MARY LEE CHARLES PLACE

Finding 2023-02: Condition: The Organization did not use the Enterprise Income Verification (EIV) system, as required by HUD. We noted three tenant files did not contain a timely run EIV report. Criteria: Per 24 CFR 5.233 Mandated Use of HUD’s Enterprise Income Verification (EIV) System, entities administering assistance under Section 811 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013) must use HUD’s EIV system in its entirety as a third-party source to verify tenant employment and income information during mandatory reexaminations or recertifications of family composition and income. Cause: Inadequate monitoring of internal controls in place over use of EIV reports in initial certifications and recertifications noted during the current year. Effect: Failure to use the EIV system in its entirety may result in the imposition of sanctions and/or the assessment of disallowed costs associated with any resulting incorrect subsidy or tenant rent calculations, or both. Questioned costs: $-0- Context: We noted no timely run EIV reports in examination of three tenant files on two new tenants and one continuing tenant. Repeat Finding: Yes Recommendation: We recommend that the Organization require any personnel performing initial certifications or recertifications to undergo HUD 811 training regarding the intake process prior to performing any initial certifications or recertifications. Additionally, we recommend a second person in the housing office review the tenant file to ensure completeness and compliance with HUD 811 documentation requirements prior to signing the new/amended lease agreement. Reporting Views of Responsible Officials: Management agrees with the finding and will begin an independent review of each tenant file to include examination of EIV reports to determine if there are any discrepancies and take corrective measures. Leasing office staff will undergo additional HUD 811 training regarding the initial and recertification process. Additionally, management is staffing the property with a dedicated property manager that will be responsible for reviewing tenant files for compliance with HUD procedures including uses of EIV reports and ensure supporting documentation is maintained in each tenant’s file prior to signing new or amended leases.

Finding 2023-03: Condition: The Organization did not comply with the HUD requirement to obtain proof that tenant meets disability requirements for residency prior to admitting two applicants. Criteria: Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR section 891.505). Residents must also qualify as very low-income households to be eligible (42 USC 8013). Eligibility is only determined at move-in or at initial certification except in circumstances whereas family composition changes after initial occupancy a determination must be made as to whether the remaining member of the household will be eligible to receive assistance. Cause: Failure to follow internal control procedures during initial certifications of prospective tenants. Effect: Ineligible applicants were allowed to become tenants and receive assistance. Questioned costs: $1,924 Context: We noted no proof of qualifying disability in examination of two tenant files on two new tenants. Repeat Finding: No Recommendation: We recommend that the Organization require any personnel performing initial certifications or recertifications to undergo HUD 811 training regarding the intake process and program requirements prior to performing any initial certifications. Additionally, we recommend a second person in the housing office review each potential tenant’s file to ensure completeness and compliance with HUD 811 eligibility and documentation requirements prior to signing the new/amended lease agreement. Reporting Views of Responsible Officials: Management agrees with the finding and will begin an independent review of each tenant file to include examination of proof of disability paperwork to determine if there are any discrepancies and take corrective measures. Leasing office staff will undergo additional HUD 811 training regarding the initial and recertification process. Additionally, management is staffing the property with a dedicated property manager that will be responsible for reviewing tenant files for compliance with HUD procedures including eligibility requirements and ensure supporting documentation is maintained in each tenant’s file prior to signing new or amended leases. Management has requested proof of disability from the tenant that satisfies HUD guidelines and will not renew lease if it is not received.