Finding Text
Finding 2022-005 ? Information on the federal program: CFDA 14.872; U.S Department of Housing and Urban Development; Public Housing Capital Fund; annual contributions contract number FW-7097; fiscal year ending March 31, 2022. ? Criteria or specific requirement (including statutory, regulatory, or other citation): Period of Performance in accordance with 24 CFR 905 and the PHA Annual and 5-Year Action Plan. ? Condition: The audit identified exceptions in properly obligating and expending Capital Fund Programs (CFP) in accordance with CFP program requirements. ? Questioned costs: There were no questioned costs, although the PHA must obligate at least 90 percent of each CFP program within 24 months of the funds of becoming available to the PHA for obligation. Additionally, unless HUD approves an extension, the PHA must expend all grant funds no later than 48 months after HUD executes the ACC Amendment, 24 CFR section 905.306(f). Failure to properly obligate/expend for any month during the fiscal year, HUD shall withhold all new Capital Fund grants from any PHA that has unobligated funds in violation of the obligation/expenditure requirements. The penalty will be imposed once the violations are known. ? Context: CFP 501-17 has not been closed out, although is fully expended. CFP 501-18 is 47% expended as of August 26, 2022. There has been no disbursement activity in CFP?s 501-19, 501-20, 501-21, or 501-22. ? Effect: Non-compliance with the period of performance requirements could result in the loss of future CFP funding. ? Cause: Weakness in internal controls over managing the CFP?s in accordance with the PHA Annual and 5-Year Action Plan. ? Identification as a repeat finding: This is not a repeat audit finding. ? Recommendation for Corrective Action: Establish and enforce controls over administration of CFP?s to ensure safe, sanitary, and affordable dwellings are maintained for the purpose of serving families of low-income status in accordance with 24 CFR section 905. ? Views of Responsible Officials and Planned Corrective Actions: We will review existing control procedures to correct these deficiencies. We are currently working with contractors to complete improvement projects in a timely manner. We will also provide increased supervision and training over the administration of Capital Fund Programs. We anticipate a complete resolution of this type of error by December 31, 2022.