Finding 1115117 (2024-004)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2025-03-27
Audit: 349408
Organization: City of Baldwin Park (CA)

AI Summary

  • Core Issue: The City failed to conduct timely follow-ups on Housing Quality Standards inspections, violating federal requirements.
  • Impacted Requirements: Non-compliance with 24 CFR 982.405(b) regarding inspection timelines and documentation.
  • Recommended Follow-Up: Continue using Avant Garde for inspections and enhance internal controls to ensure timely compliance.

Finding Text

2024-004 – Special Tests – Internal Control and Compliance over Housing Quality Standards Inspections (Material Weakness) Information on the Federal Program: Assistance Listing Number: 14.871 Federal Program Name: Housing Voucher Cluster Federal Agency: Department of Housing and Urban Development Pass-Through Entity: N/A Federal Award Number and Award Year: CA120 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 24 CFR 982.405(b) states that the Public PHA (PHA) must inspect the unit leased to a family prior to the initial term of the lease, at least biennially during assisted occupancy, and at other times as needed, to determine if the unit meets Housing Quality Standards (HQS). Condition: During the Fail Inspection Testing, we found five (5) instances out of nine (9) in which the City did not conduct the Housing Quality Standards (HQS) failed inspection follow-up in a timely manner. Specifically: • For two (2) samples, the reinspection was not performed within 30 days of the failed inspection, and the deficiencies were not confirmed to be resolved within the required timeframe. • For one (1) sample, the inspection checklist indicated a failed inspection, while the inspector erroneously documented and processed it as a passed inspection, meaning o reinspection was performed. • For one (1) sample, the reinspection was not performed, and no documentation was found to verify the follow-up inspection. We also noted one (1) additional instance out of forty (40) samples from Eligibility Cross Testing where the failed inspection did not have any record of a follow-up reinspection. Cause: The former Housing Inspector failed to follow the City’s policy for HQS inspections. As a result, the City identified key action items that were not being completed properly and timely by the inspector. To address these concerns, while the inspector was currently placed on leave, the City started to utilize the consulting firm Avant Garde, effective July 1, 2024, to assist with completing the required HQS inspections. Additionally, the Housing Manager and housing staff have taken on some inspection duties, while consultants continue to handle the majority of inspections until the personnel issue is resolved. Effect or Potential Effect: The City has not complied with the requirements of 24 CFR 982.405(b) – Housing Quality Standards Inspections. Questioned Costs: None. Context: See condition above for the context of the finding. Repeat Finding from Prior Year, If Applicable: Yes. See prior year finding 2023-007. Recommendation: We recommend that the City continue utilizing the consulting services provided by Avant Garde to complete the necessary HQS inspections while resolving the personnel issue. Additionally, the City should strengthen internal controls to ensure that future inspections are completed in a timely manner and in full compliance with City policies. Views of Responsible Officials: Management concurs.

Categories

Subrecipient Monitoring Eligibility HUD Housing Programs Material Weakness Internal Control / Segregation of Duties Special Tests & Provisions

Other Findings in this Audit

  • 538669 2024-001
    Significant Deficiency Repeat
  • 538670 2024-001
    Significant Deficiency Repeat
  • 538671 2024-001
    Significant Deficiency Repeat
  • 538672 2024-002
    Material Weakness Repeat
  • 538673 2024-003
    Significant Deficiency Repeat
  • 538674 2024-004
    Material Weakness Repeat
  • 538675 2024-004
    Material Weakness Repeat
  • 1115111 2024-001
    Significant Deficiency Repeat
  • 1115112 2024-001
    Significant Deficiency Repeat
  • 1115113 2024-001
    Significant Deficiency Repeat
  • 1115114 2024-002
    Material Weakness Repeat
  • 1115115 2024-003
    Significant Deficiency Repeat
  • 1115116 2024-004
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $6.24M
14.871 Section 8 Housing Choice Vouchers $506,023
14.218 Community Development Block Grant $424,092
97.067 Homeland Security Grant Program $134,965
14.850 Public and Indian Housing $44,589
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $38,289
20.600 State and Community Highway Safety $33,071
14.239 Home Investment Partnerships Program $30,748
20.205 Highway Planning and Construction $14,500