Finding Text
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program Name: Housing Choice Voucher Program
Assistance Listing Number: 14.871
Federal Award Identification Number and Year: TX017 – 2023
Award Period: July 1, 2022 through June 30, 2023
Type of Finding:
Significant Deficiency in Internal Control over Compliance
Other Matters
Criteria or Specific Requirement: 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).
(4) Select tenants from the HCVP waiting list (see III.N.1, “Special Tests and Provisions – Selection from the Waiting List”) (24 CFR sections 982.202 through 982.207).
(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).
Prior Year Finding: This finding is a repeat finding in the immediate prior year. Prior year finding number was 2022-002.
Condition: During our testing, we noted the Authority did not have adequate internal controls designed to ensure that eligibility requirements were being met.
Questioned Costs: None
Context: Out of 40 tenants tested, there were exceptions in 9 tenant files. Our sample was a statistically valid sample.
One instance where there was a difference of income reported on the HUD-50058 and the third party verification
One instance where Medicare expenses were not included as a medical allowance
Seven instances where annual recertifications were not processed annually
Cause: The Authority does not have controls in place to ensure it is meeting all eligibility requirements set by HUD.
Effect: The Authority is not in compliance with program requirements over eligibility.
Recommendation: The Authority should implement processes to ensure that all documentation is received and that the correct inputs are being accurately reported on the HUD-50058.
View of Responsible Officials: Management agrees with the finding.