FAC Explorer

Finding 1168919 (2025-001)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2025
Accepted
2026-01-13
Audit: 381382
Organization: Villa Caridad 122-Ee183-Wah-Np (CA)
Auditor: COHNREZNICK LLP

AI Summary

  • Core Issue: Tenant lease files are not being maintained properly, leading to a lack of timely income verification for new tenants.
  • Impacted Requirements: Compliance with HUD Handbook 4350.3 is not consistently met, risking eligibility errors for tenants and incorrect rent subsidies.
  • Recommended Follow-up: Management should implement and monitor new procedures to ensure accurate tenant eligibility determinations and proper lease file maintenance.

Finding Text

Name of Federal Agency: Department of Housing and Urban Development Federal Program Name: Supportive Housing for the Elderly (Section 202) Assistance Listing Number: 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Program. Condition In connection with out lease file review, we noted the following deficiency: * 1 out of 1 new tenant tested did not have an EIV-system income verification performed in a timely fashion Cause Management's policies with respect to the determination of tenant eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance code: Section 202 program administration Finding Resolution Status: In process Views of Responsible Officials The management company acknowledges the importance of EIV documentation and the timeliness required for generating reports for documentation and review within specified deadlines. To ensure ongoing compliance with these regulations, management will continue the training protocol that is in place annually and will periodically review files to ensure procedures are properly followed going forward.

Corrective Action Plan

The management compnay acknowledges the important regulatory requirements for EIV documentation and timeliness required for generating reports for documentation and review within specified deadlines. To ensure ongoing compliance with these regulations, management will continue the training protocol that is in place for 2025 by reviewing and signing the EIV rules of Behavior and the EIV System Security Policy forms and completing the Cyber Awareness training annually. Management is working with on-site managers to provide additional back-up support from other departments during staffing shortages. Management also strengthened oversight procedures to ensure there are mandatory manager protocols that require an EIV report be generated and reviewed within 90 days for every new tenant move-in. For example, management implemented a checklist that the property manager must sign to confirm the EIV and other documents are properly reviewed and included in tenant files. For new tenants, the property manager will calendar the 90-day review to confirm receipt of EIV for inclusion in the tenant file. Management's housing manager and broker will also review each tenant file checklist for compliance to verify that all required EIV and other reports are in the tenant file. Additionally, management will conduct periodic reviews of files to ensure these procedures are properly followed. These additional checks and balances will ensure we are compliant with regulatory requirements.

Categories

Eligibility HUD Housing Programs

Other Findings in this Audit

  • 1168918 2025-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 SUPPORTIVE HOUSING FOR THE ELDERLY $565,635