Finding 1156608 (2024-003)

FINDING # 2024-003 ELIGIBILITY – SIGNIFICANT DEFICIENCY - COMPLIANCE SECTION 8 HOUSING CHOICE VOUCHERS (ALN # 14.871) CONTRACT #: NOT AVAILABLE FEDERAL AGENCY: U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (CONTINUED) 1. CRITERIA- Eligibility for Individuals - Most PHAs devise their own application forms that are filled out by the PHA staff during an interview with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to obtain information from third parties; (b) a federally prescribed general release form for employment information; and (c) a privacy notice. Under some circumstances, other members of the family are required to sign these forms (24 CFR sections 5.212 and 5.230). The PHA must do the following: • As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). • For both family income examinations and reexaminations, obtain and document in the family file third party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or income- based rent (24 CFR section 982.516). 2. CONDITION/PERSPECTIVE The Authority received funding from the HUD. The Section 8 Housing Choice Voucher Program provides rental assistance to help very low- income families afford decent, safe, and sanitary rental housing. The Mainstream Voucher program enables families for whom the head, spouse, or co-head is a person with disabilities to lease affordable private housing of their choice. Of the sixty (60) case files selected for testing in which 600 pieces of audit evidence (eligibility forms as noted in the Criteria section above) were requested to be provided: • Thirty-three eligibility forms related to five cases, were not provided (Thirty-two missing application forms, and one missing third -party verification of reported family annual income form). These forms are required documentation to be maintained in the case files to support eligibility for Section 8 Housing Choice Voucher Program. Therefore, we were not able to determine if the eligible participants met all the eligibility criteria. 3. CAUSE The Authority did not ensure that all required eligibility forms were obtained from the tenants and included in the case files timely. 4. EFFECT The U.S. Department of Housing and Urban Development may consider the Authority non-compliant with the eligibility requirements. 5. REPEAT FINDING No 6. RECOMMENDATION We recommend the Authority strengthen its controls over the Section 8 Housing Choice Voucher Program case files to ensure that all eligibility forms are received, reviewed, and maintained in the case files to support the determination of eligibility. 7. QUESTIONED COST Cannot be determined. 8. VIEWS OF RESPONSIBLE OFFICIAL There are some missing documentation pertaining to eligibility and admission in files for households admitted prior to 2011. Such documentation, which includes the application, vital documents, lease, and request for tenancy approval, is aged beyond 20 years for some cases and is not retrievable as part of a 2010 backfile conversion. This was noted as a condition in a previous Single Audit. Part III of the Schedule of Findings and Questioned Costs for Federal Awards year ending December 31, 2010, cited the condition as “For two of our selections, the Authority was not able to locate the tenant file containing the required documentation that the authority had obtained to verify income eligibility. Because the tenant file was not available, the authority was not able to provide all of the documents needed to test eligibility such as tenant applications, third party income verifications, or lease agreements.” NYCHA's response to that audit conveyed our confidence in the business improvement initiatives completed to streamline the document management process. As NYCHA noted in response to the 2010 audit: the backfile conversion process was part of a large-scale, multi-year implementation of a new computer system that went live in 2011, during which over 15 million documents were converted to electronic files. New system improvements included forms tracking using the Intelligent Forms Processing (IFP) scanning technology. The IFP technology associates and saves scanned documents and documents completed by tenants electronically directly to the tenant case files in Siebel. The Siebel Customer Relationship Manager (CRM) System provides process standardization and solutions for document retention needs. In the current audit, there are 30 files that are reflective of our improved document management and retention; NYCHA has continued to make such improvements since 2011 and NYCHA remains committed to making our best efforts to ensure that all eligibility and admission documentation is maintained in the system of record.