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Finding No. 2025-001 - E - Eligibility for Uniform Guidance - Significant Deficiency Name of Federal Agency: Department of Housing and Urban Development Federal Program Name: Supportive Housing For The Elderly Assistance Listing Number: 14.157 Federal Award Identification Number and Year: 126EE030, program year 2023. 126-EE030, program year 2001 Name of Pass-Through Entity (if applicable): Not Applicable 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 Programs. Condition: In connection with our lease file review, we noted that: -one out of three tenants' income verification was not performed at all with the use of the HUD Enterprise Income Verification ("EIV"). -one out of two tenants' recertifications were not performed timely. Cause: Management's policies with respect to recertifications and 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 recertification 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. Questioned Costs: N/A Context: One out of three tenants tested did not have an EIV performed timely and one out of two tenants' recertifications were not performed timely. Auditor Noncompliance Code: Z-Other for REAC filing Identification as a Repeat Finding: Yes, 2024-001 Recommendation: Management should establish procedures and monitor compliance with those procedures to ensure that EIVs are performed timely, 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. Finding Resolution Status: Unresolved Views of Responsible Officials and Planned Corrective Actions: REACH has policies in place to complete EIVs and recertifications in a timely manner but due to staffing shortages and tenant noncompliance issues the property continued to have issues with timely completion of income certifications in 2025. In 2026 property management will be outsourced to a third party management company to address outstanding compliance issues.