Finding Text
2024-001 - Annual Physical Inspections Not Consistently Performed (Material Weakness, Material Non-Compliance)
Rural Rental Assistance Payments Program - Assistance Listing No. 10.427: Grant Period: Fiscal Year-End September 30, 2024.
Criteria: The Multi-Family Housing Programs and Asset Management Handbook (HB-2-3560) and the Code of Federal Regulations (CFR) Title 7, Subtitle B, Chapter XXXV, Part 3560 applicable to the Department of Agriculture, Rural Rental Housing provides guidance and criteria under which the Rural Rental Housing Payments Program is to be administered and operated. Specifically, Chapter 5 of the Handbook and CFR 3560.103(b) specify the performance of annual unit inspections.
Condition: During audit fieldwork, auditors requested annual inspection reports for ten sampled units. Housing Authority management was unable to provide applicable annual inspections for seven of the ten units requested.
Cause: Failure to perform inspections at the three applicable sites. Failure to execute controls over property inspection requirements of the Program.
Questioned Costs: None.
Effect: Non-compliance with federal requirements of the Program.
Recommendation: We recommend that the Housing Authority perform annual inspections on each of its Program properties. Management’s Response: The Housing Authority will perform annual inspections on each of its Program properties. The Housing Authority’s Executive Director, Jeff Sklet has assumed the responsibility of executing this corrective action as of September 30, 2025.