Finding Text
2024-001 Enhancing Control Over Tenant File Management and Safekeeping
Program Name/Assistance Listing Title: Supportive Housing for Persons with Disabilities
(Section 811)
Federal Assistance Listing No: 14.181
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Federal Award Finding
Compliance Requirements: Eligibility
Finding Resolution Status: In Process
Information on Universe Population Size: 18
Sample Size Information: 6
Criteria: The U.S. Department of Housing and Urban Development (HUD) requires that tenant
files be properly maintained to ensure compliance with federal regulations. Specifically:
HUD Handbook 4350.3: Occupancy Requirements of Subsidized Multifamily Housing
Programs state that owners and managers must maintain complete and accurate tenant
files to verify eligibility, income, and compliance with program requirements.
HUD's Tenant File Organization and Retention Guidelines emphasize the importance of
proper record-keeping and require that all necessary certifications, verifications, and
supporting documents be available for review
24 CFR § 5.240 – Verification of Eligibility mandates that owners and managers obtain
and retain adequate documentation to verify tenant eligibility, income, and other relevant
program criteria.
24 CFR § 5.233 – Mandated Use of EIV System requires that Section 811 properties and
other HUD-assisted programs use the Enterprise Income Verification (EIV) system in full
to verify tenant employment and income, and to reduce subsidy and rent calculation
errors.
Statement of Condition: During eligibility testing, the following were identified missing in the
tenant file documentation:
Unit 2-201 – Missing asset verification and second page of HUD 50059.
Unit 3-302 – Missing lease contract and asset verification
Unit 3-303 – Missing EIV report
Cause: The identified missing documents may be due to the absence of standardized filing
procedures for managing tenant records. Additionally, the lack of a structured system for
periodic file reviews and a comprehensive checklist of required documents may have contributed
to inconsistencies in record retention.
Potential Effect of Condition: Without a standardized filing and safekeeping process, there is
an increased risk of non-compliance with regulatory requirements, delays in tenant eligibility
verification, and inefficiencies in record retrieval. This could lead to audit findings, regulatory
reviews, or challenges in maintaining accurate tenant records.
Questioned Costs: The auditors have identified questioned costs of $24,052 for annual rental
subsidies. These questioned costs pertain only to the sample tested.
Reporting Views of Responsible Officials: The Organization agrees with the findings and
recommendations and will adhere to the corrective action plan.
Context: A review of tenant files identified missing documents, which may be due to the
absence of standardized filing procedures and routine file audits. Implementing structured
reviews and a checklist-based approach will help ensure completeness, compliance, and accurate
record-keeping.
Recommendation: To address the identified issues and ensure compliance with HUD
regulations, we recommend the following actions:
1. Complete the Missing Documents – Conduct a review of all tenant files to identify and
obtain any missing required documents, such as EIV reports, HUD 9887, Social Security
verifications, Declaration Forms, asset verifications, and recertifications. Ensure all
records are properly filed and up to date.
2. Develop and Implement Standardized Filing Procedures – Establish clear, written
guidelines for managing tenant records, including document organization, storage, and
retrieval processes. Provide staff with a checklist of required documents to ensure
consistency across all tenant files.
3. Establish Routine File Reviews Using a Checklist – Implement a structured system for
reviewing tenant files at least every quarter (end of Q3 and other scheduled intervals).
Use a standardized checklist to verify required documents and quickly identify missing or
incomplete records. Document findings and ensure prompt corrective action is taken.
4. Enhance Document Security and Accessibility – Implement safeguards to protect
physical and electronic tenant records, such as restricted access, secure storage solutions,
and digital backup procedures. Ensure documents are easily retrievable for audits and
internal reviews.
By completing missing documents, using a standardized checklist, and implementing quarterly
reviews, the organization can strengthen compliance, reduce risks, and improve efficiency in
tenant file management.
Management Response: Thank you for your recommendations. At Coolidge Court we strive to
operate with organization and efficiency. To mitigate risk and to remain in compliance with
HUD we will increase the chart review from semi-annually to quarterly to ensure that all
documents are filed and in order.
For unit 201, not including the asset verification was an oversite, but we do have it on file and
the 2nd page of the 50059 failed to upload but is in the tenant's chart.
For unit 302, all documents requested are filed, but there was an oversite with uploading.
For unit 303, a Citizen Declaration has been signed by the tenant which has been approved by
our HUD representative to take the place of the EIV while the tenant continues to make efforts to
obtain citizenship.
We appreciate your thoroughness and will continue to follow all the recommendations listed
above. We look forward to working with you in the future.