Finding 1162846 (2025-002)

Finding 2025-002 – Low Rent Public Housing Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Low Rent Public Housing – ALN 14.850 Condition & Cause: Our review of 35 Public Housing tenant files identified noncompliance in 6 files (17.1%). Of these, 2 files (5.7%) contained errors related to the verification of adjusted annual income. Both overall and income-related error rates increased compared to the prior year. Specific findings include: 1 file missing proper income verification 1 file missing proper deduction verification 3 files missing the EIV report for reexaminations 1 file missing support for an annual unit inspection 3 files missing a quarterly EIV review for zero-income households Contributing factors include insufficient quality control review procedures, high turnover in key leadership positions, and an ongoing transition to electronic tenant file systems. Criteria: HUD regulations (24 CFR § 5 and § 960) require accurate verification of income and deductions, documented annual reexaminations, and annual unit inspections. The Agency’s Admissions and Continued Occupancy Policy (ACOP) requires quarterly EIV reviews for households reporting zero income. All relevant documentation must be maintained in tenant files. Effect: Missing or inaccurate verifications and documentation may result in incorrect rent determinations, noncompliance with HUD requirements, and potential financial exposure. These issues may also impact program integrity and increase the risk of audit or monitoring findings. Recommendation: We recommend that the Authority establish a systematic review process for tenant files to ensure accuracy. This process should incorporate comprehensive staff training in correct verification methods and include regular quality control checks to promptly identify and correct errors. Furthermore, the Authority should ensure stricter adherence to its ACOP. Questioned Costs: None Repeat Finding: Yes Was sampling statistically valid? Yes Views of responsible officials: The PHA agrees with the results of the audit and recommendations.