Finding Text
Federal agency: U.S. Department of Housing and Urban Development
Federal program title: Housing Choice Voucher Cluster
Assistance Listing Number: 14.871/14.879
Federal Award Identification Number and Year: CA005/CA007 2022
Award Period: January 1, 2022 – December 31, 2022
Type of Finding:
• Significant Deficiency in Internal Control over Compliance and Other Matter
Criteria or specific requirement: Eligibility
Most PHAs devise their own application forms that are filled out by the PHA staff during an interview with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to obtain information from third parties; (b) a federally prescribed general release form for employment information; and (c) a privacy notice. Under some circumstances, other members of the family are required to sign these forms (24 CFR sections 5.212 and 5.230).
The PHA must do the following:
(1) 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 (24 CFR sections 5.230, 5.609, and 982.516).
(2) 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 (24 CFR section 982.516).
(3) Determine income eligibility and calculate the tenant’s rent payment using the documentation from third-party verification in accordance with 24 CFR Part 5 Subpart F (24 CFR section 5.601 et seq.) (24 CFR sections 982.201, 982.515, and 982.516).
(4) 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 (24 CFR section 982.516).
Condition: During the testing of the Housing Choice Voucher Program tenant files, certain special provision compliance deficiencies were noted. Of the tenant files provided, auditor noted the following items:
- 1 instance where the housing authority processed annual examination with a wrong calculation of income per EIV.
Questioned costs: None
Context: Out of 40 HCV tenant files tested, 1 tenant files contained errors as noted above.
Cause: The housing authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations, as well as their administrative policy.
Effect: The Authority is not in compliance with federal regulations regarding the calculation of the rent and verification of the tenants income.
Repeat Finding: This is a Repeat finding. (2021-002)
Recommendation: WE recommends management should designate one person to review a sample of the files that have been recertified each month. The purpose of the review is to determine if the tenant files were prepared in accordance with internal policies and verify the compliance deficiencies have been corrected.
Views of responsible officials: There is no disagreement with the audit finding.