HOUSING AUTHORITY OF THE CITY OF COLUMBIALocal Government

Finding 2022-001 Significant Deficiency: Special Reporting - Compliance and Control Finding ALN 14.871 and 14.879 - Housing Voucher Cluster: Section 8 Housing Choice Vouchers Federal Agency: U.S. Department of Housing and Urban Development (HUD) Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirement: HUD requires Public Housing Authorities (PHA) to submit a Form HUD-50058 each time a family ends participation in the program or movesout of the PHA?s jurisdiction under portability within 60 days of the participants termination or exit of the program. Condition: The Authority did not submit the required form within the designated timeframe, nor did the existing control operate as intended to prevent the error from occurring. Cause: The control in place did not ensure timely submission of the HUD-50058. Effect: The possibility exists that noncompliance with federal requirements could go undetected regarding compliance relating to direct and material compliance requirements. Questioned Costs: None. Context: One of the 40 participants selected for testing did not have the HUD-50058 submitted within the required 60 day timeframe. Identification As A Repeat Finding: Not applicable. Recommendation: We recommend that management evaluate their existing control over the timely submission of the HUD-50058 upon a participant?s exit of the program, and consider implementing additional controls such as a review of a schedule of participants who exited the program monthly, to ensure the all required submissions to HUD take place on time. Views Of Responsible Officials: Management has developed a tracking chart to track submission of the HUD-50058 for participants exiting the program that will be monitored monthly.

Finding 2020-001 Material Weakness: Special Tests and Provisions - Control Finding CFDA 14.276 - Continuum of Care Federal Agency: U.S. Department of Housing and Urban Development (HUD) Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirement: HUD requires rents funded by federal grants be reasonable in relation to rents being charged in the area for comparable space. In addition, the rent may not exceed rents currently being charged by the same owner for comparable unassisted space (24 CFR section 578.5(b)(1)). Additionally, Uniform Guidance 2 CFR section 200.303 requires that controls over compliance be properly designed, in place and operating effectively to ensure compliance with the requirements of the federal program. Condition: A second review to verify accuracy of participant file documentation, including rent reasonableness, did not take place. Cause: Controls over compliance are not in place to ensure unit rental comparability forms are prepared accurately. Effect: The possibility exists that noncompliance with federal requirements could go undetected without proper controls over compliance relating to direct and material compliance requirements. Questioned Costs: None. Context: No auditable evidence exists to support the review of participant files which include rental unit comparison forms. Statistical sampling was not used to test this compliance requirement. Identification as a repeat finding: Not applicable. Recommendation: We recommend that management put a control in place for a second review of participant files to ensure all requirements for participating in the program are completed and retained. The review should be properly documented with the reviewer?s signature and the date the review was performed. The second review should be performed by someone other than the preparer and who has knowledge of the grant?s eligibility and rent reasonableness requirements. Views of Responsible Officials: The Housing Choice Voucher (HCV) Manager will pull files on a sample basis and conduct a second review of the file. The HCV Manager will keep a tracking chart of all files audited along with the completed file audit checklists for later review.

Finding 2020-002 Significant Deficiency: Eligibility and Special Tests and Provisions - Control Finding CFDA 14.871 - Section 8 Housing Choice Vouchers Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirements: 1. The PHA must determine that a participant is eligible through an income verification (24 CFR section 982.516) and calculation in accordance with 24 CFR part 5 subpart F. 2. The PHA must Reexamine family income and composition at least once every 12 months and adjust the participant rent and housing assistance payment as necessary using the documentation from third-party verification (24 CFR section 982.516). Condition: Income was not correctly calculated based on the support provided in the participant file. Cause: The Authority has internal controls in place related to participant file review whereby files are second reviewed on a sample basis due to the number of participants in the program. The participant files related to the two instances described below were not randomly selected for participant file review. Effect: While participants were found to be eligible for participation in both instances, a situation could arise there a participant is ineligible if all supporting documentation is not accurate or retained. Questioned Costs: None. Context: For two of sixty participant files, income was incorrectly calculated based on support in participant file. Statistical sampling was not used to test this compliance requirement. Identification as a repeat finding: This was finding 2019-001. Recommendation: The Authority should modify its internal control processes and increase the amount of second reviews performed to ensure participant files are complete, compliant and that assistance calculations are accurate and supported. Views of Responsible Officials: The Housing Choice Voucher (HCV) Manager will pull files on a sample basis and conduct a second review of the file. The HCV Manager will keep a tracking chart of all files audited along with the completed file audit checklists for later review.

Finding 2020-003 Significant Deficiency: Special Tests and Provisions - Control Finding CFDA 14.871 - Section 8 Housing Choice Vouchers Program Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirements: HUD requires that all families admitted to the program be selected from a waitlist (exception for special admission scenarios stated in 24 CFR section 982.203). The selection occurs when the Authority notifies a family whose name reaches the top of the waiting list to come in for eligibility verification (24 CFR sections 5.410, 982.54(d), and 982.201 through 982.207). Condition: In October 2020, the Authority implemented a new internal control process over monthly waitlists to ensure the lists were accurate and individuals were appropriately removed from the waitlist when housed or found to be ineligible. Cause: The Authority did not implement the internal control process until October 2020. Effect: The possibility exists that noncompliance with federal requirements could go undetected without proper controls over compliance relating to direct and material compliance requirements. Questioned Costs: None. Context: For four of seven monthly waitlists selected for testing, a second review was not documented during calendar year 2020. All exceptions occurred in months prior to October 2020. Identification as a repeat finding: Not applicable. Recommendation: The Authority has implemented an internal control related to monthly waitlist review. Second reviews should be timely and documented to ensure compliance with the requirements of federal grants. Views of Responsible Officials: Corrective Action plan already in place. This is no longer an issue.

Finding 2019-001 Significant Deficiency: Eligibility and Special Tests and Provisions - Compliance and Control Finding CFDA 14.871 - Section 8 Housing Choice Vouchers Program Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirements: 1. The PHA must determine that a participant is eligible through an income verification (24 CFR section 982.516) and calculation in accordance with 24 CFR part 5 subpart F. 2. The PHA must 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: Income was not correctly calculated based on the support provided in the file and annual recertification was not performed timely. Cause: The Authority has internal controls in place related to tenant file review whereby files are second reviewed on a sample basis due to the number of participants in the program. The participant files related to the two instances described below were not randomly selected for tenant file review. Effect: While tenants were found to be eligible for participation in both instances, a situation could arise there a tenant is ineligible if all supporting documentation is not accurate or retained. Questioned Costs: None. Context: For 2 of 60 participant files, income was incorrectly calculated based on support in tenant file. For 1 of 60 participant files, a recertification was not performed during calendar year 2019. Statistical sampling was not used to test this compliance requirement. Identification as a repeat finding: Not applicable. Recommendation: The Authority should modify its internal control processes and increase the amount of second reviews performed to ensure participant files are complete, compliant and that assistance calculations are accurate. Views of Responsible Officials: The Section 8 Housing Choice Voucher (HCV) Program Manager will track each month the status of annual recertifications to ensure recertifications are timely. In addition, the file review checklist will be modified to include an additional page for additional final review and income calculation. Documentation of these reviews will be maintained with the program tenants file.

Finding 2019-002 Control Deficiency: Allowable Costs, Reporting and Special Tests and Provisions - Control Finding CFDA 14.871 - Section 8 Housing Choice Vouchers Program Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: N/A - Direct Award Criteria Or Specific Requirement: HUD requires the Authority to electronically submit HUD-52681-B, Voucher for Payment of Annual Contributions and Operating Statement (OMB No. 2577-0169) on a monthly basis using the VMS system. Condition: Prior to July 2019, the Authority did not perform a review of information submitted monthly using the VMS system to ensure information was accurate and submitted timely. Cause: The Authority did not have an internal control process in place related to monthly VMS reporting prior to July 2019. Effect: The possibility exists that noncompliance with federal requirements could go undetected without proper controls over compliance relating to direct and material compliance requirements. Questioned Costs: Not Applicable Context: A second review was not documented for 2 of 3 monthly reports selected for testing during calendar year 2019; however, reports tested were found to be in compliance and submitted timely. Statistical sampling was not used to test this compliance requirement. Identification as a repeat finding: This was finding 2018-002. Recommendation: The Authority should implement an internal control related to monthly reporting. Second reviews should be timely and documented to ensure compliance with the requirements of federal grants. Views of Responsible Officials: Starting in August 2019, for monthly submissions, the Director of Finance will prepare the submissions and the Chief Executive Officer or Chief Operations Officer will review the reports submitted for completeness and timely submission.

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