Finding 497980 (2023-003)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2023
Accepted
2024-09-24
Audit: 320643
Organization: Maine Sate Housing Authority (ME)

AI Summary

  • Core Issue: MaineHousing failed to provide original Housing Assistance Payment (HAP) and lease contracts for 2 out of 25 tenants during eligibility testing.
  • Impacted Requirements: This violates HUD's documentation retention criteria, risking inaccuracies in subsidy payments.
  • Recommended Follow-Up: MaineHousing should recover and retain the missing contracts and agreements to ensure compliance and accuracy.

Finding Text

2023-003: Housing Voucher Cluster – Eligibility – Document Retention Federal Program: Housing Voucher Cluster Assistance Listing No.: 14.871/14.879 Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: None Federal Award Identification Number: ME901/COVID-19 ME901/ME901MS5 Repeat Finding: This is not a repeat finding Criteria – As a condition of admission or continued occupancy, HUD requires the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). Housing Assistance Payment (HAP) contracts are maintained between MaineHousing and property owners to define the number of units eligible for subsidy. Lease agreements are maintained between property owners and tenants. Condition – MaineHousing maintains both HAP contracts and lease agreements for property owners and beneficiaries under the Housing Choice Voucher program. For 2 of 25 tenants selected for eligibility testing, MaineHousing could not provide the original HAP and lease contracts. Questioned costs – None. Cause – During 2023, MaineHousing removed certain records from its system for contracts and agreements that were no longer in effect. Certain records that were still currently in effect were removed inadvertently. Effect or potential effect – There is a risk that HAP contracts and lease agreements that are maintained by MaineHousing may not be current, resulting in errors in subsidy payments. Context – For 2 of 25 tenants selected for eligibility testing, MaineHousing could not provide the original HAP and lease contracts. The sample was a statistically valid sample. Recommendation – MaineHousing should review any documentation that was inadvertently disposed and work with property owners to restore and retain the most recent HAP contracts and lease agreements with tenants. Views of responsible officials – Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the Summary Schedule of Prior Audit Findings.

Corrective Action Plan

2023-003: Housing Voucher Cluster – Eligibility – Document Retention Name of Contact Person(s): Allison Gallagher, Director of Housing Choice Vouchers Management’s Views and Corrective Action Plan: Signed HAP contracts and lease agreements are required for every new lease up and MaineHousing will not release payment to the owner until those signed documents are received. These agreements state the contract rent and subsidy amounts at the time of the initial lease. Annually, each tenant is recertified and a contract amendment is generated with the current contract rent and subsidy amounts listed. These amendments are filed with the original documents. Management is certain that proper rent and subsidy payments were made based on annual and interim recertification documents on file. A new electronic file retention process was implemented in 2022, which involved organizing and converting volumes of physical files to electronic files. Since implementation of the new process, we have determined that some unit information for certain tenants was inadvertently discarded during conversion. Program staff are identifying missing unit information as they process annual recertification or when an outside party requests it and reaching out to the owner to obtain a copy of the signed original documents. The two HAP and lease contracts identified in this finding have been obtained. Management believes that the electronic file retention process currently in place is working well and this was isolated to the period of time when files were being organized and scanned from physical files to electronic files. Proposed Completion Date: Completed

Categories

HUD Housing Programs Eligibility

Other Findings in this Audit

  • 497979 2023-002
    Significant Deficiency
  • 497981 2023-004
    Significant Deficiency
  • 1074421 2023-002
    Significant Deficiency
  • 1074422 2023-003
    Significant Deficiency
  • 1074423 2023-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.327 Performance Based Contract Administrator Program $81.67M
21.026 Homeowner Assistance Fund $27.76M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $13.57M
21.023 Emergency Rental Assistance Program $13.44M
21.027 Coronavirus State and Local Fiscal Recovery Funds $9.87M
93.568 Low-Income Home Energy Assistance $8.11M
81.042 Weatherization Assistance for Low-Income Persons $6.00M
14.275 Housing Trust Fund $2.42M
93.558 Temporary Assistance for Needy Families $1.55M
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $1.46M
14.871 Section 8 Housing Choice Vouchers $972,061
14.U01 Recovery Housing Program $869,573
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $598,475
14.267 Continuum of Care Program $389,266
93.499 Low Income Household Water Assistance Program $367,075
14.261 Homeless Management Information Systems Technical Assistance $341,588
14.900 Lead-Based Paint Hazard Control in Privately-Owned Housing $255,173
14.921 Older Adults Home Modification Grant Program $240,368
14.879 Mainstream Vouchers $163,086
14.326 Project Rental Assistance Demonstration (pra Demo) Program of Section 811 Supportive Housing for Persons with Disabilities $98,903
14.896 Family Self-Sufficiency Program $85,830
14.231 Emergency Solutions Grant Program $63,963
14.239 Home Investment Partnerships Program $32,432