Finding 973148 (2023-001)

Finding No. 2023-001; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted the following deficiencies:  One out of ten existing tenants tested had EIVs that were performed outside of the 120- day EIV window.  One out of one new tenants tested had an initial EIV certification that was performed outside of the 90-day EIV window. Cause Management's policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs There are no questioned costs. Identification as a Repeat Finding This is a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: Section 202 Supportive Housing for the Elderly program administration. Finding Resolution Status: Resolved. Views of Responsible Officials The Franklin Johnston group has strict EIV policies and procedures in place. Although HUD requires quarterly reports, we require monthly reports for our Master Binder. Site teams are only permitted to pull the “By Head of Household Report” at the time of the recertification appointment. They do not pull 120 ,90 , 60 or 30 days in advance. The report is pulled at the time the recertification packet is completed. The site teams pull this report 90 days after a MI is submitted to TRACS. We pull this report 90 days that a resident receives a utility check as well. There are other EIV reports as it relates to specific tasks. All site teams members have been trained as it relates to this policy. In addition to this training all site teams are required to attend monthly EIV training.