Finding Text
Direct Program Department of Housing and Urban Development FFAL #14.871 Section 8 Housing Choice Vouchers Special Tests and Provisions: Reasonable Rent Significant Deficiency in Internal Control over Compliance Criteria: As a condition of receiving Federal awards, non-Federal entities agree to comply with laws, regulations, and the provisions of grant agreements and contracts, and to maintain internal controls to provide reasonable assurance of compliance with these requirements. The Housing Choice Voucher program requires that recipients must determine that rent to the owner is reasonable in comparison to rent for other comparable unassisted units. Condition: The Authority was unable to provide documentation for the rent reasonableness comparison for 1 tenant during 2025. Cause: Controls over reasonable rent determination that are a part of special tests and provisions were not properly designed to ensure that comparisons were being retained. Effect: As a result of the failure to determine reasonable rent for units leased under the Housing Choice Voucher program, there is an increased risk that the Authority is overpaying landlords, which can result in noncompliance with HUD regulations. Questioned Costs: None reported Context/Sampling: We tested 29 out of a population of 149 new leases during 2025 based on maximum risk of material noncompliance. Repeat Finding from Prior Year(s): Yes Recommendation: We recommend management revisit controls to ensure that reasonable rent determinations are conducted and documented in accordance with HUD requirements. Views of Responsible Officials: There is no disagreement with the audit finding.