Finding 52023 (2022-002)

Material Weakness

Requirement

Questioned Costs

Year

2022

Accepted

2023-02-27

Audit: 49452

Organization: William Booth Residence, Inc., A Texas Corporation (TX)

Auditor: Cohnreznick LLP

AI Summary

Core Issue: Six tenant lease files were found noncompliant with HUD regulations regarding eligibility and documentation.
Impacted Requirements: Tenant lease files must adhere to HUD Handbook 4350.3 for proper maintenance and eligibility determination.
Recommended Follow-Up: Management should implement and monitor procedures to ensure compliance with HUD requirements for tenant eligibility and lease file maintenance.

Finding Text

Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of six tenant lease files, we noted six instances of noncompliance with HUD regulations regarding tenant eligibility and the maintenance of lease files, where the project did not maintain evidence of EIV report data in the lease file. Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility. Effect or Potential Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs None Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R - Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: Unresolved Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to year end with HUD approval and all tenant files were transferred to buyer. Therefore we consider this matter closed.

Corrective Action Plan

CORRECTIVE ACTION PLAN Project Legal Name: William Booth Gardens Apartments Houston, TX (? Project of William Booth Residence, Inc., A Texas Corporation) HUD Project No.: 114-EE006-NP-WAH Audit Firm: CohnReznick LLP Period covered by the audit: 10/1/2021-5/10/2022 (day before sale) Corrective Action Plan prepared by: Name: Sriparna Mitra Position: HUD Specialist, THQ (Legal) Telephone Number: 404-728-6700 A. Current Findings on the Schedule of Findings, Questioned Costs and Recommendations 2. Finding 2022-001 c. Comments on the Finding and Each Recommendation The auditee agrees with the finding that a sample of tenant lease files tested were missing evidence of EIV report data. d. Action(s) Taken or Planned on the Finding Management agrees with the finding. The property was sold prior to the end of FY 2022, with HUD approval, and all tenant files were trasnferred to the buyer. Therefore, we consider this matter closed. B. Status of Corrective Actions on Findings Reported in the Schedule of the Status of Prior Year Findings, Questioned Costs and Recommendations Finding 2021-001 Cleared.

Other Findings in this Audit

52022 2022-001

Significant Deficiency
52024 2022-001

Significant Deficiency
52025 2022-002

Material Weakness
628464 2022-001

Significant Deficiency
628465 2022-002

Material Weakness
628466 2022-001

Significant Deficiency
628467 2022-002

Material Weakness

Programs in Audit

ALN	Program Name	Expenditures
14.157	Supportive Housing for the Elderly	$3.31M