Finding 1154948 (2024-002)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
$1
Year
2024
Accepted
2025-09-24

AI Summary

  • Core Issue: The Authority made housing assistance payments without having fully executed HAP contracts for 5 out of 25 sampled cases.
  • Impacted Requirements: The PHA must keep executed leases, HAP contracts, and family applications for at least three years and cannot pay landlords without a signed HAP contract.
  • Recommended Follow-Up: Review all participant files to ensure compliance with HAP contract execution before making payments.

Finding Text

2024 -002 – SPECIAL TESTS AND PROVISIONS – HOUSING ASSISTANCE PAYMENT Material Weakness/Material Noncompliance U.S. Department of Housing and Urban Development ALN #: 14.871 – Housing Voucher Cluster CRITERIA During the term of each assisted lease, and for at least three years thereafter, the PHA must keep: (1) A copy of the executed lease; (2) The HAP contract; and (3) The application from the family. (24 CFR 982.158 (e) The PHA may not pay any housing assistance payment to the owner until the HAP contract has been executed. (24 CFR 982.305 (c)(2)). CONDITION We selected a sample of 25 participants in the Housing Choice Voucher Program. We identified 5 instances in which the HAP contract was not properly executed by either the landlord or the PHA. CAUSE Procedures were not in place to ensure that the Authority obtained fully executed copies of the HAP contracts. EFFECT The Authority made housing assistance payments to landlords when it did not have fully executed HAP contracts. QUESTIONED COSTS Known questioned costs of $69,797 represent the aggregate housing assistance payments made in these 5 instances during 2024 in which the Authority did not have fully executed HAP contracts. CONTEXT The Authority administered approximately 760 vouchers in the Housing Choice Voucher Program during 2024. We selected a sample of 25 program participants. This was not a statistically valid sample. REPEAT FINDING Not a repeat finding. RECOMMENDATION We recommend that the Authority review all program participant files to ensure that they have a fully executed HAP contract. AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION See Corrective Action Plan.

Corrective Action Plan

Finding 2024-002: HOUSING ASSISTANCE PAYMENT Description of Finding: During the term of each assisted lease, and for at least three years thereafter, the PHA must keep: (1) A copy of the executed lease; (2) The HAP contract; and (3) The application from the family. (24 CFR 982.158 (e) The PHA may not pay any housing assistance payment to the owner until the HAP contract has been executed. (24 CFR 982.305 (c)(2)) Statement of Concurrence or NonConcurrence: A sample of 25 participants in the Housing Choice Voucher Program. There were 5 identified instances in which the HAP contract was not properly executed by either the landlord or the PHA. Corrective Action: It was found that the 5 identified instances were completed by staff no longer with the authority. The five have been corrected. Staff have now been trained to perform and review of the contract during any annual or interim certification. All new moves and changes to contracts are given to the manager to ensure utility responsibilities are correctly reflected in the lease, contract, and in the software and that families are correctly credited. The HCV Director will due random review of files to ensure compliance. Name of Contact Person: Maribel Aguliar Projected Completion Date: 09/30/2025

Categories

Questioned Costs HUD Housing Programs Material Weakness Special Tests & Provisions

Other Findings in this Audit

  • 1154947 2024-001
    Material Weakness Repeat
  • 1154949 2024-003
    Material Weakness Repeat
  • 1154950 2024-004
    Material Weakness Repeat
  • 1154951 2024-005
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $9.99M
14.850 Public Housing Operating Fund $4.34M
14.872 Public Housing Capital Fund $1.12M
14.896 Family Self-Sufficiency Program $185,455
14.870 Resident Opportunity and Supportive Services - Service Coordinators $81,199