Finding 561269 (2024-001)

- Repeat Finding
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2025-05-22
Audit: 356892
Auditor: Haynie & Company

AI Summary

  • No findings were reported for Internal Control over Financial Reporting for the year ended March 31, 2024.
  • Housing Authority is non-compliant with HUD requirements due to missing documentation for rent reasonableness in tenant files from a recent merger.
  • Recommend the PHA improve processes and systems to efficiently determine and document rent reasonableness for all increases as per HUD guidelines.

Finding Text

Internal Control over Financial Reporting There were no findings to report for the year ended March 31, 2024. Compliance 2024-01 – Housing Choice Voucher – Reasonable Rents Calculation and Documentation Condition -In our sample of 25 Housing Choice Voucher tenant files, the files that had been merged into the Authority from Emery County did not have documentation to support rent reasonableness for existing tenants with rental increases during the year. All of the tenants that had not been part of the merger had the required documentation. Effect – The Housing Authority is not in compliance with the HUD requirements for determining reasonableness rents for rent increases. Cause –Rental increases across all units is due to inflation and lack of supply has increased the number of tenant’s that need reasonable rent calculations performed. At the same time the staff available to perform the additional work has not changed. The current system used by the PHA to calculate and document the rent reasonableness is time not automated and so is time intensive for the Section-8 employee. Criteria – According to the HUD HCV Program guidebook paragraph 2.1.2: (emphasis added) Before the PHA may approve any rent increase to the owner, the PHA must determine and document whether the proposed rent is reasonable compared to similar units in the marketplace and not higher than those paid by unassisted tenants on the premises. Recommendation: The PHA should look at their process and system to see if they can make changes so they can quickly determine, and document rent reasonableness for all rent increases to the owner in accordance with HUD guidelines.

Corrective Action Plan

The Housing Authority will implement a standardized process for documenting rent reasonableness across all tenant files, including those from the Emery County merger, and will explore automated tools to streamline the determination and documentation process. Staff will also receive training to ensure compliance with the requirements moving forward.

Categories

HUD Housing Programs Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $1.31M
14.850 Public Housing Operating Fund $401,256
14.872 Public Housing Capital Fund $353,605
10.415 Rural Rental Housing Loans $217,975
14.U01 Emergency Housing Voucher $44,519
10.427 Rural Rental Assistance Payments $750