Finding Text
HVC P Rent Reasonableness
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program Title: Housing Voucher Cluster
Assistance Listing Number: 14.871 / 14.879
Federal Award Identification Number and Year: OK002 (various funding increments active during period
1/1/23-12/31/23)
Award Period: January 1, 2023 through December 31, 2023
Type of Finding:
Significant Deficiency in Internal Control over Compliance.
Other Matters.
Criteria: The PHA must determine that the rent to owner is reasonable at the time of initial leasing.
Also, the PHA 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 five percent decrease in the published Fair Market
Rent in effect 60 days before the HAP contract anniversary.
The PHA 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).
OKLAHOMA CITY HOUSING AUTHORITY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED DECEMBER 31, 2023
(67)
Section III – Federal Award Findings and Questioned Costs (Continued)
2023 - 002 – HCVP Rent Reasonableness (Continued)
Criteria (Continued): 2 CFR 200.303 requires the Authority to establish and maintain effective internal
controls over the federal award that provides reasonable assurance that the non-federal entity is
managing the federal award in accordance with federal statutes, regulations, and the terms and
conditions of the award.
Condition: During testing, it was noted that the Authority did not have adequate internal controls
designed to ensure that rent reasonableness requirements were being met.
Questioned costs: None
Context: During the testing of 40 new tenant files, one instance was noted where the Authority
approved a contract rent higher than the amount determined to be reasonable.
Cause: The Authority does not have controls in place to ensure it is meeting reasonable rent
requirements set by HUD.
Effect: The Authority is not in compliance with program requirements over reasonable rent.
Repeat Finding: The finding is a repeat of a finding in the immediate prior year. Prior year finding
numbers were 2022-003.
Recommendation: We recommend management to enhance controls over the recertification and rent
change process to ensure determination of reasonable rent is performed prior to processing of the
move in.
View of Responsible Officials: There is no disagreement with the audit finding. The Authority made
necessary corrections and recoupment of HAP during the process of this audit.