Finding 479421 (2023-001)

DEPARTMENT OF EDUCATION Continuum of Care Program - Grant No. CO0083L8T042113, Grant Period September 1, 2022 - August 31, 2023; Grant No. CO0061L8T042114, Grant Period July 1, 2022 - June 30, 2023 Condition: Significant Deficiency - A rental rate comparison to HUD published fair market rents was not performed for one tenant out of the 37 cases selected for testing. Criteria: 24 CFR Questioned costs: $0 Context: Where grants are used to pay rent for individual housing units, the rent paid must be reasonable in relation to rents being charged for comparable units taking into account relevant features. In addition, the rents may not exceed rents currently being charged by the same owner for comparable unassisted units, and the portion of rents paid with grant funds may not exceed HUD-determined fair market rents. Cause: The Organization was unable to provide a manager approved rental rate comparison due to turnover within the Organization. Effect: Tenant could be paying above market rent and/or HUD reimbursing the Organization for more than they should be in accordance with HUD-determined fair market rents. Repeat finding: (2022-001). Recommendation: HPP needs to complete an annual rent reasonableness calculation for all tenants. This should be completed by a case manager, and the tenant file reviewed independently by the Director of Housing. View of Responsible Official and Planned Corrective Action: Management agrees with the finding. See corrective action plan.