Finding Text
The PHA must determine that the rent to owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract: (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a five percent decrease in the published Fair Market Rent in effect 60 days before the HAP contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent (initially and during the term of the HAP contract) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). The above requirements were not met for the 2022 audit. During the audit we selected 10 tenants to test, we noted 10 out of the 10 tenants had no rent reasonableness analysis completed. The Authority did have a payment standard in place, however, they did not complete rent reasonableness analyses for 10 out of 10 of the tested in our Eligibility testing. If we extrapolate this error rate, the entire population did not have this completed. The Authority was in violation of the Federal Regulation which could have resulted in overpayment of Housing Assistance Payments (HAP). We recommend that Management implement procedures to ensure compliance with the above regulations as it relates to the Housing Choice Voucher Program. Management agrees with the finding and have outlined a plan of action in the corrective action plan section of this report.