Finding 2023-001:
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program Titles: Housing Voucher Cluster
Federal Assistance Listing Numbers: 14.871, 14.879, and 14.EHV
Noncompliance – E. Eligibility – Tenant Files
Non Compliance Material to the Financial Statements: Yes
Material Weakness in Internal Control over Compliance for Eligibility. Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). These files are required to be maintained and available for examination at the time of audit.
Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit.
Context: There are approximately 6,531 units. Of a sample size of seventy-seven (77) tenant files, the following was noted:
- Section 214 citizen declaration form missing in 15 files
- HUD 9887 consent to release information form missing in 2 files
- Original application missing in 1 file
- Annual inspection missing in 1 file
- Lead based paint form missing in 4 files
- Verification of income missing in 6 files
Our sample size is statistically valid.
Known Questioned Costs:
14.871 - Section 8 Housing Choice Vouchers - $36,728
14.879 - Mainstream Vouchers - $13,028
14.EHV - Emergency Housing Vouchers - $1,272
Cause: There is a material weakness in the Housing Voucher Cluster in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance.
Effect: The Housing Voucher Cluster is in material non-compliance with the eligibility type of compliance related to the maintenance of tenant files.
Recommendation: We recommend the Authority design and implement internal control procedures that will assure compliance with the Uniform Guidance and the compliance supplement.
Authority Response: The Authority accepts the recommendation of the auditor, and will make the several changes to its inspection process to ensure enforcement of Housing Quality Standards (or any subsequent replacement).
Views of responsible officials and planned corrective action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Housing Voucher Cluster to ensure that established internal control policies are being followed on a timely basis. Shannon Koenig, executive director and CEO, is responsible for implementing this corrective action by December 31, 2024.