Finding 515778 (2024-004)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2024-12-19

AI Summary

  • Core Issue: The Commission lacks adequate internal controls, leading to noncompliance with Housing Quality Standards (HQS) inspections.
  • Impacted Requirements: Annual inspections of units leased under Section 8 must be conducted and documented as per HUD regulations.
  • Recommended Follow-Up: Implement processes to ensure complete documentation and timely inspections of tenant residences.

Finding Text

2024 – 004 – PBRA/MOD Housing Quality Standards Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Section 8 Project-Based Cluster Assistance Listing Number: 14.195/14.856 Federal Award Identification Number and Year: MD004 (various funding increments active during period 7/1/23 - 6/30/24) Award Period: July 1, 2023 through June 30, 2024 Type of Finding: -Material Weakness in Internal Control over Compliance. -Material Noncompliance (Modified Opinion) Criteria: PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS). The PHA must prepare a unit inspection report (24 CFR sections 880.612, 881.601, 882.516, 882.808(n), 883.701, 884.217, 886.123, and 886.323).). Condition: During our testing, we noted the Commission did not have adequate internal controls designed to ensure that inspection requirements were being met. As a result, inspections were not completed timely or at all. Questioned costs: Unknown Context: Testing of 60 PBRA tenant files for annual inspection standards revealed the following exceptions: -40 instances where tenant files were missing one or more inspections and when inspections were included, it was indeterminable whether they were within the regulatory period -26 files missing the letters sent to tenants informing them of the scheduled HQS inspections Cause: The Commission does not have controls in place to ensure it is meeting HQS inspection requirements set by HUD. Effect: The Commission is not in compliance with program requirements over HQS inspections. Repeat Finding: Yes Recommendation: The Commission should implement processes to ensure that all proper documentation is being maintained for inspections of tenant residences. View of Responsible Officials: There is no disagreement with the audit finding.

Corrective Action Plan

Section 8 Project-Based Cluster – Assistance Listing No. 14.195 / 14.856 Recommendation: The Commission should implement processes to ensure that all proper documentation is being maintained for inspections of tenant residences. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Pratum has implemented a policy requiring annual inspections to align with annual recertifications, ensuring compliance with HUD policies. Pratum Regional Property Managers will verify that all annual inspections and their corresponding forms are completed and properly filed in each resident's file. Additionally, a copy of the completed unit inspection form will be uploaded to Yardi along with the certification acket. Pratum will also ensure that all documentation related to scheduled HQS inspections is filed in the resident file and uploaded to Yardi, along with the completed unit inspection form. HOC’s PM Division has engaged an inspection vendor, Gilson Housing Partners, to conduct all annual inspections for the HOC managed properties. The inspections will begin on December 1, 2024 with PBRA communities being the priority. They will complete approximately 150 inspections per month and utilize Yardi Maintenance IQ for record keeping. The results of each inspection will be entered into the system by Gilson and HOC’s Maintenance and PM will have the responsibility of addressing all work.This partnership will ensure that all inspections are completed on schedule and meet the necessary standards. The Compliance team will continue to conduct bi-monthly quality control reviews for the HOC managed properties, after which relevant parties will convene to discuss corrective actions and training opportunities. This interactive process aims to ensure that discrepancies are addressed and corrected effectively. Name(s) of the contact person(s) responsible for corrective action: Carmen McLaurin, Vice President of Operation with Pratum, Darcel Cox, Vice President of Compliance with HOC and Ali Ozair, Vice President of Property Management with HOC. Planned completion date for corrective action plan: Pratum immediately implemented the corrective actions as outlined above and will commit to correcting all specific discrepancies by March 31, 2025. HOC’s third party inspections vendor will begin inspecting units no later than December 1, 2024 and perform annual inspections moving forward.

Categories

HUD Housing Programs Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

  • 515771 2024-001
    Material Weakness Repeat
  • 515772 2024-002
    Significant Deficiency
  • 515773 2024-001
    Material Weakness Repeat
  • 515774 2024-002
    Significant Deficiency
  • 515775 2024-001
    Material Weakness Repeat
  • 515776 2024-002
    Significant Deficiency
  • 515777 2024-003
    Material Weakness Repeat
  • 515779 2024-005
    Significant Deficiency Repeat
  • 515780 2024-006
    Material Weakness
  • 515781 2024-007
    Material Weakness
  • 515782 2024-008
    Significant Deficiency
  • 515783 2024-003
    Material Weakness Repeat
  • 515784 2024-004
    Material Weakness Repeat
  • 515785 2024-005
    Significant Deficiency Repeat
  • 515786 2024-006
    Material Weakness
  • 515787 2024-007
    Material Weakness
  • 515788 2024-008
    Significant Deficiency
  • 1092213 2024-001
    Material Weakness Repeat
  • 1092214 2024-002
    Significant Deficiency
  • 1092215 2024-001
    Material Weakness Repeat
  • 1092216 2024-002
    Significant Deficiency
  • 1092217 2024-001
    Material Weakness Repeat
  • 1092218 2024-002
    Significant Deficiency
  • 1092219 2024-003
    Material Weakness Repeat
  • 1092220 2024-004
    Material Weakness Repeat
  • 1092221 2024-005
    Significant Deficiency Repeat
  • 1092222 2024-006
    Material Weakness
  • 1092223 2024-007
    Material Weakness
  • 1092224 2024-008
    Significant Deficiency
  • 1092225 2024-003
    Material Weakness Repeat
  • 1092226 2024-004
    Material Weakness Repeat
  • 1092227 2024-005
    Significant Deficiency Repeat
  • 1092228 2024-006
    Material Weakness
  • 1092229 2024-007
    Material Weakness
  • 1092230 2024-008
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.188 Housing Finance Agencies (hfa) Risk Sharing $315.42M
14.267 Continuum of Care Program $4.11M
14.195 Project-Based Rental Assistance (pbra) $3.69M
14.879 Mainstream Vouchers $2.03M
14.871 Section 8 Housing Choice Vouchers $1.85M
93.086 Healthy Marriage Promotion and Responsible Fatherhood Grants $768,888
14.856 Lower Income Housing Assistance Program Section 8 Moderate Rehabilitation $429,791
14.896 Family Self-Sufficiency Program $367,956
14.269 Hurricane Sandy Community Development Block Grant Disaster Recovery Grants (cdbg-Dr) $134,147
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $67,225
93.045 Special Programs for the Aging, Title Iii, Part C, Nutrition Services $30,770