Finding Text
Finding 2025-005 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster - Section 8 Housing Choice Vouchers and Emergency Housing Vouchers Federal Assistance Listing Numbers: 14.871 and 14.EHV Noncompliance - N. Special Tests and Provisions - Utility Allowance Schedule Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Special Tests and Provisions Criteria: Utility Allowance Schedule. The PHA must maintain an up-to-date utility allowance schedule. The PHA must review utility rate data for each utility category each year and must adjust its utility allowance schedule if there has been a rate change of 10 percent or more for a utility category or fuel type since the last time the utility allowance schedule was revised (24 CFR section 982.517). Condition: Based upon inspection of the Authority’s files and on discussion with management, the Authority did not perform the required annual review of utility rate data during the audit period. Management was unable to provide documentation evidencing that utility rates were evaluated to determine whether revisions to the utility allowance schedule were required. Context: During our compliance testing, we noted that the Authority did not perform the required annual review of utility rate information during the audit period. As a result, the Authority could not demonstrate compliance with the utility allowance schedule requirements applicable to the Housing Voucher Cluster. Known Questioned Costs: Unknown Cause: The Authority's procedures did not include a process to ensure the annual review of utility rate data was performed and documented, resulting in noncompliance with HUD's utility allowance schedule requirements. Effect: The Authority's failure to perform and document the required annual review of utility rate data resulted in noncompliance with HUD requirements and increased the risk that necessary revisions to the utility allowance schedule would not be identified and implemented timely. Recommendation: We recommend that the Authority implement procedures to ensure the required annual review of utility rate data is performed, documented, and used to determine whether revisions to the utility allowance schedule are necessary in accordance with HUD regulations.