Finding Text
Federal Agency: Housing and Urban Development
Federal Program Title: Housing Choice Voucher Cluster
Assistance Listing Number: 14.871 and 14.879
Federal Award Identification Number and Year: FL063, 2023
Award Period: April 1, 2022 to March 31, 2023
Type of Finding: Material Weakness in Internal Control over Compliance, Material
Noncompliance (Modified Opinion)
Criteria or specific requirement: Most PHAs devise their own application forms that are filled out by the PHA staff during an interview with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to obtain information from third parties; (b) a federally prescribed general release form for employment information; and (c) a privacy notice. Under some circumstances, other members of the family are required to sign these forms (24 CFR sections 5.212 and 5.230).
The PHA must do the following:
(1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516).
(2) For both family income examinations and reexaminations, obtain and document in the family file third party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or income-based rent (24 CFR section 982.516).
(3) Determine income eligibility and calculate the tenant’s rent payment using the documentation from third party verification in accordance with 24 CFR Part 5 Subpart F (24 CFR section 5.601 et seq.) (24 CFR sections 982.201, 982.515, and 982.516).
(5) Reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payment as necessary using the documentation from third party verification (24 CFR section 982.516).
Condition: During the testing of the Housing Choice Voucher Program tenant files, certain special provision compliance deficiencies were noted. Of the tenant files provided, auditor noted the following items:
Number of Instances Finding
1 The Authority was unable to locate and provide the tenant file
1 The Authority failed to process a move out
1 Contract rent was higher than what was prescribed on the rent reasonableness form
Questioned Costs: $11,471
Context: Of the 25 tenant files tested, 3 tenant files contained the errors as noted above.
Cause: The Authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations, as well as their administrative policy.
Effect: The Authority is not in compliance with federal regulations regarding document retention and timely processing of examination.
Repeat Finding: No
Recommendation: We recommend management should designate one person to review a sample of the files that have been recertified each month, to determine if the tenant files were prepared in accordance with internal policies and until the compliance deficiencies have been corrected.
Views of responsible officials: There is no disagreement.