Finding 980412 (2023-003)

Material Weakness
Requirement
E
Questioned Costs
$1
Year
2023
Accepted
2024-06-28

AI Summary

  • Core Issue: The Authority improperly charged tenants for lawn care and pest control fees, totaling $41,659 from 2019 to 2023.
  • Impacted Requirements: HUD regulations mandate that the Authority cover maintenance costs, meaning these fees should not be passed on to residents.
  • Recommended Follow-Up: The Authority needs to reimburse tenants for the inappropriate charges and reconcile the amounts owed, considering not all residents were billed.

Finding Text

2023-003 Ineligible fees for lawn care and pest control charged and paid by residents of Authority units (Activities Allowed or Unallowed) Criteria: Under HUD rules and regulations, the Authority is required to provide decent and safe rental housing for eligible low-income families, the elderly, and persons with disabilities. As such, the Authority is required to maintain the property as part of its operations. The cost of maintaining services for lawn care and pest control is a requirement of the Authority and should be paid for by the Authority’s program. Condition: It was determined that the Authority was charging $3 per unit per month for pest control and $5 per unit per month for pest control to each tenant. The amount due back to tenants for the years 2019-2023 totaled $41,659. Questioned Costs: $41,659 Effect: The Authority was recognizing revenues charged to tenants inappropriately and using these funds for operating expenses. Cause: The Authority did not realize that it could not charge its residents for both lawn care services and pest control. Recommendation: The Authority should reimburse all fees charged to tenants that were charged inappropriately. Management Response: A response cannot be directed to this finding until the amounts are reconciled to determine the amounts owed as not all of the residents were charged for lawn care (elderly residents were not charged). It should also be noted that this was first brought to light during a HUD Review that was not completed until early December 2023.

Categories

Questioned Costs Eligibility HUD Housing Programs

Other Findings in this Audit

  • 403969 2023-002
    Material Weakness Repeat
  • 403970 2023-003
    Material Weakness
  • 403971 2023-004
    Material Weakness Repeat
  • 403972 2023-005
    Material Weakness
  • 980411 2023-002
    Material Weakness Repeat
  • 980413 2023-004
    Material Weakness Repeat
  • 980414 2023-005
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.850 Public and Indian Housing $749,003
14.872 Public Housing Capital Fund $533,179