Finding Text
2021-002
Federal agency: U.S. Department of Housing and Urban Development
Federal program title: Housing Choice Voucher Cluster
Assistance Listing Number: 14.871
Award Period: January 1, 2021 – December 31, 2021
Type of Finding:
Noncompliance and Significant Deficiency in Internal Control over Compliance
Criteria or specific requirement: Eligibility
Most PHAs devise their own application forms that are filled out by the PHA staff during an interview
with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to
obtain information from third parties; (b) a federally prescribed general release form for employment
information; and (c) a privacy notice. Under some circumstances, other members of the family are
required to sign these forms (24 CFR sections 5.212 and 5.230).
The PHA must do the following:
(1) As a condition of admission or continued occupancy, require the tenant and other family members
to provide necessary information, documentation, and releases for the PHA to verify income eligibility
(24 CFR sections 5.230, 5.609, and 982.516).
(2) For both family income examinations and reexaminations, obtain and document in the family file
third party verification of (1) reported family annual income; (2) the value of assets; (3) expenses
related to deductions from annual income; and (4) other factors that affect the determination of adjusted
income or income-based rent (24 CFR section 982.516).
(3) Determine income eligibility and calculate the tenant’s rent payment using the documentation from
third party verification in accordance with 24 CFR Part 5 Subpart F (24 CFR section 5.601 et seq.) (24
CFR sections 982.201, 982.515, and 982.516).
(5) Reexamine family income and composition at least once every 12 months and adjust the tenant rent
and housing assistance payment as necessary using the documentation from third party verification (24
CFR section 982.516).
Condition: During the testing of the Housing Choice Voucher Program tenant files, certain special
provision compliance deficiencies were noted. Of the tenant files provided, auditor noted the following items: - 2 instances where the housing authority failed to process annual examination within 12 months.
Questioned costs: $30,898
Context: Out of 40 HCV tenant files tested, 2 tenant files contained errors as noted above.
Cause: The housing authority failed to provide adequate monitoring and oversight to ensure
compliance with HUD rules and regulations, as well as their administrative policy. Effect: The Authority is not in compliance with federal regulations regarding the calculation of the rent
and verification of the tenants income.
Recommendation: We recommend management should designate one person to review a sample of
the files that have been recertified each month. The purpose of the review is to determine if the tenant
files were prepared in accordance with internal policies and verify the compliance deficiencies have
been corrected.
Views of responsible officials: There is no disagreement with the audit finding.