Finding 398554 (2023-003)

Finding No. 2023-003; Federal Assistance Listing Number 14.195, Section 8 Housing Assistance Payments Program Statement of Condition In connection with our lease files review we noted the following deficiencies: 1 out of 1 move-outs tested did not have the inspection signed by the tenant or an employee at the property. 1 out of 1 move-outs tested did not have the inspection dated by an employee at the property. 1 out of 1 move-ins tested did not have the tenant’s Enterprise Income Verification (“EIV”) performed timely within the 90 days HUD requires. Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Questioned Costs None Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause Management’s policies with respect to the determination of tenant security deposits and eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Identification as a Repeat Finding This finding is not a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code R - Section 8 program administration Reporting Views of Responsible Officials Management has hired a new Compliance Manager and engaged a third party compliance monitoring company to review all files and EIV processes effective May 1, 2024.