Finding Text
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879 Federal Award Identification Number and Year: MO002VO - 2024 Award Period: January 1, 2024 – December 31, 2024 Compliance Requirement: Special Tests and Provisions – Reasonable Rent Type of Finding: - Material Weakness in Internal Control over Compliance - Material Noncompliance (Modified Opinion) Criteria or specific requirement: The Authority must determine that the rent to owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent (initially and during the term of the Housing Assistance Payment (HAP) contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition: The Authority did not perform rent reasonableness procedures in accordance with program compliance requirements. Questioned costs: Unable to determine. Context: Exceptions noted in 5 out of 12 files tested for reasonable rent requirements. Adequate supporting documentation was not maintained. Exceptions noted in 1 out of 60 new tenants. The file was not able to be located. Cause: The Authority did not maintain documentation utilized to determine rent reasonableness. Effect: The Authority is not in compliance with rent reasonableness requirements. Repeat Finding: Yes, finding 2023-003. Recommendation: We recommend that the Authority implements controls to ensure that documentation is maintained in accordance with rent reasonableness requirements. Views of responsible officials: There is no disagreement with the audit finding.