Finding 1076550 (2023-001)

Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review, we noted the following deficiencies: The Enterprise Income Verification (EIV) form in the existing tenant's file for 5 out of 15 tenants tested did not have the EIV completed within 120 days, as required by HUD. The Enterprise Income Verification (EIV) form in the existing tenant's file for 1 out of 15 tenants tested did not have documentation in their lease file that their income was verified. The Enterprise Income Verification (EIV) form in the new tenant's file for 1 out of 2 tenants tested did not have documentation in their lease file that their income was verified. Cause Management's policies with respect to income verification and the maintenance of tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for income verification and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs None. Context Compliance procedures were not followed regarding the mandatory and timely use of Enterprise Income Verification (EIV) system during annual recertification or initial certification process. Identification as a Repeat Funding This is a repeat finding (see prior year finding number 2022-001). Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant's income is properly verified and tenant lease files are being maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R - Section 8 program administration Finding Resolution Status: In process. Views of Responsible Officials Management has implemented a monthly compliance file audit that will ensure that EIV’s are pulled and tenant income verified in a timely manner.