Finding 972023 (2022-002)

Significant Deficiency Repeat Finding
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2024-05-01

AI Summary

  • Core Issue: The housing authority has a significant deficiency in internal controls, leading to incorrect income calculations for tenant rent.
  • Impacted Requirements: Compliance with eligibility verification and income calculation regulations under HUD guidelines is not being met.
  • Recommended Follow-Up: Assign a dedicated reviewer to monthly audits of recertified tenant files to ensure compliance and correct deficiencies.

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.

Categories

HUD Housing Programs Subrecipient Monitoring Eligibility Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 395580 2022-002
    Significant Deficiency Repeat
  • 395581 2022-002
    Significant Deficiency Repeat
  • 395582 2022-002
    Significant Deficiency Repeat
  • 395583 2022-003
    Significant Deficiency
  • 395584 2022-003
    Significant Deficiency
  • 395585 2022-003
    Significant Deficiency
  • 395586 2022-004
    Significant Deficiency
  • 395587 2022-004
    Significant Deficiency
  • 395588 2022-004
    Significant Deficiency
  • 395589 2022-005
    Significant Deficiency Repeat
  • 395590 2022-005
    Significant Deficiency Repeat
  • 395591 2022-005
    Significant Deficiency Repeat
  • 395592 2022-006
    Material Weakness Repeat
  • 395593 2022-007
    Material Weakness Repeat
  • 395594 2022-008
    Significant Deficiency Repeat
  • 395595 2022-008
    Significant Deficiency Repeat
  • 972022 2022-002
    Significant Deficiency Repeat
  • 972024 2022-002
    Significant Deficiency Repeat
  • 972025 2022-003
    Significant Deficiency
  • 972026 2022-003
    Significant Deficiency
  • 972027 2022-003
    Significant Deficiency
  • 972028 2022-004
    Significant Deficiency
  • 972029 2022-004
    Significant Deficiency
  • 972030 2022-004
    Significant Deficiency
  • 972031 2022-005
    Significant Deficiency Repeat
  • 972032 2022-005
    Significant Deficiency Repeat
  • 972033 2022-005
    Significant Deficiency Repeat
  • 972034 2022-006
    Material Weakness Repeat
  • 972035 2022-007
    Material Weakness Repeat
  • 972036 2022-008
    Significant Deficiency Repeat
  • 972037 2022-008
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $153.46M
14.239 Home Investment Partnerships Program $133.18M
21.023 Emergency Rental Assistance Program $85.47M
14.218 Community Development Block Grants/entitlement Grants $45.30M
14.231 Emergency Solutions Grant Program - Cares Act $11.89M
14.850 Public and Indian Housing $9.83M
14.218 Community Development Block Grants/entitlement Grants - Section 108 $6.88M
14.267 Continuum of Care Program $5.21M
14.889 Choice Neighborhoods Implementation Grants $4.48M
14.872 Public Housing Capital Fund $3.64M
14.871 Section 8 Housing Choice Vouchers - Emergency Housing $3.58M
14.879 Mainstream Vouchers $1.57M
14.231 Emergency Solutions Grant Program $1.22M
14.241 Housing Opportunities for Persons with Aids $988,103
14.896 Family Self-Sufficiency Program $256,540
14.857 Lower Income Housing Assistance Program Section 8 Moderate Rehabilitation $240,636
14.870 Resident Opportunity and Supportive Services - Service Coordinators $234,262
14.900 Lead-Based Paint Hazard Control in Privately-Owned Housing $138,168
66.814 Brownfields Training, Research, and Technical Assistance Grants and Cooperative Agreements $85,027