Finding 575243 (2024-001)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2024
Accepted
2025-08-29

AI Summary

  • Core Issue: The Housing Authority has compliance gaps in tenant file management, including late recertifications and missing documentation.
  • Impacted Requirements: Non-compliance with HUD regulations and the Housing Authority’s Administrative Plan regarding timely and accurate tenant file management.
  • Recommended Follow-Up: Review and improve internal controls, address deficiencies in tested files, and assess potential impacts on the entire tenant population.

Finding Text

Condition: Out of a population of approximately 43,000 tenants for the Housing Voucher Cluster, 41 tenant files were tested and the following exceptions were noted: • 6 files had late recertification performed of which 1 missed getting an annual recertification in 2024; • 2 files were missing 214 form documentation for household members; • 1 file had an incorrect income calculation; • 1 file had an incorrect payment standard; and • 1 file had a missing valid 9886 form. Context: The auditor haphazardly selected 41 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and supporting documentation to ensure proper procedures are being followed and that the Housing Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Criteria: The Housing Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Housing Authority experienced staffing and operational challenges during the year and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments. Effect: The Housing Authority is not in full compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor’s Recommendations: The Housing Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to recertifications. The Housing Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. View of Responsible Officials: See Corrective Action Plan.

Corrective Action Plan

Management Response and Corrective Action: Section 8 Management acknowledges the findings and remains committed to strengthening internal controls to ensure full compliance with HUD requirements for timely, complete, and accurate tenant files. To address the identified deficiencies and prevent future occurrences, the Housing Authority has taken the following corrective actions and implemented several operational and structural improvements: 1. Process Improvement and Oversight In mid-2022, the Housing Authority engaged Guidehouse, Inc., a national consulting firm specializing in public sector housing, to conduct a comprehensive review of Section 8 program operations. The recommendations from Guidehouse have been implemented. As part of HACLA’s transition to a new tenant software system in 2025, the department continues to make additional process improvements to further enhance accuracy, efficiency, and compliance. Key initiatives completed and sustained include: • Program Tracking and Performance Indicators Implemented a set of 30 program and performance indicators, a new Quality Control reporting system, and a Program Tracking and Performance Management Plan. Status: Completed and ongoing. • Housing Policy and Program Alignment Conducted benchmarking with peer agencies and academic institutions to identify 13 best practices across six strategic areas. These informed updates to policy and procedure. Status: Completed. • Workforce and Workload Optimization Assessed workload distribution and processing times, leading to the creation of a new generalist job classification. This has improved workload balance and increased staffing flexibility. Status: Completed; ongoing assessment continues for current classifications as they become vacant. HACLA evaluates and identifies when the new generalist position is appropriate based on program needs. • Training Program Development Identified training gaps and implemented a Training Program Implementation Plan that includes a structured training schedule, development of new materials, and outcome evaluations to ensure consistent and effective staff development. Status: Completed and ongoing. 2. File Corrections and Monitoring For all file-specific deficiencies noted in the audit sample, HACLA has contacted the families and either corrected the errors or will complete corrections within 30 days. Supervisory staff will verify completion and ensure updates are reflected in the system of record. 3. Enhanced Oversight and Accountability Section 8 leadership — including the Deputy Director and Assistant Directors — are providing ongoing oversight through managers and supervisors to ensure continued adherence to program requirements. This includes regular monitoring, corrective actions when necessary, and administrative accountability measures.   4. Timeframe and Responsible Parties These corrective actions are either completed or ongoing as part of our broader operational plan. Oversight for implementation and monitoring is the responsibility of the Deputy Director of Section 8, in coordination with Assistant Directors, managers, and supervisors across the program. Person Responsible: Director of Section 8

Categories

HUD Housing Programs Eligibility Internal Control / Segregation of Duties

Other Findings in this Audit

  • 575244 2024-001
    Significant Deficiency
  • 575245 2024-001
    Significant Deficiency
  • 575246 2024-002
    -
  • 1151685 2024-001
    Significant Deficiency
  • 1151686 2024-001
    Significant Deficiency
  • 1151687 2024-001
    Significant Deficiency
  • 1151688 2024-002
    -

Programs in Audit

ALN Program Name Expenditures
14.195 Section 8 Housing Assistance Payments Program $1.03B
14.871 Section 8 Housing Choice Vouchers $72.30M
14.267 Continuum of Care Program $52.91M
21.019 Coronavirus Relief Fund $34.60M
14.872 Public Housing Capital Fund $32.70M
14.850 Public and Indian Housing $25.80M
14.249 Section 8 Moderate Rehabilitation Single Room Occupancy $5.98M
14.889 Choice Neighborhoods Implementation Grants $4.50M
14.879 Mainstream Vouchers $2.86M
14.241 Housing Opportunities for Persons with Aids $2.19M
14.856 Lower Income Housing Assistance Program Section 8 Moderate Rehabilitation $2.02M
14.888 Lead-Based Paint Capital Fund Program $1.11M
14.896 Family Self-Sufficiency Program $1.04M
93.310 Trans-Nih Research Support $395,957
14.191 Multifamily Housing Service Coordinators $357,886
14.895 Community Project Funding $353,485
17.258 Wioa Adult Program $335,822
10.727 Inflation Reduction Act Urban & Community Forestry Program $237,536
21.027 Coronavirus State and Local Fiscal Recovery Funds $226,725
14.892 Choice Neighborhoods Planning Grants $166,901
17.278 Wioa Dislocated Worker Formula Grants $128,335
14.870 Resident Opportunity and Supportive Services - Service Coordinators $73,671
14.218 Community Development Block Grants/entitlement Grants $46,000
66.312 Environmental Justice Government-to-Government (ejg2g) Program $27,848
32.011 Affordable Connectivity Outreach Grant Program $17,780
93.558 Temporary Assistance for Needy Families $4,096