Finding Text
2022-001 Rent Reasonableness Controls. Condition: HONOR ehg Inc. rents paid for tenants within COC program exceeded Fair Market Rental Rates published by HUD. Criteria: Per 2 CFR part 200, Appendix IX, Compliance Supplement, rents paid must be reasonable in relation to rents being charged for comparable units taking into account relevant features. In addition, rents may not exceed rents currently being charges 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. Grant funds in the amount of 1 months rent may be used to pay the non-recipient landlord for any damages to leased units by home less participants. Context: 2 of 9 tenants selected rental payments exceeded HUD published Fair Market Rents based on location and unit type. 1 tenant selected has no documentation related to unit type to determine fair market rent applicability. 1 tenant selected had a security deposit that exceeded 1 months rent. Cause: HONOR ehg, Inc. does not perform rent reasonableness testing annual and does not track tenant portion of rents due. Effect: Honor is not in compliance with the Continuum of Care Reasonable Rental Rates component. Recommendation: We recommend that HONOR ehg Inc. perform annual rent reasonableness certifications on all tenants whose rent is paid by COC funding. Rent reasonableness certification should document comparable rental units in the area, cost of other rental units from the same landlord and that the rent portion funded by COC funds is at or below the Fair Market Rent published annually.