Finding 2025-008: Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Public and Indian Housing Program Federal Catalog Numbers: 14.850 Material Noncompliance Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Eligibility Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). These files are required to be maintained and available for examination at the time of audit. Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit. Context: There are approximately 1,086 units. Of a sample size of twenty-four (24) tenant files, the following was noted: - Citizenship declaration was missing in 1 file - HUD-9886 form was missing in 5 files - Signed lease was missing in 1 file. Our sample size is statistically valid. Known Questioned Costs: $48,870 Cause: There is a material weakness in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority experienced high turnover and did not properly train employees in the Public and Indian Housing department, which resulted in the Authority having a limited capacity to perform the required maintenance of tenant files, and properly maintain and monitor a system of internal controls that reasonably assures the program is in compliance. Effect: The Public and Indian Housing Program is in material non-compliance with the eligibility type of compliance related to the maintenance of tenant files. Recommendation: We recommend that the Authority implement a process whereby Authority personnel are hired and trained on tenant file maintenance so that documents are accumulated, stored and safeguarded to ensure compliance with the Uniform Guidance and the compliance supplement. Views of responsible officials and planned corrective action: The Authority has recognized the deficiencies in the Public Housing Program and will train staff on the proper maintenance of tenant files and implement internal control procedures that will ensure compliance with federal regulations. Malcom Isler, HCV Program Director/Interim Deputy Executive Director is responsible for ensuring proper internal controls are in place to prevent significant deficiencies and material weaknesses from occurring and is expected to be completed by July 31, 2026.