Finding 6172 (2023-001)

2023-001 Condition: Deficiencies Noted in SEMAP Compliance Assistance Listing #: 14.881 Questioned Costs: None Criteria: 24 CFR 985.507 states that “The PHA may not approve a lease until the PHA determines that the initial rent to owner is a reasonable rent.” Cause/Effect: The PHA did not have sufficient internal controls in place to ensure that each rent change or new move in voucher had a rent reasonableness documentation in the file. The Authority was not in compliance with rent reasonableness requirements. Recommendation: We recommend the Authority adjust its procedures to ensure that all new leases and rent increases have a determination of rent reasonableness and the documentation is retained in the files for review. Reply: We concur with this finding and the Auditor’s recommendation. We will adjust our procedures to ensure that all new leases and rent increases have a determination of rent reasonableness and the documentation is retained in the files for review. Management will implement procedures to clear this finding in FY 2024.