Northwest Oregon Housing AuthorityLocal Government

Finding 2924-001 - Annual HQS Inspections Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 Award Period: 7/1/2023-6/30/2024 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matter Criteria or Specific Requirement: 24 CFR sections 982.158(d) and 982.405(b) state that the PHA must inspect the unit leased to a family at least bi-annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct qualify control re-inspections. The PHA must prepare a unit inspection report. Condition: During the testing of the Housing Choice Voucher Program tenant files for review of annual inspections, a deficiency was noted in one file. Context: During our testing of 60 files for HQS inspection criteria, we noted the following: - 1 of 60 files tested had an inspection that was not performed within the bi-annual period. Questioned Costs: Unable to determine. Cause: Prior to 2021, NOHA did not have written procedures in place for documenting inspections. NOHA applied the COVID waivers which allowed for more than 24 months in between inspections; and, NOHA attempted to acquire landlord self-certifications but in a small number of cases, did not receive the certification or it was not received by the due date. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes, prior year finding number was 2023-003 Recommendation: The Authority should review their HQS inspection policies to ensure that all inspections are performed timely, and that all necessary documentation is maintained for each inspection. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: Per 24 CFR section 982.516, 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 other income-based rent. 24 CFR section 982.516 states that 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 sections 5.212 and 5.230 states that the head of household must sign one or more release forms allowing the Authority to obtain information from third parties, as well as a federally prescribed general release form for employment information. Context: During our testing of 60 files for eligibility requirements, we noted the following in 5 files: - 1 of 60 files did not have proper support for income included on the HUD-50058. - 4 of 60 files did not have proper support for assets included on the HUD-50058. - 1 of 60 files tested did not have properly calculated HAP/TAP due to incorrect income and assets support. Questioned Costs: $60 Cause: The failure to update the 50058 regarding immaterial asset amounts (no effect on HAP/TTP) was a data entry error. The one file where COLA was calculated incorrectly is not a systemic issue. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their processes for eligibility determination and documentation to ensure all information is properly documented and maintained in the files. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program Assistance Listing Number: 14.871 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: 24 CFR sections 5.410, 982.54(d), and 982.201 through 982.207 state that all families admitted to the program must be selected from the waiting list. “Selection” from the waiting list generally occurs when the PHA notifies a family whose name reaches the top of the waiting list to come in to verify eligibility for admission. Context: During our testing of 60 files for wait list criteria, we noted the following: - 2 individual did not have their original application in the file. Questioned Costs: Unable to determine. Cause: The Authority lacked protocols to properly document the application date with the electronic wait list data entry prior to 2021. The applicants who reached the top of the wait list in 2023 applied with the Authority in mid-2019. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their policies to ensure all required documentation is maintained for all individuals who are on the waiting list. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 Award Period: 7/1/22-6/30/23 Type of Finding: Material Weakness in Internal Control Over Compliance Criteria: 24 CFR sections 982.158(d) and 982.405(b) state that the PHA must inspect the unit leased to a family at least bi-annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct qualify control re-inspections. The PHA must prepare a unit inspection report. Context: During our testing of 60 files for HQS inspection criteria, we noted the following: - 10 of 60 files tested had an inspection that was not performed within the bi-annual period. - 3 of 60 files tested utilized self-certification forms past the allowable time frame. Questioned Costs: Unable to determine. Cause: Prior to 2021, NOHA did not have written procedures in place for documenting inspections. NOHA applied the COVID waivers which allowed for more than 24 months in between inspections; and, NOHA attempted to acquire landlord self-certifications but in a small number of cases, did not receive the certification or it was not received by the due date. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their HQS inspection policies to ensure that all inspections are performed timely, and that all necessary documentation is maintained for each inspection. View of Responsible Officials: There is no disagreement with this audit finding.

Finding 2022-001 ? Eligibility Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program Assistance Listing Number: 14.871 Award Period: 7/1/21-6/30/22 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: 24 CFR section 982.516, 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 other income-based rent. 24 CFR section 982.516 states that 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 sections 5.212 and 5.230 states that the head of household must sign one or more release forms allowing the Authority to obtain information from third parties, as well as a federally prescribed general release form for employment information. Context: During our testing of 60 files for eligibility requirements, we noted the following: - 1 files did not have a signed Declaration 214 form for all members of the household - 4 files did not have proper support for income - 2 files did not have proper support for assets - 2 files did not have proper support for expenses - In total, 6 files did not have properly calculated HAP/TAP due to incorrect income, asset and/or expense support - 1 file did not have a signed HUD-9886 form in the file - 3 files did not have a signed general release form in the file - 1 file did not have a signed HAP contract in the file Questioned Costs: Unable to determine. Cause: The Authority?s current staff attempted to correct prior documentation errors during the period, but were not able in all cases, to obtain some missing information. In addition, in a few cases, the Authority experienced difficulty in obtaining some information during the period which occurred during COVID. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their processes for eligibility determination and documentation to ensure all information is properly documented and maintained in the files. View of Responsible Officials: There is no disagreement with this audit finding.

Finding 2022-002 ? Waitlist Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program Assistance Listing Number: 14.871 Award Period: 7/1/21-6/30/22 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: 24 CFR sections 5.410, 982.54(d), and 982.201 through 982.207 state that all families admitted to the program must be selected from the waiting list. "Selection" from the waiting list generally occurs when the PHA notifies a family whose name reaches the top of the waiting list to come in to verify eligibility for admission. Context: During our testing of 73 files for wait list criteria, we noted the following: - 1 file did not have the original application in the tenant file - 21 files tested had an application date that did not agree to the application date listed on the waiting list - 1 file tested had a voucher that was not signed Questioned Costs: Unable to determine. Cause: The Authority lacked protocols to properly document the application date with the electronic wait list data entry prior to 2021. The applicants who reached the top of the wait list in 2022 applied with the Authority between 2017 and 2019. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their policies to ensure all required documentation is maintained for all individuals who are on the waiting list. View of Responsible Officials: There is no disagreement with this audit finding.

Finding 2022-003 ? Annual HQS Inspections Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program Assistance Listing Number: 14.871 Award Period: 7/1/21-6/30/22 Type of Finding: Material Weakness in Internal Control Over Compliance Criteria: 24 CFR sections 982.158(d) and 982.405(b) state that the PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct qualify control re-inspections. The PHA must prepare a unit inspection report. Context: During our testing of 60 files for HQS inspection criteria, we noted the following: - 20 of 60 files tested had an inspection that was not performed timely. Questioned Costs: Unable to determine. Cause: The Authority did not have written procedures in place prior to 2021 for documenting inspections. Support was often not available for prior period inspections and/or inspections were not completed timely. The Authority experienced challenges during COVID in completing inspections timely. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their HQS inspection policies to ensure that all inspections are performed timely and that all necessary documentation is maintained for each inspection. View of Responsible Officials: There is no disagreement with this audit finding.

Finding 2022-004 ? Failed Inspections Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program Assistance Listing Number: 14.871 Award Period: 7/1/21-6/30/22 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: 24 CFR sections 982.158(d) and 982.404 state that for units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS Deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HAQ deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family's failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations. Context: During our testing of 60 files for failed inspection criteria, we noted the following: - 4 files tested had repairs that were not completed timely. Questioned Costs: Unable to determine. Cause: The Authority conducted 995 annual/biennial inspections during the audit period in an effort to correct timeliness of annual inspections. Though inspection results monitoring was in place, in some instances, the Authority did not follow up timely on failed inspection results. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: No Recommendation: The Authority should review their HQS inspection policies to ensure that all repairs are made timely and if not, that the necessary actions are taken by the Authority. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program CFDA Number: 14.871 Award Period: 7/1/20-6/30/21 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507 state that the PHA must determine that the rent to owner is reasonable at the time of initial leasing. Also, the PHA must determine reasonable rent during the term of the contract (a) before any increase in the rent to owner, and (b) at the HAP contract anniversary if there is a 5% decrease in the published fair market rent in effect 60 days before the HAP Contract anniversary. The PHA must maintain records to document the basis for the determination that rent to owner is a reasonable rent (initially and during the term of the HAP contract). Context: During our testing of 49 files for rent reasonableness, we noted the following: - 17 files had rent that was determined to be reasonable after the effective date. - 1 file had a rent comparison form that was not signed/dated by the housing specialist. Questioned Costs: Unable to determine. Cause: The Authority had significant turnover in the personnel responsible for the reasonable rent determination. The lack of consistency in the tenant file documentation and the lack of proper management oversight of the personnel made it difficult for current personnel to provide the necessary documentation. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their processes for reasonable rent determination to ensure that it is determined timely and that all documentation is fully completed. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program CFDA Number: 14.871 Award Period: 7/1/20-6/30/21 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 24 CFR sections 5.410, 982.54(d), and 982.201 through 982.207 state that all families admitted to the program must be selected from the waiting list. "Selection" from the waiting list generally occurs when the PHA notifies a family whose name reaches the top of the waiting list to come in to verify eligibility for admission. Context: During our testing of 49 files for wait list criteria, we noted the following: - 5 of 49 files did not have their original application in the tenant file - 2 of 49 files tested did not have a letter in the file indicating their name had reached the top of the waiting list. -1 of 49 files tested had an application date that did not agree to the application date listed on the waiting list -1 of 49 files could not be tested because the support could not be located. Questioned Costs: Unable to determine. Cause: The Authority had significant turnover in the personnel responsible for maintaining the waiting list. The lack of consistency in the tenant file documentation and the lack of proper management oversight of the personnel made it difficult for current personnel to provide the necessary documentation. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their policies to ensure all required documentation is maintained for all individuals who are on the waiting list. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program CFDA Number: 14.871 Award Period: 7/1/20-6/30/21 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 24 CFR sections 982.158(d) and 982.405(b) state that the PHA must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the PHA must conduct qualify control re-inspections. The PHA must prepare a unit inspection report. Context: During our testing of 40 files for HQS inspection criteria, we noted the following: - 26 of 40 files tested did not have complete documentation of the HQS inspection in the file. - 20 of 40 files tested had an inspection that was not performed timely. - 30 of 40 files tested did not include a letter to the landlord and tenant notifying the outcome of the inspection. - 26 of 40 files tested had an inspection report that was not signed. Questioned Costs: Unable to determine. Cause: The Authority had significant turnover in the personnel responsible for HQS inspections. The lack of consistency in the tenant file documentation and the lack of proper management oversight of the personnel made it difficult for current personnel to provide the necessary documentation. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their HQS inspection policies to ensure that all inspections are performed timely and that all necessary documentation is maintained for each inspection. View of Responsible Officials: There is no disagreement with this audit finding.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Choice Voucher Program CFDA Number: 14.871 Award Period: 7/1/20-6/30/21 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 24 CFR sections 982.158(d) and 982.404 state that for units under HAP contract that fail to meet HQS, the PHA must require the owner to correct any life threatening HQS Deficiencies within 24 hours after the inspections and all other HQS deficiencies within 30 calendar days or within a specified PHA-approved extension. If the owner does not correct the cited HAQ deficiencies within the specified correction period, the PHA must stop (abate) HAPs beginning no later than the first of the month following the specified correction period or must terminate the HAP contract. The owner is not responsible for a breach of HQS as a result of the family's failure to pay for utilities for which the family is responsible under the lease or for tenant damage. For family-caused defects, if the family does not correct the cited HQS deficiencies within the specified correction period, the PHA must take prompt and vigorous action to enforce the family obligations. Context: During our testing of five files for failed inspection criteria, we noted the following: - Two of five files tested had repairs that were not completed timely. Questioned Costs: Unable to determine. Cause: The Authority had significant turnover in the personnel responsible for HQS inspections. The lack of consistency in the tenant file documentation and the lack of proper management oversight of the personnel made it difficult for current personnel to provide the necessary documentation. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: No Recommendation: The Authority should review their HQS inspection policies to ensure that all repairs are made timely and if not, that the necessary actions are taken by the Authority. View of Responsible Officials: There is no disagreement with this audit finding.

Criteria: The Uniform Guidance requires the Housing Authority to maintain proper documentation demonstrating compliance with the program?s eligibility, reporting and special test requirements.Condition: The Housing Authority could not provide the necessary eligibility documentation as follows: HAP Contract - 7 of the 25 tenant files selected did not contain a signed HAP contract. Income Verification - 8 of the 25 tenant files selected had missing or incomplete documentation of tenant?s income used in the HAP payment calculation. The Housing Authority could not provide the necessary special test documentation as follows: Reasonable rents - 16 of the 25 tenant files selected did not contain a reasonable rent analysis for the current HAP payment calculation. HQS Enforcement - 5 of the 25 tenant files selected did not contain documentation of the required biennial housing quality inspection. HQS Enforcement ? 14 of the 25 selected failed HQS inspections did not have documentation of the subsequent passed inspection. Waiting List ? 7 of the 25 selected did not have documentation showing the participant reached the top of the list per the Housing Authority?s criteria. The Housing Authority could not provide the necessary reporting documentation as follows: VMS ? the Housing Authority was able to provide the monthly VMS reports but did not have documentation to support the financial and tenant information submitted in the reports. Unaudited REAC ? the Housing Authority had not completed the unaudited REAC submission for the fiscal year ended June 30, 2020 as of January 2021. Cause: The Housing Authority had significant turnover in the personnel responsible for determining eligibility documentation. The lack of consistency in tenant file documentation and the lack of proper management oversight of the personnel made it difficult for current personnel to provide the necessary documentation. Questioned Costs: The HAP payments on behalf of these participants is estimated at $77,122 or 54% of the HAP payments tested and could be disallowed by the funding agency. Total HAP expenditures for the fiscal year totaled $7.2 million. Identification of Repeat Finding: This is not a repeat finding from the prior fiscal year.

Criteria: The Uniform Guidance requires the Housing Authority to maintain proper documentation demonstrating compliance with the program?s allowable activities and cost requirements. Condition: The Housing Authority could not provide the adequate supporting documentation for 4 of the 40 selected vendor payments. Cause: The Housing Authority had significant turnover in their accounting personnel. This caused inconsistency with the personnel performing the finance activities including filing of the financial records. The current financial personnel could not locate the requested vendor invoices. Effect: Total disbursements for the 4 missing vendor invoices totaled $782 (4%) of the total selections of $19,504. This amount does not exceed the $25,000 questioned cost threshold when projected to the total administrative expenses for the fiscal year. Identification of Repeat Finding: This is not a repeat finding from the prior fiscal year.

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