Finding Text
2024-002 – HQS Inspections Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Housing Choice Voucher Program FALN: 14.871/14.879 Federal Award Identification Number and Year: MD023, 2024 Award Period: 1/1/2024-12/31/2024 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance (Modified Opinion) Criteria or specific requirement: The PHA must inspect the unit leased to a family at least biennially to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Condition: The Commission did not follow its policies and procedures designed to ensure HQS inspections were performed timely. Questioned costs: Unknown Context: During our testing of 60 files over HQS inspections, we noted the following: • 18 of 60 units tested had an inspection that was not performed on a biennial basis as required per the Commission’s Administrative Plan. Cause: HCHC employs a third-party inspection company. Many of the issues caused by the previous inspection company did not surface until early in 2023. HCHC then attempted to work with the third-party inspection company, however, ultimately that company was not able to comply with inspection requirements and HCHC terminated its contract as of June 30, 2024. Effect: The Commission is not in compliance with HUD requirements. This could have an impact on HAP calculations. Repeat finding: Yes, 2023-002 Recommendation: We recommend the Commission review its HQS inspection policies and procedures and discuss these standards with the third-party inspection company that is utilized for these inspections to ensure all inspections are performed timely and that all necessary documentation is maintained for each inspection. Views of responsible officials: There is no disagreement with the audit finding.