Housing Authority of the City of Miami BeachLocal Government

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871/14.879 Federal Award Identification Number and Year: FL017 – 2024 Award Period: 7/1/2023-6/30/2024 Type of Finding: Significant Deficiency in Internal Control Over Compliance and Other Matters Criteria or Specific Requirement: Most PHAs devise their own application forms that are filled out by the PHA staff during an interview with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to obtain information from third parties; (b) a federally prescribed general release form for employment information; and (c) a privacy notice. Under some circumstances, other members of the family are required to sign these forms (24 CFR sections 5.212 and 5.230). The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). (2) 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 income-based rent (24 CFR section 982.516). (3) Determine income eligibility and calculate the tenant’s rent payment using the documentation from third-party verification in accordance with 24 CFR Part 5 Subpart F (24 CFR section 5.601 et seq.) (24 CFR sections 982.201, 982.515, and 982.516). (4) 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: During the testing of the Housing Choice Voucher Program tenant files, we noted two instances in which the Authority incorrectly calculated income for the recertification performed. Questioned costs: $365 Context: Out of 40 files, 2 files contained errors as noted above. Cause: The Authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations. Effect: Over- or underpayment to the landlord. Repeat finding: Yes. Finding number 2023-001. Recommendation: We recommend that the Authority review its quality control processes to ensure compliance with HUD rules and regulations. Also, we recommend that the Authority hold training for those involved in the eligibility process to ensure that the income reported on the HUD-50558 is supported with proper calculations. 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: 14.871/14.879 Federal Award Identification Number and Year: FL017 and 2022/2023 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or Specific Requirement: Most PHAs devise their own application forms that are filled out by the PHA staff during an interview with the tenant. The head of the household signs (a) one or more release forms to allow the PHA to obtain information from third parties; (b) a federally prescribed general release form for employment information; and (c) a privacy notice. Under some circumstances, other members of the family are required to sign these forms (24 CFR sections 5.212 and 5.230). The PHA must do the following: (1) As a condition of admission or continued occupancy, require the tenant and other family members to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). (2) 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 income-based rent (24 CFR section 982.516). (3) Determine income eligibility and calculate the tenant’s rent payment using the documentation from third party verification in accordance with 24 CFR Part 5 Subpart F (24 CFR section 5.601 et seq.) (24 CFR sections 982.201, 982.515, and 982.516). (4) 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: During the testing of the Housing Choice Voucher Program tenant files, one instance where the housing authority failed to process correct calculation using EIV information was noted as a deficiency. Questioned costs: $540 Context: Out of 40 files, 1 file contained errors as noted above. Cause: The Authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations, as well as their administrative policy. Effect: The Authority does not have adequate procedures in place to ensure that units income reported on the HUD-50058 is supported with proper calculations. Repeat finding: No Recommendation: We recommend that the Authority designate an individual to review tenant files to ensure that the income reported on the HUD-50058 is supported with proper calculations. 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: 14.871/14.879 Federal Award Identification Number and Year: FL017 and 2022/2023 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or Specific Requirement: 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 five percent 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) (24 CFR sections 982.4, 982.54(d)(15), 982.158(f)(7), and 982.507). Condition: Of the tenant files provided, auditor noted the following item: One instance where the housing authority could not provide copy of reasonable rent report for a rent increase. Questioned costs: N/A Context: Out of 40 files, 1 file contained errors as noted above. Cause: The Authority failed to provide adequate monitoring and oversight to ensure compliance with HUD rules and regulations, as well as their administrative policy. Effect: The Authority does not have adequate procedures in place to ensure that rent reasonableness is performed for rent increases Repeat finding: No Recommendation: We recommend that the Authority designate an individual to review tenant files to determine if a rent reasonableness has been performed. 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: 14.871/14.879 Federal Award Identification Number and Year: FL017 and 2021/2022 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. Condition: During our testing, we noted the Authority did not have adequate internal controls designed to ensure overpayments were not made to units that failed inspections. Context: During our testing of 40 files for failed inspection criteria, we noted the following: - One file tested was not properly abated after the unit failed the second inspection. The sample was a statistically valid sample. Questioned Costs: $15,677 Cause: The Authority experienced high level of staff turnover and staff absences due to the pandemic which resulted in this inspection not be conducted. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: No Recommendation: The Authority should review their process for monitoring failed inspections and ensuring that proper abatement occurs on a timely basis. View of Responsible Officials: There is no disagreement with this audit finding.

2019-001 Eligibility U.S. Department of HUD Housing Choice Voucher Cluster Other matter required to be reported in accordance with Uniform Guidance Condition: Out of a total tenant population of approximately 2,300; 44 files were tested and 6 files were found to have the following 4 deficiencies: ? Three files were missing a date on the 9886 form ? One file was missing a 214 form ? One file had an incorrect income calculation ? One file had an incorrect income deduction calculation for out of pocket medical expenses Context: The auditor randomly selected 44 tenants out of the population, which we consider to be a statistically valid sample size, for testing tenant files for eligibility. The auditor reviewed the tenant file and support to ensure controls over compliance were operating effectively. Criteria: The Authority?s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding complete and accurate tenant files. Cause: The Authority experienced a high turnover of housing specialists during the audited period. It was determined through the quality assurance process that employees whose performance was not in compliance with established internal policies and procedures had to be replaced. New staff members were being trained on the established policies and procedures during the audited period. Effect: The Authority identified certain areas of the HCV Program that were out of compliance with HUD requirements. Auditor?s Recommendations: The Authority should correct the deficiencies noted in the tested files and perform reviews of the remaining files, for consideration of similar errors. In addition, the Authority should establish quality control review procedures to ensure proper monitoring of compliance with the requirements related to tenant eligibility. View of Responsible Officials: See Corrective Action Plan.

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