Finding 35326 (2022-002)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-04-17
Audit: 24060

AI Summary

  • Core Issue: One tenant did not receive their security deposit refund within the required 30 days after moving out.
  • Impacted Requirements: This violates HUD's lease requirements outlined in the Occupancy Handbook.
  • Recommended Follow-Up: Implement procedures to ensure timely processing of security deposit refunds to comply with regulations.

Finding Text

Assistance List Number: 14.157 - Supportive Housing for the Elderly (Section 202) - Capital Advances and Project Rental Assistance Contract Federal Agency: U.S. Department of Housing and Urban Development Federal Award Numbers in Cluster: N/A Federal Award Years in Cluster: January 1, 2022 - December 31, 2022 Pass-Through Entity: N/A Criteria: Under the HUD Occupancy Handbook, Chapter 6: Lease Requirements and Leasing Activities, within 30 days after the move-out date, the owner must either refund the full security deposit plus accrued interest to a tenant that does not owe any amounts under the lease or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant's rights under state and local laws. Questioned Costs: None. Condition: One out of ten selected tenants who moved out during the year did not receive their security deposit refund check within the 30-day requirement. This was not a statistically valid sample. Context: We identified one tenant (for one out of ten selected tenants) that moved out during the year that did not receive their refund of their security deposit within the 30-day requirement. Pennsauken Lutheran Housing, Inc. HUD Project No. 035-EE020 Schedule of Findings and Questioned Costs Year Ended December 31, 2022 30 Effect: There was one tenant whose security deposit refund check was not received within the 30-day requirement. Cause: There was turnover at the property manager position and the property manager position remained vacant for several months of the year. Additionally, there were environmental issues that caused mold and destruction of certain files. Recommendation: We recommend the Corporation implement procedures to ensure that all security deposit refund checks are returned to tenants within the 30-day requirement.

Corrective Action Plan

Planned Corrective Actions: We will re-enforce the use of the move out file checklist as a tool for project managers to utilize. We will review the move out activity and follow up with the close out processing at the site level. We will also have the move out files sent to the housing administrative assistant as a check, so as to not miss the deadline and process refunds in the required 30-day cycle.

Categories

Subrecipient Monitoring HUD Housing Programs

Other Findings in this Audit

  • 35327 2022-003
    Significant Deficiency Repeat
  • 35328 2022-002
    Significant Deficiency
  • 35329 2022-003
    Significant Deficiency Repeat
  • 611768 2022-002
    Significant Deficiency
  • 611769 2022-003
    Significant Deficiency Repeat
  • 611770 2022-002
    Significant Deficiency
  • 611771 2022-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $501,085