Finding 1102053 (2024-001)

Finding 2024-001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Federal Catalog Numbers: 14.871 Noncompliance – N. Special Tests and Provisions - Housing Assistance Payment Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: The PHA must pay a monthly HAP on behalf of the family that corresponds with the amount on line 12u of the HUD-50058. This HAP amount must be reflected on the HAP contract and HAP register (24 CFR section 982.158 and 24 CFR Part 982, Subpart K). Condition: Based upon inspection of the Authority’s files and on discussion with management, the Authority made HAP disbursements to landlords in an amount that did not agree to the amount on line 12u of the HUD-50058. Context: Of a sample size of five (5) tenant files, one (1) tenant's file contained nine (9) HAP disbursements that did not agree to the amount on line 12u of the corresponding HUD-50058. Our sample size is statistically valid. Cause: There is a significant deficiency in internal controls over the compliance for the special tests and provisions type of compliance related to housing assistance payments. The Authority has not maintained and monitored a system of internal controls that reasonably assures the program is in compliance. Effect: The Section 8 Housing Choice Vouchers program is in non-compliance with the special tests and provisions compliance requirement related to the disbursement of housing assistance payments. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement.