Finding 1206476 (2025-001)

FINDING No. 2025-001: Section 227/223(f) Mortgage Insurance for the Refinance of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: One hundred and seventy-four tenants. Sample Size Information: Twenty tenants. Identification of Repeat Finding and Finding Reference Number: Yes, 2024-001. Criteria:HUD regulations require all initial and ongoing tenant eligibility documentation to be obtained timely and maintained during tenancy. Statement of Condition: Missing documentation in tenant files: • Nine tenant files did not have EIVs obtained within 90 days of them being entered into TRACS with average EIVs exceeding 270 days. • One tenant file did not have the annual unit inspection report. • One tenant file did not have evidence of an EIV report pulled during annual recertification. • One tenant file did not have the house rules lease addendum. • Three tenant files did not have a move-in unit inspection report. • One tenant file had a move-in unit inspection completed 6 days after the tenant moved in. Cause: Due to turnover of the property manager position, the Project did not administer the Section 8 program in accordance with HUD regulations. Effect or Potential Effect: Unable to verify tenant eligibility and cost of assistance may be disallowed. Auditor Non-Compliance Code: R – Section 8 Program Administration Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: The Project should implement procedures to ensure that proper initial eligibility procedures are conducted for potential tenants and that tenant files are accurately maintained. Response Indicator: Agree Completion Date: 9/30/2026 Response: Staff training has been provided with additional HUD training inclusive of EIV reporting and tenant file maintenance and included in monthly reporting procedures.