FAC Explorer

Finding 538108 (2024-001)

Material Weakness
Requirement
E
Questioned Costs
-
Year
2024
Accepted
2025-03-27
Audit: 349137
Organization: Town of Narragansett Housing Authority (RI)
Auditor: Cbiz CPAS PC

AI Summary

  • Core Issue: The Public Housing Authority (PHA) failed to conduct proper income verifications for housing vouchers, with nine instances of missing or insufficient documentation.
  • Impacted Requirements: The PHA did not meet the annual reexamination and verification criteria set by HUD, risking incorrect rent calculations and housing assistance payments.
  • Recommended Follow-Up: Management should enhance oversight, review compliance policies, and provide training on reexamination procedures to ensure adherence to requirements.

Finding Text

2024-001 – ELIGIBILITY Material Weakness/Material Noncompliance U.S. Department of Housing and Urban Development CFDA #: 14.871 – Housing Voucher Cluster CRITERIA PHA responsibility for reexamination and verification. (1) The PHA must conduct a reexamination of family income and composition at least annually. (2) The PHA must obtain and document in the tenant file third-party verification of the following factors, or must document in the tenant file why third-party verification was not available: (i) Reported family annual income; (ii) The value of assets; (iii) Expenses related to deductions from annual income; and (iv) Other factors that affect the determination of adjusted income. (24 CFR 982.516) CONDITION As a result of our audit, we identified nine (9) instances of missing income verifications or insufficient verifications. CAUSE The Authority did not properly oversee the administration of the Housing Choice Voucher Cluster program compliance. EFFECT The Authority is potentially incorrectly calculating and adjusting tenant rent and housing assistance payments which could create a burden on either the housing authority or the participant. QUESTIONED COSTS None identified. CONTEXT We selected a sample of 17 from a population of 172. This was not a statistically valid sample. REPEAT FINDING Not a repeat finding. RECOMMENDATION We recommend that the Authority’s management take an active role in reviewing their policies and monitoring the Authority’s compliance with those policies. We recommend that the Authority provide training for the performance of reexamination procedures. AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION See Corrective Action Plan.

Corrective Action Plan

Auditee’s Response and Planned Corrective Action Upon notification of the FYE June 30, 2024, audit deficiency, the NHA Executive Director immediately implemented a file checklist system for annual and interim recertifications for ALL client files. The checklist clearly presents income calculations – clearly identifying all income sources to include paystubs, award letters and 3rd party authentic documents, bank statements and EIV as income verifications and noting all qualified minor child and medical expenses utilized to determine accurate calculations of annual and monthly adjusted income. The NHA Executive Director also reviewed the files in question (along with randomly selected files) to assure the accuracy of Housing Assistance Payment calculations. HCV staff attended a recent training course for the recertification process on Wednesday February 5, 2025. Planned Implementation Date of Corrective Action: June 30, 2025 Person Responsible for Corrective Action: Cheryl Hartnett, Acting Executive Director

Categories

HUD Housing Programs Subrecipient Monitoring Eligibility Material Weakness

Other Findings in this Audit

  • 1114550 2024-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $2.13M
14.870 Resident Opportunity and Supportive Services - Service Coordinators $102,501
14.850 Public Housing Operating Fund $41,553
14.872 Public Housing Capital Fund $25,005