Finding Text
Department of Housing and Urban Development - Section 8 Housing Assistance Payment Program ALN # 14.195 – Section 8 Project-Based Cluster
Significant Deficiency and Material Instance of Noncompliance – Eligibility
2023-001 - Determination of Contract Rents and Maintenance of Tenant Files
Criteria: OMB Uniform Guidance Compliance Supplement for the Section 8 Housing Assistance Program requires that for all family income examinations and reexaminations, the Housing Authority must obtain and document third-party verification of (1) reported family income, (2) the value of assets, (3) expenses related to deductions, and (4) other factors that affect the determination of adjusted income or income-based rent at least once every 12 months. The program also includes other non-financial eligibility requirements, including required unit inspections on an annual basis.
Condition:
• We noted 8 files out of 40 tested did not contain sufficient income verification documentation.
• We noted rental charges for 20 tenants out of 40 tested did not match the amount per the recertification and tenant file due to the recertification not being performed within the 12 month period.
Cause: Policies and procedures with respect to the determination of eligibility and maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of the Subsidized Multifamily Housing Programs were not consistently followed.
Effect: The procedures for determining eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Tenant rental charges are determined based on 30% of their adjusted income total. Improper verification of income allows for misreporting of income and potential errors in the rent subsidies paid by HUD.
Questioned Costs: Undetermined.
Recommendation: We recommend that Housing Authority work to immediately perform proper recertifications for all tenants for which have been done incorrectly or not performed at all.
Views of Responsible Officials and Planned Corrective Action: The Housing Authority believes they have all files up to date and with sufficient supporting documentation into 2024. The Housing Authority staff also plans to take continuing education courses on the management of the RAD program.