Finding 35511 (2022-001)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2022-11-20

AI Summary

  • Core Issue: The Authority failed to properly document tenant income and expenses, leading to non-compliance with federal regulations.
  • Impacted Requirements: The lack of third-party verification for income and deductions violates 24 CFR section 982.516.
  • Recommended Follow-Up: The Authority should enhance internal controls to ensure accurate documentation of tenant income and expenses for compliance.

Finding Text

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879 Award Period: April 1, 2021 ? March 31, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: For both family income examinations and reexaminations, the PHA must 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). Condition: In a population of over 250 tenant files, exceptions were noted in 5 out of 40 files tested. ? In 2 out of 40 files, the Authority was not able to support the dependent allowance included as a deduction from annual income. ? In 3 out of 40 files, the Authority was not able to support the reported family annual income. Questioned costs: Unable to determine. Context: 40 tenant files were selected from a population of over 250. The sample was statistically valid. Cause: The Authority did not maintain income or expense related file documentation in the tenant's file. Effect: The Authority is not in compliance with federal regulations regarding eligibility. The Housing Assistance Payment (HAP) calculation may be inaccurate resulting in an underpayment or overpayment of HAP. Repeat Finding: No Recommendation: We recommend that the Authority reviews its internal controls over obtaining and maintaining income and expense tenant file documentation to ensure compliance with eligibility requirements. Views of responsible officials: There is no disagreement with the audit finding.

Corrective Action Plan

Recommendation: We recommend that the Authority reviews its internal controls over obtaining and maintaining income and expense tenant file documentation to ensure compliance with eligibility requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Huntsville Housing Authority (HHA) is restructuring the Assisted Housing Department to add additional management positions, implement comprehensive standard operating procedures, which will include clearly defined eligibility processes and enhanced quality control measures, to include, provisions to appropriately determine dependent allowances. Management will conduct oversight of key functions, data entry, and maintain a consistent review of regulatory compliance. Management will complete more targeted and a higher number of internal quality control audits. Additionally, HHA will increase staff training on income, assets, expenses, deductions and rent calculations. This approach will also include obtaining and maintaining the correct backup and support documentation. HHA will also contract with a Housing Choice Voucher (HCV) consultant to provide additional training to the Assisted Housing management team. HHA is committed to ensuring that all employees have proper training in all components of the HCV program Name(s) of the contact person(s) responsible for corrective action: Turkessa Coleman Lacey, Deputy Executive Director

Categories

HUD Housing Programs Eligibility Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 35512 2022-002
    Significant Deficiency
  • 611953 2022-001
    Significant Deficiency
  • 611954 2022-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $13.23M
14.850 Public and Indian Housing $7.74M
14.872 Public Housing Capital Fund $3.69M
14.267 Continuum of Care Program $282,457
14.896 Pih Family Self-Sufficiency Program $280,818
14.879 Mainstream Vouchers $268,080
14.870 Resident Opportunity and Supportive Services - Service Coordinators $192,188
14.871 Covid-19 Housing Choice Vouchers Cares Act $135,071
14.850 Public Housing Cares Act $130,782
97.109 Disaster Housing Assistance Grant $59,718
14.871 Emergency Housing Vouchers $8,471