Finding 622978 (2022-002)

Material Weakness
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-02-27

AI Summary

  • Core Issue: Noncompliance with HUD regulations regarding tenant eligibility and lease file maintenance was identified in four out of six lease files.
  • Impacted Requirements: Failure to verify tenant income timely and complete annual recertification forms as required by HUD Handbook 4350.3.
  • Recommended Follow-Up: Management should implement and monitor procedures to ensure compliance with HUD guidelines, especially during transitions in management or ownership.

Finding Text

Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, Assistance Listing No. 14.157 Statement of Condition During the procedures applied to a sample of six tenant lease files, we noted the following instances of noncompliance with HUD regulations regarding tenant eligibility and the maintenance of lease files: 1. Four instances where the Project did not have documentation in their lease file that their income was timely verified. 2. One instance where the Project did not have annual tenant recertification Form 50059 completed timely. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Cause The Project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines during the transition to new management and new ownership. Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that the determination of tenant eligibility and the maintenance of lease files are in accordance with guidelines specified by HUD, even during transition of management and/or ownership. Auditor Noncompliance Code: R - Section 8 program administration; E - Eligibility (UG) Finding Resolution Status: Resolved Reporting Views of Responsible Officials Management agrees with the finding.

Categories

HUD Housing Programs Eligibility Reporting

Other Findings in this Audit

  • 46535 2022-001
    Material Weakness
  • 46536 2022-002
    Material Weakness
  • 46537 2022-001
    Material Weakness
  • 46538 2022-002
    Material Weakness
  • 622977 2022-001
    Material Weakness
  • 622979 2022-001
    Material Weakness
  • 622980 2022-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $6.85M