FAC Explorer

Finding 515855 (2024-001)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2024
Accepted
2024-12-19
Audit: 333725
Organization: Housing Authority of the City of Raleigh (NC)
Auditor: Rector Reeder & Lofton PC

AI Summary

  • Core Issue: 17 tenant files had annual reexaminations overdue by over five months, indicating ongoing compliance challenges.
  • Impacted Requirements: Noncompliance with 24 CFR 982 and local policies on timely reexaminations and documentation of Housing Quality Standards inspections.
  • Recommended Follow-up: Promptly complete overdue reexaminations and enhance monitoring to ensure future compliance.

Finding Text

Finding 2024-001 – Housing Choice Voucher Program Tenant Files – Eligibility – Internal Control over Tenant Files – Noncompliance and Material Weakness - Housing Choice Voucher Program – ALN 14.871 Condition & Cause: We reviewed 100 Housing Choice Voucher tenant files to assess compliance with federal regulations and local policies. We found that 17 files had annual reexaminations completed more than three months past the due date, with an average delay of slightly over five months. Notably, the percentage of materially late reexaminations decreased from 27% in the previous year’s audit to 17% this year. Additionally, two files lacked documentation of a Housing Quality Standards (HQS) inspection conducted within the past 24 months. We attribute these discrepancies to the Agency’s ongoing challenges in hiring, training, and retaining qualified staff in the HCV department. We also observed discrepancies between the timeliness of annual reexaminations and the Authority’s FY 2024 SEMAP self-assessment for Indicator #9. Although we reviewed the supporting documentation for this indicator without finding deviations, it is important to investigate the discrepancy, especially since the Authority had a similar audit finding in the prior year (Finding 2023-001). Criteria: 24 CFR 982, the Housing Authority’s Administrative Plan, and specific HUD guidelines on documenting and maintaining Housing Choice Voucher tenant files. Effect: Late annual reexaminations can lead to inaccurate subsidy calculations, potentially resulting in overpayments or underpayments to landlords, thereby jeopardizing the program’s integrity. Recommendation: We recommend that the Agency identify and complete all overdue reexaminations promptly. The Agency should also continue to monitor this area for compliance to prevent future discrepancies. Questioned Costs: None Repeat Finding: Yes Was sampling statistically valid? Yes Views of responsible officials: The PHA agrees with the results of the audit and recommendations.

Corrective Action Plan

Finding 2024-001 – Housing Choice Voucher Program Tenant Files – Eligibility – Internal Control over Tenant Files – Noncompliance and Material Weakness - Housing Choice Voucher Program – ALN 14.871 Corrective Action Plan: Timeliness of Annual Recertifications RHA has implemented all strategies identified in the Corrective Action Plan in response to the previous audit’s finding regarding later annual recertifications, including, but not limited to: • Competitive compensation to attract and retain qualified employees. • Housing Choice Voucher Certification and other training to enhance RHA’s ability to comply with HUD regulations. • Reorganization of the department to implement case management to replace conveyor-belt style approach to annual recertifications to inject greater accountability for outcomes. • Improved supervisor to employee ratios to ensure that managers have reasonable supervisory loads (maximum of 1 TO 6). • Implementation of YARDI software to increase efficiency of our annual recertification processes. In addition to these corrective action strategies, RHA has also implemented state of the art information tools to track recertifications, measure timeliness and completion performance, and motivate staff and teams to perform at the highest level. The results of these efforts are in line with the expectation that was included in the previous corrective action plan: Anticipated Completion Date: These are mainly system changes that will be fully implemented in 2024, for example, new software, with significant improvements that will be evidenced by December 31, 2024. The results so far in December 2024 have exceeded expectations. For example, • As of December 1, 2024, 87% of recertifications with an effective date of January 1, 2025, had been completed. • As of December 16, 2024, 94% had been completed. • As of December 16, 2024, 73% of recertifications with a due date of January 1, 2025, and an effective date of February 1, 2025, have been completed. Our goal is to complete 90 to 95% by the due date, allowing for cases where participants are late in submitting their information. Having completed all corrective action strategies and plans, RHA expects results that will be in full compliance with completing annual recertification by their due date by July 31, 2025. Person Responsible: Priscilla Batts, HCV Director, is principally responsible and accountable for the outcome above.

Categories

HUD Housing Programs Eligibility Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

  • 515856 2024-002
    Material Weakness Repeat
  • 1092297 2024-001
    Material Weakness Repeat
  • 1092298 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.850 Public and Indian Housing $4.31M
14.872 Public Housing Capital Fund $2.97M
14.871 Section 8 Housing Choice Vouchers $1.08M
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $332,128