Finding Text
2022-002 Special Tests and Provisions Continuum of Care. Condition: HONOR ehg Inc. had no recorded of or did not perform controls over reasonable rental rates in 2022. ??Criteria: Per 2 CFR part 200, Appendix IX, Compliance Supplement, rents paid must be reasonable in relation to rents being charged for comparable units taking into account relevant features. In addition, rents may not exceed rents currently being charges by the same owner for comparable unassisted units, and the portion of rents paid with grant funds may not exceed HUD-determined fair market rents. Grant funds in the amount of 1 months rent may be used to pay the non-recipient landlord for any damages to leased units by home less participants. Context: 8 of 9 tenants selected did not have Rent Reasonableness Certifications performed per HONOR's policy in 2022. Cause: HONOR ehg, Inc. did not perform rent reasonableness certifications annually and the Finance department does not track tenant portion of rents due. Effect: Due to lack of controls, Honor was not in compliance with the Continuum of Care Reasonable Rental Rates component. Recommendation: We recommend that HONOR ehg Inc. perform annual rent reasonableness certifications on all tenants whose rent is paid by COC funding. Rent reasonableness Certifications should document comparable rental units in the area, cost of other rental units from the same landlord and that the rent portion funded by COC funds is at or below the Fair Market Rent published annually.