Finding 1148901 (2024-002)

2024-002 ALN 14.850 – Public Housing Operating Fund – Eligibility Condition and Criteria: During our audit, it was determined that significant deficiencies in internal controls existed over the Authority’s Public Housing Operating Fund Program eligibility process being compliant with HUD regulatory requirements. EIV reports should be ran within 120 days of move-in for new admissions to the program. An EIV report should be ran and maintained in the tenant's file at least once annually in order to meet HUD's documentation requirements. The Authority must document in the file that tenants were offered the choice of flat rent or income-based rent. The Authority did not maintain EIV reports in the tenant files. Therefore, no evidence of the EIV report being ran exists. The Authority's internal controls failed to identify one tenant that did not have an offer of flat rent versus income-based rent documented in the file. Amount of Questioned Costs: None Context: Of the 20 tenant files tested for eligibility, evidence of the EIV report being ran within 120 days of move-in date for the one of the new admissions tested was not present. In addition, 5 tenant files did not have evidence of an EIV report being ran at least once annually. In addition, one tenant file tested did not have an offer of flat rent versus income-based rent documented in the file. Cause: The Authority did not utilize adequate internal controls under prior management over the Public Housing Operating Fund program as there is a lack of sufficient documentation. Effect: Adequate supporting documentation was not maintained in the file. Auditor’s Recommendation: We recommend the Authority implement controls to run the EIV report within 120 days of move-in for new admissions and at least once annually for all other tenants. The Authority needs to maintain these EIV reports in the tenant files. The Authority should utilize effective controls to ensure relevant documentation is maintained in the Public Housing Operating Fund program tenant files. Grantee Response: The Executive Director agrees with the finding and will follow the Auditor's recommendation.