Finding 592368 (2022-004)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2023-03-30

AI Summary

  • Core Issue: The Authority failed to assess rent reasonableness before increasing rent, violating compliance requirements.
  • Impacted Requirements: Must determine and document reasonable rent as per 24 CFR sections 982.158(f)(7) and 982.507.
  • Recommended Follow-Up: Implement controls to ensure rent reasonableness is evaluated before any rent changes take effect.

Finding Text

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Housing Voucher Cluster Assistance Listing Numbers: 14.871/14.879 Federal Award Identification Number and Year: SC911VO - 2022 Award Period: July 1, 2021 ? June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: The Authority must determine reasonable rent during the term of the contract before any increase in the rent to owner. The Authority must maintain records to document the basis for the determination that rent to owner is a reasonable rent (24 CFR sections 982.158(f)(7) and 982.507). Condition: The Authority did not perform rent reasonableness procedures in accordance with program compliance requirements. Questioned costs: Unable to determine. Context: A sample of 40 contract rent changes found that rent reasonableness was not performed prior to the rent increase in 2 instances. The sample was statistically valid. Cause: Rent reasonableness was not determined prior to the effective date of the rent change. Effect: The Authority is not in compliance with rent reasonableness requirements. Repeat Finding: No. Recommendation: We recommend the Authority implements controls to ensure that rent reasonableness is determined prior to the effective date of the change in rent. Views of responsible officials: There is no disagreement with the audit finding.

Categories

Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 15915 2022-001
    Material Weakness
  • 15916 2022-002
    Material Weakness
  • 15917 2022-003
    Significant Deficiency
  • 15918 2022-004
    Significant Deficiency
  • 15919 2022-001
    Material Weakness
  • 15920 2022-002
    Material Weakness
  • 15921 2022-003
    Significant Deficiency
  • 15922 2022-004
    Significant Deficiency
  • 15923 2022-001
    Material Weakness
  • 15924 2022-002
    Material Weakness
  • 15925 2022-003
    Significant Deficiency
  • 15926 2022-004
    Significant Deficiency
  • 15927 2022-001
    Material Weakness
  • 15928 2022-002
    Material Weakness
  • 15929 2022-003
    Significant Deficiency
  • 15930 2022-004
    Significant Deficiency
  • 15931 2022-005
    Significant Deficiency
  • 592357 2022-001
    Material Weakness
  • 592358 2022-002
    Material Weakness
  • 592359 2022-003
    Significant Deficiency
  • 592360 2022-004
    Significant Deficiency
  • 592361 2022-001
    Material Weakness
  • 592362 2022-002
    Material Weakness
  • 592363 2022-003
    Significant Deficiency
  • 592364 2022-004
    Significant Deficiency
  • 592365 2022-001
    Material Weakness
  • 592366 2022-002
    Material Weakness
  • 592367 2022-003
    Significant Deficiency
  • 592369 2022-001
    Material Weakness
  • 592370 2022-002
    Material Weakness
  • 592371 2022-003
    Significant Deficiency
  • 592372 2022-004
    Significant Deficiency
  • 592373 2022-005
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.023 Covid-19 Emergency Rental Assistance $230.71M
14.195 Section 8 Housing Assistance Payments Program $149.95M
14.239 Home Investment Partnerships Program $87.49M
21.026 Covid-19 Homeowner Assistance Fund $14.53M
14.871 Section 8 Housing Choice Vouchers $14.48M
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $9.30M
14.275 National Housing Trust Fund $1.69M
14.871 Section 8 Housing Choice Vouchers- Emergency Housing Vouchers $564,015
14.871 Section 8 Housing Choice Vouchers - Cares $513,332
14.879 Mainstream Vouchers $124,031
14.228 Hera Neighborhood Stabilization Program $3,867