Finding Text
Finding: 2023-002
Program Name: Moving to Work (ALN #14.881)
Federal Awarding Agency: Department of Housing and Urban Development
Compliance Requirement: Special Tests and Provisions
Type of Finding: Material Weakness; Material Noncompliance Qualification
Criteria: Per 24 CFR section 990.280(d), the Authority may only charge centralized maintenance services to Public Housing projects on a fee-for-service approach. Each project must be charged for the actual services received and only to the extent that such amounts are reasonable.
Condition: During our testing of the reasonableness of centralized maintenance costs charged by the COCC, we noted work orders in which excessive hours were charged to public housing including multiple instances of more than 15 hours per day per employee charged as maintenance time.
Cause: Work orders prepared by maintenance staff were not reviewed for reasonableness.
Effect: The Authority was not in compliance with the special tests regarding fees charged for centralized services for the year ended June 30, 2023. After management’s review of all instances of excessive maintenance hours, management reduced fees charged by the COCC to the public housing program by $1.2 million.
Auditor Recommendation: We recommend supervisors review all time charged by maintenance staff on a routine basis. We would also recommend an additional review by the finance department to ensure hours are reasonable prior to posting charges to the Public Housing projects.
Questioned Costs: All costs were corrected and fees were reversed.
Management’s Response: To verify that the hours charged by maintenance staff are reasonable, Central Maintenance supervisors/coordinators will verify the accuracy of the hours recorded to work orders completed. Questionable hours will be reviewed and corrected when appropriate. The report will then be submitted to Financeto be charged to Public Housing development. The Finance Department will perform an additional review for reasonableness prior to posting.