Finding 1181378 (2025-001)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2025
Accepted
2026-03-18

AI Summary

  • Core Issue: Ten out of seventy-five tenant files showed errors in income calculations and verification, indicating a significant deficiency in compliance.
  • Impacted Requirements: Noncompliance with federal regulations and the Housing Authority’s policies on tenant file documentation and income verification.
  • Recommended Follow-Up: Enhance quality control procedures, provide additional staff training, and ensure ongoing compliance monitoring to prevent future discrepancies.

Finding Text

Finding 2025-001 – Low Rent Public Housing Tenant Files – Eligibility – Rent Calculations Noncompliance & Significant Deficiency Low Rent Public Housing – ALN 14.850 Condition & Cause: Our review of seventy-five (75) Low Rent Public Housing tenant files identified noncompliance in ten (10) files, representing 13% of the sample. We noted the following discrepancies: • Seven (7) files contained miscalculations of annual income • Two (2) files where verified deductions were not input onto the 50058 • One (1) file relied on self-declaration without documented attempts to gather the preferred verification The identified deficiencies were the result of employee errors and failure by the Agency to properly review and correct the errors. While the Agency has increased its internal quality control procedures in recent years, misunderstandings in staff roles and responsibilities during the audit period allowed the discrepancies to remain undetected. We were able to extrapolate the total potential misstatement and found it to be immaterial to the financial statements. However, due to the percentage of files not in compliance, we feel the Agency has a significant deficiency in this area. Criteria: The Code of Federal Regulations, the Housing Authority’s Admissions and Continued Occupancy Policy (ACOP), and specific HUD guidelines in documenting and maintaining Public Housing tenant files. Effect: Improper calculation and verification of adjusted annual income can lead to the incorrect calculation of rental charges and misstatements in the financial statements. Ongoing noncompliance may also draw scrutiny from regulatory bodies, increasing the risk of financial penalties or loss of funding for the Public Housing program. Recommendation: We recommend that the Agency continue to monitor and enhance its quality control procedures to ensure the accuracy and adequacy of income calculations and verifications, to assess the need for further staff training, and to effectively monitor compliance with local and federal regulations regarding the maintenance of tenant files. Questioned Costs: None Repeat Finding: No Was sampling statistically valid? Yes Views of responsible officials: The PHA agrees with the results of the audit and recommendations.

Corrective Action Plan

Corrective Action Plan for Current Year Findings and Questioned Costs for the Year Ended June 30, 2025 Reference # and title: 2025-001 Public Housing Tenant Files – Eligibility – Rent Calculations Federal Program and specific federal award identification: FEDERAL GRANTER/PASS THROUGH GRANTOR/PROGRAM NAME – United States Department of Housing and Urban Development Public and Indian Housing Program Asst. Listing Number: 14.850 Award Year: 2024 and 2025 Condition: The Code of Federal Regulations, the Housing Authority’s Admissions and Continued Occupancy Policy (ACOP), and specific HUD guidelines in documenting and maintaining Public Housing tenant files. Our review of seventy-five (75) Low Rent Public Housing tenant files identified noncompliance in ten (10) files, representing 13% of the sample. We noted the following discrepancies: Seven (7) files contained miscalculations of annual income. Two (2) files where verified deductions were not input onto the 50058. One (1) file relied on self-declaration without documented attempts to gather the preferred verification. The identified deficiencies were the result of employee errors and failure by the Agency to properly review and correct the errors. While the Agency has increased its internal quality control procedures in recent years, misunderstandings in staff roles and responsibilities during the audit period allowed the discrepancies to remain undetected. Corrective action planned: A number of the discrepancies noted by the auditor were associated with Burg Jones Plaza. To improve operations at this complex, the Housing Authority is currently working to increase operational capacity by hiring an additional Property Manager, Assistant Property Manager and Maintenance Manager. In addition to increased staff, the Housing Authority is in the process of hiring a third-party compliance vendor to conduct a thorough review of all resident files at Burg Jones Plaza to ensure compliance with regulations. This will add additional accountability to ensure the timeliness of recertifications, accuracy of rent calculations and the completion of income verifications. To further strengthen the operations of Burg Jones Plaza as well as all complexes managed and operated by Monroe Housing Authority, the Housing Authority is actively sourcing technology solutions to transition the agency to 100% online processing that will streamline administrative tasks, reduce paper-based errors and increase transparency and accountability. Person Responsible for corrective action: Ms. Shelva Thomas, Chief Deputy Director and People Officer Housing Authority of the City of Monroe 300 Harrison St. Monroe, LA 71201 Telephone: (318) 388-1500 Fax: (318) 329-1397 Anticipated Completion Date: June 30, 2026.

Categories

HUD Housing Programs

Programs in Audit

ALN Program Name Expenditures
14.850 PUBLIC HOUSING OPERATING FUND $7.22M
14.872 PUBLIC HOUSING CAPITAL FUND $3.44M
14.870 RESIDENT OPPORTUNITY AND SUPPORTIVE SERVICES - SERVICE COORDINATORS $156,741
14.895 JOBS-PLUS PILOT INITIATIVE $153,684
14.871 SECTION 8 HOUSING CHOICE VOUCHERS $146,734