Finding 560406 (2023-003)

Finding No. 2023-003 Condition – In September 2023, HUD suspended its HAP subsidy to the Organization due to noncompliance regarding the tenant recertifications requirements under the HAP Contract. Criteria – Occupancy personnel are expected to have a strong knowledge of the various compliance requirements regarding tenant recertifications. Controls should be in place to ensure noncompliance is detected and corrected on a timely basis. Cause – The system of quality review that was in place was not sufficient to detect all instances of noncompliance with file documentation. Effect – There is a possibility that, under the HAP Contract, HUD may invoke any remedies available by law to redress the breach or compel compliance by the Organization with the tenant recertification requirements. Recommendation – We recommend that control systems are put in place to ensure there are regular reviews of tenant files to enable management to identify deficiencies and provide training, guidance, and procedures to eliminate errors and issues of noncompliance in the future. Auditor noncompliance code – S – Internal Control Deficiencies Reporting views of responsible officials - Management understands the importance of the matter and the issues that arise if tenant recertifications are not completed. The circumstances surrounding the noncompliance related to tenant recertifications were reviewed, and a procedural change has been implemented. Concur or do not concur with this finding - Concur Agree or disagree with auditor recommendations – Agree Completion date or proposed completion date – December 18, 2024 Actions taken or planned on the finding – The Organization will implement procedures to ensure the management agent complies with the tenant recertification requirements.