FAC Explorer

Finding 497906 (2023-003)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-09-23
Audit: 320485
Organization: Howard County Housing Commission (MD)
Auditor: Cliftonlarsenallen LLP

AI Summary

  • Core Issue: The Commission failed to enforce timely consequences for landlords and tenants whose units did not pass inspections, leading to noncompliance with HUD requirements.
  • Impacted Requirements: The PHA must ensure life-threatening deficiencies are corrected within 24 hours and all other deficiencies within 30 days, or abate Housing Assistance Payments (HAP) accordingly.
  • Recommended Follow-up: Review and improve abatement procedures to ensure compliance with HQS standards and enforce correction of deficiencies effectively.

Finding Text

2023-003 - HQS Failed Inspections Federal Program: Housing Choice Voucher Program FALN: 14.871/14.879 Federal Award Identification Nuber and Year: MD023,2023 Award Period: 1/1/2023 - 12/31/2023 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance (Modified Opinion) Criteria or specific requirement: For units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HQS deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified incorrect period or must terminate the HAP contract (24 CFR sections 982.158(d) and 982.404). Condition: The Commission did not properly enforce consequences to landlords or tenants of units that did not pass inspections in a timely manner. Questioned costs: Unknown Context: During our testing of 40 files for HQS enforcement, we noted the following: - 27 of 40 units tested failed inspection due to owner responsibilities and the Commission never abated HAP. - 2 of 40 units tested failed due to tenant responsibilities and the Commission did not take proper steps to enforce family obligations. Cause: HCHC employs a third-party inspection company. Many of the issues caused by the previous inspection company did not surface until early in 2023. Effect: The Commission is not in compliance with HUD requirements. This could have an impact on HAP paid. Repeat finding: Yes, 2022-004 Recommendation: We recommend the Commission review their abatement procedures to ensure that for any unit that has not met the HQS standards that HAP is properly abated as well as review their procedures for enforcing correction of deficiencies to tenants. Views of responsible officials: There is no disagreement with the audit finding.

Corrective Action Plan

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – HQS Enforcement Recommendation: We recommend the Commission review their abatement procedures to ensure that any unit that has not met the HQS standards that HAP is properly abated as well as review their procedures for enforcing correction of deficiencies to tenants. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The following actions are currently taking place to ensure abatement procedures are met when required due to failed inspections: • Hired a new Inspection company. • The HCHC will ensure that its third-party HQS inspectors provide data on all fails that require abatement as part of the weekly report. • The assigned HCV Specialist will notify the landlord and tenant of the failed inspection and the specific deficiencies that must be corrected. • The assigned HCV Specialist will notify the tenant and landlord of potential termination for not complying with inspection requirements as a result of two consecutive no shows. • The assigned HCV Specialist will ensure that the third-party inspection company re-inspects in a timely manner to verify that the repairs have been completed and meet HQS standards. • If the landlord fails to make the repairs by the established deadline, the HCHC will initiate abatement procedures by withholding or reducing housing assistance payments (HAP) once the unit passes inspection. • The assigned HCVP Specialist will provide the tenant with information and assistance to find alternative housing, such as issuing a new voucher, extending the search time, or offering relocation expenses. • The HCHC will terminate the HAP contract with the landlord if the unit remains abated for more than 60 days or if the landlord fails to comply. Name(s) of the contact person(s) responsible for corrective action: Crystal Gorham, Director of Rental Assistance Planned completion date for corrective action plan: The new inspection protocols were put into place as of July 1, 2024. If the U.S. Department of Housing and Urban Development has questions regarding this plan, please call Crystal Gorham at 443-518-7818.

Categories

HUD Housing Programs Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

  • 497904 2023-001
    Significant Deficiency
  • 497905 2023-002
    Material Weakness Repeat
  • 497907 2023-001
    Significant Deficiency
  • 497908 2023-002
    Material Weakness Repeat
  • 497909 2023-003
    Material Weakness Repeat
  • 1074346 2023-001
    Significant Deficiency
  • 1074347 2023-002
    Material Weakness Repeat
  • 1074348 2023-003
    Material Weakness Repeat
  • 1074349 2023-001
    Significant Deficiency
  • 1074350 2023-002
    Material Weakness Repeat
  • 1074351 2023-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $26.23M
14.879 Mainstream Vouchers $1.40M
14.218 Community Development Block Grants/entitlement Grants $361,341
14.241 Housing Opportunities for Persons with Aids $229,967
21.023 Emergency Rental Assistance Program $96,322
14.896 Family Self-Sufficiency Program $6,011