QUALLA HOUSING AUTHORITYTribal Government

2019-001 14.867 HUD - IHBG; Criteria: 24 CFR 1000.128(a) - HUD Regulations require that the housing authority must verify that a tenant is income eligible to participate in this low-income housing program. 24 CFR 1000.128(b) - HUD Regulations provide that a housing authority may from time to time require tenant participants to verify annual income in order to determine housing payments and continued occupancy consistent with the housing authority?s policies. NAHASDA Statute Section 403(b) ? requires the housing authority perform on-site inspections of IHBG assisted stock to determine compliance with maintenance requirements; further the housing authority?s internal policy requires an annual inspection of each unit Condition: Tenant Eligibility Documentation ? Missing Information 15 of 40 files Didn?t have a current annual income recertification: 3 low rent, 10 mutual help, 2 home ownership units - a 38% exception rate 12 of 40 files Contained an inspection report that was more than 12 months old 3 low rent, 8 mutual help, 1 home ownership units - a 30% exception rate Effect: The Housing Authority is out of compliance with HUD regulations and the Housing Authority board approved policies. Questioned Costs: None identified Cause: Lack of effective tracking method to allow for follow up and lack of trained staffing available to perform inspections and recertification/rent determinations. Recommendation: Continue using a system of tracking status of tenant eligibility. Additionally, develop a system of self-review, by the department supervisor to conduct a periodic internal review during the year to ensure that the tenant file is complete and up to date and a system to follow up on missing items. Management response: Management agrees with finding.

2019-002 14.867 HUD - IHBG; Criteria: 2 CFR 200.302 ? Financial Management Regulations require that the Housing Authority should maintain records sufficient to allow the tracing of funds expended to a level of expenditures adequate to establish that such funds have been used according to Federal statutes, regulations, and the terms and conditions of the Federal award; including comparison of expenditures with budgeted amounts. NAHASDA Statute Section 404(b) ? requires the Housing Authority prepare a report to describe the use of grant amounts and assesses the relationship of such use to the planned activities identified in the IHP. Condition: The amounts reported as actual amounts expended in the Annual Performance Report (APR) are not supported by sufficient documentation in a manner that reported grant expenditures of planned activities identified in the IHP may be traced to the amounts reported as federal IHBG expenditures in the financial records. ? Amounts reported in the APR Section 5 Budgets used a mathematical ratio of amounts drawn to total amount of planned activity rather than specific identification of expenditures. Amounts reported for each of the categories: Modernization of 1937 Act Housing; Operation of 1937 Act Housing; and Operation and Maintenance of NAHASDA assisted units equates to precisely 66.87% of each planned activity being reported as accomplished. We note that the Housing Authority utilized procedures similar to those required in a loccs edit scenario such that each draw is supported by vendor invoice; general ledger coding; and payroll registers. However, the documents and general ledger transaction detail used to support the draws were not utilized to prepare the amounts reported for actual expenditures in the APR. Amounts drawn appear to be supported by routine expenditures that appear to be reasonable in amount and related to carrying out the duties required of grant performance. Effect: The Housing Authority is out of compliance with federal regulations and grant reporting requirements. Questioned Costs: None identified Cause: Staffing turnover ? current staff not familiar with preparation of APR and lack of effective general ledger coding. Recommendation: Consider attending HUD sponsored training on preparation of APR and utilizing a general ledger code that incorporates the IHP planned activities. Management response: Management agrees with finding.