Finding Text
2022-002 Eligibility
Moving to Work Demonstration Program AL No. 14.881
Material Weakness in Internal Control
Material Noncompliance
Condition: Out of an approximate population of 17,109 of Section 8 Housing Choice Voucher and 2,511 Low Rent Public Housing tenants the following deficiencies were noted:
Section 8 Housing Choice Voucher (a total of 36 tenants selected for testing):
• Twelve files did not have annual recertifications performed during the year,
• Ten files did not have an annual recertification performed within 12 months,
• Eight files did not have 9886 release of information forms within 15 months of annual recertification,
• Five files did not have a 214 declaration form for all members of the household,
• Five files did not have documentation necessary to verify the reported income,
• Three files did not use the correct payment standard,
• One file did not have the documentation necessary to verify utility allowance,
• One file did not have necessary support to agree to Housing assistance payment (“HAP”), and
• One file did not have an inspection performed during the year.
Low Rent Public Housing (a total of 40 tenants selected for testing):
• Twenty-seven files did not contain flat rent options forms,
• Twenty-one files did not have a 214 declaration for a member of the household,
• Seventeen files did not have annual recertifications performed within 12 months of the previous annual certification,
• Thirteen files did not have income support necessary to verify tenant income,
• Nine files did not have 9886 release of information form within 15 months of the annual recertification,
• Six files did not have the annual recertification performed or documented, and
• Three files had 50058 forms displaying different rent payments than those on the rent roll.
Criteria: The Authority’s ACOP, Administrative Plan, 24 CFR 960.259, and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete, and accurate tenant files.
Context: The auditor randomly selected tenant files out of the population from each program as outlined, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files.
Cause: The Authority experienced staffing and operational challenges during the onset of COVID-19 and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments.
Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided.
Questioned Costs: Unknown.
Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample.
Management Response: See Corrective Action Plan.