Finding Text
Finding 2024-003 N. Special Tests and Provisions: N3. Utility Allowance Schedule Identification of the federal program: Federal Agency: U.S. Department of Housing and Urban Development (HUD) Federal Assistance Listing Number: 14.881 Federal Program Name: Moving to Work (MTW) Demonstration Program Rental Assistance Demonstration (RAD) Program Year: January 1, 2024 through December 31, 2024 Program No.: Multiple Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, “The Non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” “The PHA must maintain an up-to-date utility allowance schedule. The PHA must review utility rate data for each utility category each year and must adjust its utility allowance schedule if there has been a rate change of 10 percent or more for a utility category or fuel type since the last time the utility allowance schedule was revised (24 CFR section 982.517).” Condition: RAD – The underlying details supporting the analysis of changes in utility rate data and evidence of review over the annual utility allowance schedule were not retained. Cause: RAD – Supporting documentation for the inputs to the utility allowance schedule analysis of changes in utility rate data prepared by a third-party service provider and evidence of review over the annual utility allowance schedule by Authority management were not retained by the Authority. Effect or Potential Effect: RAD – The utility allowance schedule could be inaccurate or incomplete. Questioned Costs: None. Context: The RAD program had 5,706 tenants on its rent rolls as of December 31, 2024. Identification as a Repeat Finding, if Applicable: This finding is a partial repeat of finding 2024-004 from the prior year. Recommendation: RAD – The Authority should implement and retain supporting documentation of internal controls over the utility allowance schedule and amounts reported on line 12m or 15g of the Form HUD-50058. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.