THE HOUSING AUTHORITY OF THE CITY OF GREENWOOD, MISSISSIPPI

2025-001: Special Tests and Provisions Assistance Listing Number: 14.850a, Low Income Public Housing CONDITION AND CRITERIA: Housing Authorities are required under their Annual Contributions Contract (ACC) to have an updated General Depository Agreement in place with all financial institutions. All funds must be insured by a federal organization to safeguard against loss of said funds. Any portion of these funds not insured by FDIC must be fully collateralized with specific U.S. Government or Agency securities to prevent a loss of funds. TYPE OF FINDING: Significant Deficiency CAUSE: The Housing Authority experienced turnover in the Executive Director Position. Three different Executive Directors have been in place and changed over the last several years. Proper communication was not done in the internal control structure to allow compliance with HUD rules and regulations. EFFECT: The Housing Authority could not produce a current General Depository Agreement for their financial institutions. QUESTIONED COSTS: None known AUDITORS’ RECOMMENDATION: We recommend that the Housing Authority update its Declaration of Trust with the financial institutions that they do business with.

Assistance Listing No. 14.850a, Low Income Public Housing, Grant Period: Fiscal Year-End March 31, 2025 CRITERIA: The Davis-Bacon Act applies to contractors and subcontractors performing on federally funded or assisted contracts in excess of $2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works. Title 29 of the Code of Federal Regulations, Subtitle A, Part 5, Subpart A 5.5-A.3 Payrolls and Basic Records includes a requirement for the contractor or subcontractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). CONDITION AND PERSPECTIVE: The Authority’s Capital Fund Program funded one contract during fiscal year 2024 for which Davis Bacon Act requirements applied. The applicable contract began in May of 2023 and continued through the fiscal year ended March 31, 2024 into fiscal year 2025. The Authority was unable to provide copies of certified payrolls applicable to any weeks after September of 2023. QUESTIONED COSTS: None noted CAUSE: Failure to monitor active contracts to ensure compliance with federal Davis Bacon Act requirements. EFFECT: Non-compliance with the Davis-Bacon Act. CURRENT YEAR STATUS: The Housing Authority was unable to provide the certified payrolls for the construction contract that continued into fiscal year 2025. This is a repeat finding.

Non-compliance with the Davis-Bacon Act (Material Weakness, Material Non- Compliance) Capital Fund Program – Assistance Listing No. 14.872, Grant Period: Fiscal Year-End March 31, 2024 Criteria The Davis-Bacon Act applies to contractors and subcontractors performing on federally funded or assisted contracts in excess of $2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works. Title 29 of the Code of Federal Regulations, Subtitle A, Part 5, Subpart A 5.5-A.3 Payrolls and Basic Records includes a requirement for the contractor or subcontractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition and Perspective The Authority’s Capital Fund Program funded one contract during fiscal year 2024 for which Davis Bacon Act requirements applied. The applicable contract began in May of 2023 and continued through the fiscal year ended March 31, 2024 into fiscal year 2025. The Authority was unable to provide copies of certified payrolls applicable to any weeks after September of 2023. Questioned Costs – None noted Cause Failure to monitor active contracts to ensure compliance with federal Davis Bacon Act requirements. Effect Non-compliance with the Davis-Bacon Act. Recommendation We recommend that the Authority attain weekly certified payrolls from contractors as applicable for all federally funded contracts subject to the Davis-Bacon Act. Management’s Response The Authority will attain weekly certified payrolls from contractors as applicable for all federally funded contracts subject to the Davis-Bacon Act. The Authority’s Executive Director, Dr. Earl Hall, has assumed the responsibility of executing this corrective action as of July 1, 2025.

Excess Management Fees Charged to the Section 8 Housing Choice Voucher Program (Other Matter) Section 8 Housing Choice Voucher Program – Assistance Listing No. 14.871, Grant Period: Fiscal Year-End March 31, 2024 Criteria The Authority funds agency management, administrative and other indirect Section 8 Housing Choice Voucher Program (S8HCVP) costs by charging management and bookkeeping fees to the S8HCVP from its Central Office Cost Center (COCC). The Supplement to HUD Handbook 7475.1 specifies the management fee rate the Authority’s COCC may charge its S8HCVP at 20% of the administrative fee grant revenue recognized by the Program, or up to $12 per unit month per housing voucher leased, whichever is higher. Condition and Perspective During fiscal year 2024, the Authority’s COCC was permitted to charge management fees to its S8HCVP in the amount of $29,202 in accordance with the rate requirements stipulated in the Supplement to HUD Handbook 7475.1. However, the Authority’s COCC charged its S8HCVP $143,643, $114,441 above the allowable fee amount. Questioned Costs – $114,441 excess charge to the Program. Cause Incorrect fee rate applied to Program. Effect Non-compliance with HUD fee requirements specified in the Supplement to HUD Handbook 7475.1. Recommendation We recommend that the Authority limit fees charged to its Section 8 Housing Choice Voucher Program to the fees specified in the Supplement to HUD Handbook 7475.1. Management’s Response The Authority will limit fees charged to its Section 8 Housing Choice Voucher Program to the fees specified in the Supplement to HUD Handbook 7475.1. The Authority’s Executive Director, Dr. Earl Hall, has assumed the responsibility of executing this corrective action as of July 1, 2025.

Audited Financial Data Schedule Not Submitted Timely (Other Matter) Public Housing Program – Assistance Listing No. 14.850a, Section 8 Housing Choice Voucher Program – Assistance Listing No. 14.871, Emergency Housing Voucher Program – Assistance Listing No. 14.EHV, Capital Fund Program – Assistance Listing No. 14.872; Grant Period: Fiscal Year-End March 31, 2024 Criteria Title 24 of the Code of Federal Regulations, Subtitle B, Part 902, Subpart C 902.33 Financial Reporting Requirements includes a requirement for PHA’s to submit audited financial statements within 9 months of the end of applicable financial reporting periods (fiscal year-ends). The audit submission was due to HUD’s Real Estate Assessment Center (REAC) and the Federal Audit Clearinghouse (FAC) by December 31, 2024. Condition and Perspective The Authority did not submit its audited financial statements within 9 months of the end of its reporting period applicable to the fiscal year ended March 31, 2024. Questioned Costs – None noted Cause Personnel turnover within the PHA resulted in an audit delay. Effect Non-compliance with HUD’s audit reporting requirements. Recommendation We recommend that the Authority complete and submit its annual independent audit within 9 months of its future reporting periods. Management’s Response The Authority will complete and submit its annual independent audit within 9 months of its future reporting periods. The Authority’s Executive Director, Dr. Earl Hall, has assumed the responsibility of executing this corrective action no later than December 31, 2025.

Insufficient Collateralization of Deposits (Other Matter) Public Housing Program – Assistance Listing No. 14.850a, Grant Period: Fiscal Year-End March 31, 2024 Criteria HUD PIH Notice 96-33 requires Public Housing Authorities (PHA’s) to continuously and fully secure all bank deposits which exceed federally-insured balances. Condition and Perspective As of March 31, 2024, the Authority’s bank deposit balances were under-collateralized by $2,250,829. $1,086,927 of the under-collateralized balance consisted of deposits accounted for under the Authority’s non-federal ‘Business Activities’ Program. The remaining $1,163,902 of the under-collateralized balance consisted of deposits accounted for under the Public Housing Program. Questioned Costs – None noted Cause Failure to monitor security over bank deposits to ensure compliance with HUD PIH Notice 96-33. Effect Non-compliance with HUD PIH Notice 96-33. Recommendation We recommend that the Authority monitor security over bank deposits regularly. Management’s Response The Authority will monitor security over bank deposits regularly. The Authority’s Executive Director, Dr. Earl Hall, has assumed the responsibility of executing this corrective action as of July 1, 2025.