Finding Text
Criteria: Rents being charged to the program must be comparable to similar units, in addition to being below fair market rents. The Organization completes a rent reasonableness form for each unit, that evaluates the unit with other comparable units as well as determines if the rent being charged is not greater than the fair market rent. Condition: During our testing for rent reasonableness, we noted the Organization was retroactively completing the rent reasonableness form for a majority of the units, making the determination as to whether or not comparable rent was being paid. Cause: The housing department experienced personnel turnover, alongside strained capacity in the accounting division. Effect: Rent being charged to the program could be in excess of rents for comparable units or greater than the fair market rent. Repeat Finding: Prior year finding 2023-007. Recommendation: The Organization should implement procedures to ensure that rent reasonableness forms are being prepared timely, and that all rents being charged are comparable to similar units and below fair market rent. Response: Management has implemented procedures for rent-reasonableness determinations and supporting comparisons to be completed and documented before lease execution or renewal. Required documentation will be maintained in a centralized electronic repository. Housing staff will receive training on the revised procedures, and management will perform periodic reviews to verify timely completion and retention of required documentation.