Finding 9634 (2023-001)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2023
Accepted
2024-01-24
Audit: 13310
Organization: Detroit Housing Commission (MI)

AI Summary

  • Core Issue: The Commission failed to complete annual tenant recertifications for fiscal year 2023, leading to potential inaccuracies in housing assistance payments.
  • Impacted Requirements: Noncompliance with federal regulations requiring annual income verification and tenant eligibility assessments.
  • Recommended Follow-Up: Implement procedures for annual recertifications and retrain staff to ensure compliance with HUD standards, with ongoing monitoring and reporting.

Finding Text

Assistance Listing Number, Federal Agency, and Program Name Housing Vouchers Cluster 14.871 and 14.879 Federal Award Identification Number and Year Not applicable Pass through Entity Not applicable Finding Type Material weakness and material noncompliance with laws and regulations Repeat Finding Yes 2022 001 Criteria Under 24 CFR 5.230, 5.609, 982.201, 982.515, 982.516, and 982.516, the Commission must: a. 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. b. 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. c. Determine income eligibility and calculate the tenant’s rent payment using the documentation from third party verification. d. Select tenants from the HCVP waiting list (see special tests and provisions HCVP waiting list). e. 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. Condition The Commission did not complete fiscal year 2023 recertifications. Questioned Costs Unknown Identification of How Questioned Costs Were Computed Not applicable Context 60 tenant files were tested, and the results are as follows: A total of 5 participant files did not include fiscal year 2023 recertifications. Cause and Effect The Commission did not have the proper controls in place to ensure that the tenant recertifications are completed annually for each tenant. Due to the lack of adequate controls, recertifications were not performed and housing assistance payments could be incorrect. Recommendation The Commission should establish procedures to ensure participant recertifications are documented and completed annually. Views of Responsible Officials and Corrective Action Plan Staff will be retrained on the compliance requirements under the standards of the HCV Program through the oversight of the rental assistance department manager and continued occupancy supervisor. The department manager and supervisor will continue to utilize all Yardi monitoring reports to ensure the department is operating in accordance with industry standards. Reporting will be done and monitored monthly to meet set goals. We know and maintain we will work in accordance with HUD rules and regulations where annual recertification processes are concerned. On a weekly basis, the department manager will review the certification pipeline to ensure compliance and follow up with the housing specialist to ensure compliance and that set weekly and monthly goals and metrics are met.

Corrective Action Plan

Finding Number: 2023-001 Condition: DHC did not complete fiscal year 2023 recertification. Planned Corrective Action: Staff will be retrained on the compliance requirements under the standards of the HCV Program through the oversight of the Rental Assistance Department Manager and Continued Occupancy Supervisor. The Department Manager and Supervisor will continue to utilize all Yardi monitoring reports to ensure the Department is operating in accordance with industry standards. Reporting will be done and monitored monthly to meet set goals. We know and maintain we will work in accordance with HUD rules and regulations where Annual Recertification processes are concerned. Weekly; Department Manager will review the certification pipeline to ensure compliance and follow up with the Housing Specialist to ensure compliance and meeting set weekly and monthly goals and metrics. Contact person responsible for corrective action: Felicia Burris, HCV Program Manager Anticipated Completion Date: 6/30/2023

Categories

HUD Housing Programs Subrecipient Monitoring Eligibility Material Weakness Reporting Special Tests & Provisions

Other Findings in this Audit

  • 9635 2023-002
    Material Weakness Repeat
  • 9636 2023-003
    Significant Deficiency
  • 9637 2023-001
    Material Weakness Repeat
  • 9638 2023-002
    Material Weakness Repeat
  • 9639 2023-003
    Significant Deficiency
  • 9640 2023-001
    Material Weakness Repeat
  • 9641 2023-002
    Material Weakness Repeat
  • 9642 2023-003
    Significant Deficiency
  • 586076 2023-001
    Material Weakness Repeat
  • 586077 2023-002
    Material Weakness Repeat
  • 586078 2023-003
    Significant Deficiency
  • 586079 2023-001
    Material Weakness Repeat
  • 586080 2023-002
    Material Weakness Repeat
  • 586081 2023-003
    Significant Deficiency
  • 586082 2023-001
    Material Weakness Repeat
  • 586083 2023-002
    Material Weakness Repeat
  • 586084 2023-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $49.71M
14.850 Public and Indian Housing $17.87M
14.872 Public Housing Capital Fund $11.20M
14.879 Mainstream Vouchers $654,926
14.870 Resident Opportunity and Supportive Services - Service Coordinators $352,408
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $298,013
14.895 Jobs-Plus Pilot Initiative $281,008
17.274 Youthbuild $196,777
14.871 Covid-19 - Section 8 Housing Choice Vouchers $96,017