errors in data entry. Eligibility for the p...

2024-004 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers - Material Weakness Condition and Criteria: An assistance payment was calculated incorrectly due to errors in data entry. Eligibility for the program requires payment based on substantiated income and expense of the applicants. Cause: Human error in the calculation of income allowance which affected the assistance payment. Effect: The cost of the assistance may be disallowed. Context: A sample of grants totaling $33,038 was selected for audit from a population of $6,470,217. The test found questioned costs totaling $36. Our sample was a statistically valid sample. CORRECTIVE ACTION PLAN RESPONSE: Housing counselors are instructed to document their math on the proof of income they are figuring, and double check their figures. A spreadsheet has also been created so that they can choose how often a client is paid and enter the amounts of pay and it figures the totals for them. If they use the spreadsheet, they are asked to print it out and scan it in with the transaction documents. Anticipated completion date: 9/30/25 Responsible party: Michelle Worthington, Section 8 Housing Director Please contact Vicky Pritchett, Finance Director at 573-213-4811 extension #10102 with questions regarding this plan.

View Audit 360960 Questioned Costs: $1

Finding 569475 (2024-003)

Material Weakness 2024

North East Community Action Corporation and Subsidiaries

MO

Questioned Costs HUD Housing Programs Material Weakness

2024-003 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers Condition and Criteria: The Agency is to retain supporting documentation for individuals served by the program to support assistance payments m...

2024-003 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers Condition and Criteria: The Agency is to retain supporting documentation for individuals served by the program to support assistance payments made to these individuals. The Agency was unable to retrieve some of their scanned documentation for part of the year audited (four tenants in the sample). Cause: The Agency relies solely on an outside vendor to back-up their data. The Agency switched vendors for part of the year audited and upon terminating the agreement with that vendor, some scanned documentation was lost and is irretrievable. The Agency did not maintain paper files. Effect: There is a possibility rental assistance payments could be considered disallowed expenditures due to lack of supporting documentation identified. Context: The Agency identified the issue and recreated lost documentation to the best of their ability. A sample of grants totaling $33,038 was selected for audit from a population of $6,470,217. The test found questioned costs totaling $1,962. Our sample was a statistically valid sample. CORRECTIVE ACTION PLAN RESPONSE: The agency recreated what we could and uploaded to the current housing software. Housing counselors are instructed to keep the paper versions of household transactions for two years and verify that the electronic copy is clear before shredding. Anticipated completion date: 9/30/25 Responsible party: Michelle Worthington, Section 8 Housing Director Please contact Vicky Pritchett, Finance Director at 573-213-4811 extension #10102 with questions regarding this plan.

View Audit 360960 Questioned Costs: $1

Finding 569474 (2024-002)

Material Weakness 2024

North East Community Action Corporation and Subsidiaries

MO

Questioned Costs HUD Housing Programs Material Weakness

2024-002 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers - Material Weakness Condition and Criteria: The Agency is to retain supporting documentation for individuals served by the program to support a...

2024-002 U.S. Department of Housing and Urban Development Housing Voucher Cluster - 14.871 Section 8 Housing Choice Vouchers and 14.879 Mainstream Vouchers - Material Weakness Condition and Criteria: The Agency is to retain supporting documentation for individuals served by the program to support assistance payments made to these individuals. The Agency was unable to retrieve some of their scanned documentation for part of the year audited (four tenants in the sample). Cause: The Agency relies solely on an outside vendor to back-up their data. The Agency switched vendors for part of the year audited and upon terminating the agreement with that vendor, some scanned documentation was lost and is irretrievable. The Agency did not maintain paper files. Effect: There is a possibility rental assistance payments could be considered disallowed expenditures due to lack of supporting documentation identified. Context: The Agency identified the issue and recreated lost documentation to the best of their ability. A sample of grants totaling $33,038 was selected for audit from a population of $6,470,217. The test found questioned costs totaling $1,962. Our sample was a statistically valid sample. CORRECTIVE ACTION PLAN RESPONSE: The agency recreated what we could and uploaded to the current housing software. Housing counselors are instructed to keep the paper versions of household transactions for two years and verify that the electronic copy is clear before shredding. Anticipated completion date: 9/30/25 Responsible party: Michelle Worthington, Section 8 Housing Director Please contact Vicky Pritchett, Finance Director at 573-213-4811 extension #10102 with questions regarding this plan.

View Audit 360960 Questioned Costs: $1

Finding 569473 (2024-003)

Material Weakness 2024

Rock Island Housing Authority

IL

Eligibility HUD Housing Programs

We have implemented a plan for proper training to make sure everyone is aware of HUD rules regarding family eligibility. We will complete a quarterly audit of randomly selected files to ensure we are adhering to HUD rules. We will ensure staff monitors eligibility for each resident within the requ...

We have implemented a plan for proper training to make sure everyone is aware of HUD rules regarding family eligibility. We will complete a quarterly audit of randomly selected files to ensure we are adhering to HUD rules. We will ensure staff monitors eligibility for each resident within the required time frame.

View Audit 360951

Finding 569472 (2024-002)

Material Weakness 2024

Rock Island Housing Authority

IL

HUD Housing Programs Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking

In order to keep cash as accurate as possible, we will clear interfunds monthly. In order to prevent co-mingling of cash, we will begin a plan to break apart the funds for each program – Spencer, COCC, 3rd and 11th. We also adjusted allocations to better reflect employees’ use of time and actual c...

In order to keep cash as accurate as possible, we will clear interfunds monthly. In order to prevent co-mingling of cash, we will begin a plan to break apart the funds for each program – Spencer, COCC, 3rd and 11th. We also adjusted allocations to better reflect employees’ use of time and actual costs incurred by program and by LITC property. Public Housing and COCC training is planned that all finance staff will attend to make sure proper HUD procedures, rules, and guidelines are followed. By June 2025, we have already reduced the receivable by 200,000. The plan is to reduce the receivable down to $0 in 3-5 years.

View Audit 360951

Finding 569454 (2024-001)

None 2024

McKee Manor Apartments, Inc.

KY

HUD Housing Programs Matching / Level of Effort / Earmarking

Corrective Action Plan June 27, 2025 McKee Manor Apartments, Inc. respectfully submits the following corrective action plan for the year ended September 30, 2024. Hicks & Associates CPAs 1795 Alysheba Way, Ste 6206 Lexington, KY 40509 Audit Period: Year Ended September 30, 2024 The finding fr...

Corrective Action Plan June 27, 2025 McKee Manor Apartments, Inc. respectfully submits the following corrective action plan for the year ended September 30, 2024. Hicks & Associates CPAs 1795 Alysheba Way, Ste 6206 Lexington, KY 40509 Audit Period: Year Ended September 30, 2024 The finding from the September 30, 2024 Schedule of Findings and Questioned Costs is discussed below: FINDING – MAJOR FEDERAL AWARD PROGRAM 2024-001 Replacement Reserve Loans Payback Recommendation: We recommend that the Project adhere to the payback terms of the HUD approved loans from the Replacement Reserve or negotiate different terms with HUD and obtain approval from HUD. Action Taken: Management acknowledges the finding, and the Project is working with X-Caliber Capital to get the repayment payments current and will be working on paying extra to get the repayments paid off sooner. If you have any questions regarding this plan, please call Jean Peyton at (859)255-3334. Sincerely, Jean Peyton ______________________________________ Jean Peyton, Regional Property Manager Kirkpatrick Management Company

View Audit 360940

Finding 569423 (2024-025)

Material Weakness 2024

District of Columbia Housing Authority

MD

HUD Housing Programs Special Tests & Provisions Material Weakness

Finding: 2024-025 U.S. Department of Housing and Urban Development AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance/ Material Noncompliance for Special Tests and Provisions – Rent Reasonableness Repeat Finding: Yes 2023-007 Auditee’s Corrective Actio...

Finding: 2024-025 U.S. Department of Housing and Urban Development AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance/ Material Noncompliance for Special Tests and Provisions – Rent Reasonableness Repeat Finding: Yes 2023-007 Auditee’s Corrective Action Plan: DCHA has implemented controls to ensure rent to the owner is reasonable and in accordance to our admin plan. All rent reasonableness files are housed in the rent reasonableness software- AffordableHousing.com. DCHA has a policy in place for rent reasonableness, and all rent reasonable comparability studies are housed in the software system. Contact Person:Anton Shaw, Director, Housing Choice Voucher Program Completion Date: September 30, 2026

View Audit 360910

Finding 569422 (2024-024)

Material Weakness 2024

District of Columbia Housing Authority

MD

HUD Housing Programs Special Tests & Provisions Material Weakness

Finding 2024-024 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Special Tests and Provisions - HQS Repeat Finding: Yes; 2023-005 Auditee’s Corrective Action Plan: DCHA reviewed the eight te...

Finding 2024-024 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Special Tests and Provisions - HQS Repeat Finding: Yes; 2023-005 Auditee’s Corrective Action Plan: DCHA reviewed the eight tested, and they will be completed in accordance to the DCHA Admin plan which will be completed in FY 2025. Contact Person: Anton Shaw, Director, Housing Choice Voucher Program Completion Date: September 30, 2025

View Audit 360910

Finding 569421 (2024-023)

Material Weakness 2024

District of Columbia Housing Authority

MD

HUD Housing Programs Special Tests & Provisions Material Weakness

Finding 2024-023 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Special Tests and Provisions – HQS Enforcement Repeat Finding: Yes; 2023-004 Auditee’s Corrective Action Plan: The HCVP Inspe...

Finding 2024-023 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Special Tests and Provisions – HQS Enforcement Repeat Finding: Yes; 2023-004 Auditee’s Corrective Action Plan: The HCVP Inspections department has begun a department reorganization which includes updating Standard Operating Procedures (SOPs), enhancement to the Yardi inspections module, and training. The reorganization will allow oversight of DCHA inspection team and contracted inspection staff that was brought on to assist the backlog of annual inspections. Quality control measures have also been put into place to monitor the Yardi system of timely inspections, reinspections, and/or abatements. Contact Person: Anton Shaw, Director, Housing Choice Voucher Program Completion Date: September 30, 2026

View Audit 360910

Finding 569420 (2024-022)

Material Weakness 2024

District of Columbia Housing Authority

MD

HUD Housing Programs Eligibility Material Weakness

Finding 2024-022 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Eligibility Repeat Finding: Yes; 2023-003 Auditee’s Corrective Action Plan: DCHA has increased their quality control departme...

Finding 2024-022 U.S. Department of Housing and Urban Development (HUD) AL No. 14.871/14.879 Housing Voucher Cluster Material Weakness in Internal Control over Compliance for Eligibility Repeat Finding: Yes; 2023-003 Auditee’s Corrective Action Plan: DCHA has increased their quality control department to ensure that file reviews are completed and stored electronically in the Yardi system. In addition, DCHA has engaged with several consulting groups to assist in the backlog of recertifications while the current staff works on the current recertifications so they do not become past due like in the past. Third party vendors have been brought onboard to assist with processing all past due biennial recertifications. Contact Person: Anton Shaw, Director, Housing Choice Voucher Program Completion Date: September 30, 2026

View Audit 360910

Finding 569417 (2024-021)

Material Weakness 2024

District of Columbia Housing Authority

MD

Eligibility HUD Housing Programs Material Weakness

Finding 2024-021 U.S. Department of Housing and Urban Development (HUD) AL No. 14.881 Moving to Work Demonstration Material Weakness in Internal Control over Compliance for Eligibility Repeat Finding: Yes; 2023-002 Auditee’s Corrective Action Plan: DCHA has increased their quality control department...

Finding 2024-021 U.S. Department of Housing and Urban Development (HUD) AL No. 14.881 Moving to Work Demonstration Material Weakness in Internal Control over Compliance for Eligibility Repeat Finding: Yes; 2023-002 Auditee’s Corrective Action Plan: DCHA has increased their quality control department to ensure that file reviews are completed and stored electronically in the Yardi system. In addition, DCHA has engaged with several consulting groups to assist in the backlog of recertifications while the current staff works on the current recertifications so they do not become past due like in the past. Contact Person: Anton Shaw, Director, Housing Choice Voucher Program Completion Date: September 30, 2026

View Audit 360910

Finding 569415 (2024-003)

Material Weakness 2024

First Financial Credit Union

NM

Allowable Costs / Cost Principles HUD Housing Programs Material Weakness

3. Finding 2024-003 Section 5.1 of the grant agreement incorporates 2 CFR Part 200, which establishes uniform administrative requirements, cost principles, and audit requirements for Federal awards, Uniform Guidance (UG) Administrative Requirements. UG administrative requirements puts emphasis on wr...

3. Finding 2024-003 Section 5.1 of the grant agreement incorporates 2 CFR Part 200, which establishes uniform administrative requirements, cost principles, and audit requirements for Federal awards, Uniform Guidance (UG) Administrative Requirements. UG administrative requirements puts emphasis on written policies and procedures as central in its objective to maintain effective internal controls over federal awards. a. Action(s) Taken or Planned on the Finding Management has is in the process of developing policies and procedures to comply with the grant agreement and 2 CFR 200. b. Implementation Date: Estimated completion date is August 31, 2025.

View Audit 360908

Finding 569391 (2024-003)

Significant Deficiency 2024

Woodbend Housing Corporation

OH

Questioned Costs HUD Housing Programs Reporting

Management acknowledges the auditor’s observation and deposit will be made.

View Audit 360895 Questioned Costs: $1

Finding 569390 (2024-002)

Significant Deficiency 2024

Woodbend Housing Corporation

OH

Questioned Costs HUD Housing Programs Allowable Costs / Cost Principles

Management is currently conducting a comprehensive review of the process to ensure alignment with compliance requirements and identify areas for improvement.

View Audit 360895 Questioned Costs: $1

Finding 569389 (2024-001)

Significant Deficiency 2024

Woodbend Housing Corporation

OH

Questioned Costs HUD Housing Programs Reporting

Management is currently conducting a comprehensive review of the process to ensure alignment with compliance requirements and identify areas for improvement.

View Audit 360895 Questioned Costs: $1

Corrective Action Plans

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