Finding 386518 (2023-001)

Reference Number: 2023-001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Home Investment Partnership Assistance Listing Number: 14.239 Federal Award Identification Number and Year: M21-UC240203 - 2021 & M22-UC240203 – 2022 Award Period: 7/12021 – 6/30/2029 and 8/3/2022 – 9/1/2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or Specific Requirement: During the period of affordability (i.e., the period for which the nonfederal entity must maintain subsidized housing) for HOME assisted rental housing, the participating jurisdiction must perform on-site inspections to determine compliance with property standards and verify the information submitted by the owners no less than (a) every three years for projects containing one to four units, (b) every two years for projects containing five to 25 units, and (c) every year for projects containing 26 or more units. The participating jurisdiction must perform on-site inspections of rental housing occupied by tenants receiving HOME/HOME-ARP-assisted tenant-based rental assistance to determine compliance with housing quality standards (24 CFR sections 92.209(i), 92.251(f), and 92.504(d)). Regarding HOME-ARP funds: the rental units must comply with the same requirements as HOME per 24 CFR 92.251 for (a) new construction, (b)rehabilitation projects, (c)(1) and (2) acquisition of standard housing, (e) manufactured housing, and (f) on-going property condition standards. Regarding HOME-ARP funds: the rental units must comply with the same requirements as HOME per 24 CFR 92.251 for (a) new construction, (b)rehabilitation projects, (c)(1) and (2) acquisition of standard housing, (e) manufactured housing, and (f) on-going property condition standards. Condition: The County did not perform onsite inspections of housing occupied by tenants receiving home-assisted tenant -based rental assistance to determine compliance with housing quality standards. Questioned Costs: None Context: The County did not conduct the annual inspections for all units as required Cause: The County’s policies and procedures were not sufficient to ensure that the required onsite inspections of rental housing occupied by tenants receiving HOME-assisted tenant-based rental assistance to determine compliance with housing quality standards. Effect: Compliance with housing quality standards was not ensured in the absence of inspections. There is an increased risk that the tenants living in substandard housing conditions that do not meet the minimum requirements for health and safety. Repeat Finding : No Recommendation: We recommend the County develop internal controls and procedures to ensure Housing Quality Standard requirements are met. We further recommend the County develop a tracking system to ensure all tenants receiving HOME-assisted tenant-based rental assistance are inspected timely. Views of Responsible Officials: The County agrees with the finding.