Finding Text
Finding No. 2024-005 – Eligibility U.S. Department of Housing and Urban Development Federal Program Name: Section 202 Supportive Housing for the Elderly Assistance Listing Number: 14.157 Criteria: Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition: During the procedures applied to a sample of 8 tenant lease files, we noted the following instances of noncompliance with HUD regulations regarding tenant eligibility and the maintenance of lease files. 1. 2 instances where the project did not maintain the move in/ move out inspection forms in the lease files. 2. 1 instance where the project was unable to provide evidence of the 50059 for the tenant file. Cause: Management’s policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect: The procedures for maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs: None Context: Management has had some issues with accessing HUD’s systems, as well as issues with the set up of the third party vendor software used to interact with HUD’s systems. This has resulted in their inability to obtain required documentation for certain tenant lease files. Additionally, not all tenants return move in / move out forms. Identification as a Repeat Finding: No Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and fully documented, and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R – Section 8 program administration Finding Resolution Status: In process Views of Responsible Officials: Management will review the processes and procedures with site personnel to strengthen controls over the maintenance of tenant lease files.