Finding 1174189 (2025-004)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2025
Accepted
2026-02-18

AI Summary

  • Core Issue: The City failed to conduct required biennial inspections of housing units, risking health and safety for participants.
  • Impacted Requirements: Non-compliance with 24 CFR sections 982.158(d) and 982.405(b) regarding housing quality standards.
  • Recommended Follow-Up: Management should establish controls to ensure timely inspections and proper documentation of unit inspection reports.

Finding Text

Finding: 2025‐004 U.S. Department of Housing & Urban Development Program Name: Section 8 Housing Voucher Cluster AL Number: 14.871 Material Non‐Compliance Material Weakness Special Tests and Provisions Criteria: In accordance with 24 CFR sections 982.158(d) and 982.405(b), the Public Housing Agencies (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. Condition: The City did not follow procedures to ensure compliance of housing quality standards inspections. Context: Of the 1,764 applicants during the current year valued at $903,155, we examined 60 and determined that 4 (7% valued at $1,933) did not have a unit inspection report to verify that the unit was inspected. Effect: Units leased to a family could not meet the housing quality standards necessary for the health and safety of program participants. Cause: Lack of proper internal control over housing quality standards inspections. Identification of a Repeat Finding: This is modified and a repeat Finding of 2024-003 from the immediate previous audit. Questioned Cost: The finding represented an internal control weakness; therefore, no questioned costs are applicable. Recommendation: Management should implement controls to ensure that housing quality standards inspections are completed at lease biennially and documented on a unit inspection report. Views of Responsible Officials and Planned Corrective Actions: The City agrees with this finding. Please refer to the Corrective Action Plan section of this report.

Corrective Action Plan

Finding: 2025-004 Name of Contact Person: Renae Miller, Public Housing Director Corrective Action/Management’s Response: The Housing Choice Voucher (HCV) Program repeat findings identified in the audit are acknowledged. As part of the corrective action to address these findings and to strengthen program compliance and oversight, the City of Albemarle entered into a Memorandum of Agreement (MOA) with the Lexington Housing Authority (LHA) to administer the HCV Program on the City’s behalf. As part of this transition and corrective process, LHA conducted a comprehensive review and audit of the HCV Program covering the previous five (5) years, allowing for the identification of compliance gaps, operational deficiencies, and areas requiring corrective action. This review has informed the implementation of improved controls, processes, and reporting mechanisms. Moving forward, I, as the Director of Housing, will maintain direct and ongoing oversight of the HCV Program by working closely with LHA leadership to ensure the program is administered in full compliance with HUD regulations and applicable requirements. This oversight will include: • Receipt and review of monthly HCV performance and compliance reports • Regular briefings and status meetings with the Executive Director of the Lexington Housing Authority • Ongoing monitoring of corrective actions and compliance benchmarks • Prompt resolution of identified issues to prevent recurrence of findings These measures have been implemented to strengthen accountability, improve internal controls, and ensure sustained compliance of the HCV Program moving forward. Proposed Completion Date: Immediately and Ongoing

Categories

HUD Housing Programs Special Tests & Provisions

Other Findings in this Audit

  • 1174187 2025-002
    Material Weakness Repeat
  • 1174188 2025-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 SECTION 8 HOUSING CHOICE VOUCHERS $1.14M
66.458 CLEAN WATER STATE REVOLVING FUND $735,789
14.850 PUBLIC HOUSING OPERATING FUND $679,891
97.083 STAFFING FOR ADEQUATE FIRE AND EMERGENCY RESPONSE (SAFER) $149,565
14.872 PUBLIC HOUSING CAPITAL FUND $44,570
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $34,500