Finding Text
Finding 2022 ? 001 ? Eligibility Federal agency: U.S. Department of Housing and Urban Development Federal program title: Housing Voucher Cluster Assistance Listing Numbers: 14.871 and 14.879 Award Period: October 1, 2021 to September 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Other Matters Criteria or specific requirement: The Authority must complete form HUD-50058 for each Housing Choice Voucher (HCV) and Mainstream Voucher tenant. Form HUD-50058 is used to determine a tenant?s eligibility and also determine the tenants? portion of rent and the Authority?s portion of the rent. 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 testing of tenant files, certain eligibility and reporting compliance deficiencies were noted as summarized below: Number of Instances Finding 11 Where the Authority was unable to provide a tenant file to review Section III ? Findings and Questioned Costs ? Major Federal Programs (Continued) Finding 2022 ? 001 ? Eligibility Of the files the Authority was able to provide. The files contained the following compliance deficiencies: Number of Instances Finding 46 Where the file was missing the Section 214 Declaration for family members 46 Where the income, assets, or expenses calculated on the 50058 was not supported 46 Where the Authority did not review the information on an annual basis 38 Where the file was missing the HUD-9886 authorization form 37 Where the file was missing the Authority general release form 23 Where the HAP information from the 50058 did not agree to support 23 Where the HAP Contract could not be verified to supporting documents 45 Where the Housing Choice Voucher?s tenant file was missing the preparer checklist that is utilized as an internal control to ensure all required elements are in the tenant file Questioned costs: Undeterminable. Context: Out of 60 housing choice vouchers and mainstream tenant files tested, 56 tenant files contained errors as noted above. The sample was a statistically valid sample. Cause: The Authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations, as well as their administrative plan. Effect: The Authority is not in compliance with federal regulations regarding eligibility requirements and the calculation of the rent and verification of the tenant?s income. Repeat Finding: This is a repeat finding from previous years. The finding numbers are 2017-001, 2018-001, 2019-001, 2020-001, and 2021-001. 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 unit the compliance deficiencies have been corrected. Views of responsible officials: There is no disagreement with the audit finding.