Finding 1155205 (2024-001)

Material Weakness Repeat Finding
Requirement
Eligibility
Questioned Costs
$1
Year
2024
Accepted
2025-09-25

AI Summary

  • Core Issue: The Housing Authority of the City of Pittsburgh has repeated failures in timely tenant recertifications and documentation, indicating weak internal controls.
  • Impacted Requirements: Compliance with HUD requirements for timely and accurate completion of Form HUD-50058, which is crucial for determining tenant eligibility and rental assistance.
  • Recommended Follow-Up: Implement stronger procedures for timely recertifications, ensure all necessary documentation is collected, and provide training to mitigate future staffing challenges.

Finding Text

Finding 2024-001 U.S. Department of Housing and Urban Development Moving to Work Demonstration Program - ALN 14.881 Eligibility and Reporting Repeat Finding from 2021 (2021-001), 2022 (2022-001), and 2023 (2023-001) Condition: During our review of 40 tenant files prepared by the Housing Authority of the City of Pittsburgh (Authority) as part of the biennial reexamination process, we noted a lack of functioning internal controls which led to the below exceptions in our testing. We noted four instances where a tenant recertification using the Form HUD-50058, Family Report (Form) (which provides eligibility and reporting information) was not completed on a timely basis. We also noted one instance where other documentation to support the reporting and eligibility assessment as part of completion of the HUD-50058 was not provided. This includes items such as support for income calculation and medical deductions. These exceptions indicate a lack of functioning internal controls and oversight to ensure compliance with HUD requirements related to timely and accurate tenant recertifications. Criteria: The Authority is required to prepare and submit the Form each time the Authority completes an admission, bi-annual reexamination, portability move-in, or other change of unit for a family. The form provides HUD and the Authority with vital eligibility data for each program participant such as family composition, family income, the assets and liabilities of program participants, and ultimately provides for the calculation of tenant rent and rental/housing assistance payments for each program participant. In relation to the missing documents noted above, these documents are to be maintained to support the eligibility of the tenant, and are also required to be maintained to provide support for the tenant income and eligibility determinations completed on the Form. Cause: There was a lack of functioning internal control over the recertification process that were exacerbated by turnover and logistical staffing challenges in recent years. Effect: The Form provides essential information to HUD as well as being used by the Authority to determine program eligibility. In addition, the Form is used for the calculation of tenant rent and rental/housing assistance payments. Without this required documentation, this could lead to ineligible tenants being housed through the Authority program, and/or overpayments or underpayments of rental assistance, and incorrect information being reported to HUD. Questioned Costs: Unknown Recommendation: We recommend that the Authority implement additional procedures to ensure biennial recertification and the related Forms are prepared timely and accurately and that all supporting documentation is obtained and retained. In addition, appropriate training and planning should be performed to ensure that future turnover in the organization does not lead to a lapse in internal controls over compliance. Views of responsible officials and planned corrective action: Management agrees with the finding. See separate corrective action plan.

Corrective Action Plan

The findings from the December 31, 2024, Schedule of Findings and Questioned Costs are discussed below. The findings are numbered consistently with the number assigned in the schedule. Finding 2024-001 U.S. Department of Housing and Urban Development Moving to Work Demonstration Program - ALN 14.881 Eligibility and Reporting Repeat Finding from 2021(2021-001), 2022(2022-001), and 2023 (2023-001) Maher Duessel Finding Condition: During our review of 40 tenant files prepared by the Housing Authority of the City of Pittsburgh (Authority) as part of the biennial reexamination process, we noted a lack of functioning internal controls which led to the below exceptions in our testing. We noted four instances where a tenant recertification using the HUD-50058, Family Report (Form) (which provides eligibility and reporting information) was not completed, on a timely basis. We also noted one instance where other documentation to support the reporting and eligibility assessment as part of completion of the HUD-50058 was not provided. This includes items such as support for income calculation and medical deductions. These exceptions indicate a lack of functioning internal controls and oversight to ensure compliance with HUD requirements related to timely and accurate tenant recertifications. HACP Management Response/Action Taken: Action Taken: The HACP will continue to monitor and train staff regarding processes and procedures, to include and not limited to the Housing and Urban Development's (HUD) hierarchy of income verification. As noted in previous responses, the HACP continues to experience challenges in hiring and retaining staff as a result of the complexity of the Housing Choice Voucher (HCV) Program. In fiscal year (FY) 2024, the HCV Department had a significant turnover in both line and managerial staff. The HACP promoted an aggressive hiring plan to attract new talent to fill vacant positions due to the great resignation that the HACP, along with other national Agencies, continue to experience. In addition, the HACP has adopted the policy of hiring more staff than needed in the event of turnover. The HACP will continue to utilize the Internal Compliance (IC) Department to review recertifications and compile audit report cards based on the accuracy of recertifications reviewed. The audit report cards are used as an additional management tool to determine whether additional training is needed for staff and the department in general. The HACP continues to: • Send notices regarding re-certifications 120 days in advance of the due date, o Send 10-day notices for missing AR documents o Send 30-day notices when there is no or insufficient response to the 10 day notice sent • Require Managers to review reports to assure timely submission of re-certifications, • Utilize the IC Department to review and sample files from the Occupancy and the HCV portfolio, • Offer periodic staff training on re-certification, • Offer participants the use of technology to complete paperwork In addition to the above noted internal controls, the HACP will institute Bob.ai in FY 2026 as an additional tool to notify both the participant and the HACP staff when the recertifications are due and provide notification of missing documents. The One Stop Shop (OSS) is staffed with three (3) full-time staff members to receive information from participants and landlords to provide timely customer service. In July of 2024, the OSS was equipped with computers for the public to access HACP staff virtually. The use of the computers allows staff to interact with participants regarding minor issues without having the staff physically come to the OSS, thus saving time and money for both the external customer and the Authority. The opening of the One Stop Shop has been successful in receiving the public and responding to concerns.

Categories

Questioned Costs Eligibility HUD Housing Programs Internal Control / Segregation of Duties Reporting

Programs in Audit

ALN Program Name Expenditures
14.881 Moving to Work Demonstration Program $149.31M
14.871 Section 8 Housing Choice Vouchers $1.51M
14.870 Resident Opportunity and Supportive Services - Service Coordinators $377,268
14.856 Lower Income Housing Assistance Program Section 8 Moderate Rehabilitation $289,360
14.879 Mainstream Vouchers $135,108
14.896 Family Self-Sufficiency Program $109,931