Finding Text
2023-004. Special Tests and Provisions
United States Department of Housing and Urban Development
Continuum of Care Program ALN: 14.267
Criteria: 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 HUDdetermined
fair market rents.
Condition: There were instances in which comparable rents for the area were not documented and
maintained in tenant files.
Cause: The Organization did not have an adequate control in place for the review by a supervisor of
every tenant file to ensure that permanent documentation to conclude that reasonable rent being
charged was maintained, rather because of staffing constraints, a review of a selection of tenant files
was performed for compliance with this criteria.
Potential Effect: The Organization may not be in compliance that grant funds to pay rent were used for
reasonable rent in relation to comparable rent in the area.
Questioned Costs: None reported.
Identification of a Repeat Finding: This is a repeat finding related to the 2022 audit, finding #2022-002.
Recommendation: The Organization should implement procedures for supervisory review of
documentation within all tenant files to ensure reasonable rent criteria is demonstrated.
Views of Responsible Officials of Auditee: The Organization agrees with the finding and will ensure
written documentation is maintained in tenant files, to support that the grant funds to pay rent were
used for reasonable rent in relation to comparable rents in the area.