Finding 504875 (2024-001)

Significant Deficiency Repeat Finding

Requirement

Questioned Costs

Year

2024

Accepted

2024-11-07

Audit: 327628

Organization: North Providence Housing Authority (RI)

Auditor: Marcum LLP

AI Summary

Core Issue: Ten instances of missing income verification were found during the audit, indicating a failure to follow HUD requirements.
Impacted Requirements: The Authority did not adequately verify family income and assets, leading to potential inaccuracies in tenant rent calculations.
Recommended Follow-Up: Create and use a recertification checklist to ensure all necessary documentation is collected for tenant files.

Finding Text

024-001 – ELIGIBILITY: RENT CALCULATION Other Matter/Significant Deficiency U.S. Department of Housing and Urban Development CFDA #: 14.871 / 14.879 – Housing Voucher Cluster CRITERIA For both family income examinations and reexamination, obtain and document in the family file third-party verification of (1) reported family annual income (2) the value of assets (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or income-based rent (24 CFR Section 982.516). Determine income eligibility and calculate the tenant’s rent payment using the documentation from third-party verification in accordance with 24 CFR Part 5 subpart F (24 CFR section 5.601 et seq.) (24CFR sections 982.201, 982.515, 982.516). CONDITION As a result of procedures, we identified ten instances of missing income verification. CAUSE The Authority’s system of internal control over the participant recertification process was not sufficient to meet the requirements established by HUD. EFFECT Redetermination of tenant’s rent and the housing assistance payment was not performed in accordance with HUD regulations. As a result, tenants may have paid more or less in rent than they should have paid. QUESTIONED COSTS None identified. CONTEXT We selected a sample of 40 from a population of 276. This was not a statistically valid sample. REPEAT FINDING See finding 2023-001 RECOMMENDATION We recommend that the Authority develop and implement a recertification checklist to accompany the tenant file to ensure all required documentation is obtained.

Corrective Action Plan

Section III – Federal Award Findings and Questioned Costs 2024-001-Eligibility: Rent Calculation Corrective Action: The North Providence Housing Authority will be creating a check list which will include Income Verification as part of the participants file to be used for examinations, and reexaminations of income. This check list will be completed by the Housing Authority staff member, signed, and dated, showing that all required documents have been obtained and used for a successful processing of the tenants rent. Additionally, due to being a small housing authority, with only one HCV staff member, we have hired an HCV Assistant to help the HCV Coordinator in obtaining all information needed to comply with HUD’s regulations. Planned Implementation Date of Corrective Action: Immediately Planned Implementation Date of Corrective Action: Eileen Reyes/Michael McMahon/Cheryl Lonardo

Other Findings in this Audit

504876 2024-001

Significant Deficiency Repeat
504877 2024-002

Material Weakness Repeat
504878 2024-002

Material Weakness Repeat
1081317 2024-001

Significant Deficiency Repeat
1081318 2024-001

Significant Deficiency Repeat
1081319 2024-002

Material Weakness Repeat
1081320 2024-002

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
14.871	Section 8 Housing Choice Vouchers	$2.52M
14.850	Public Housing Operating Fund	$590,018
14.872	Public Housing Capital Fund	$533,662
14.879	Mainstream Vouchers	$416,888
14.896	Family Self-Sufficiency Program	$74,718