oversight

The Richmond Redevelopment and Housing Authority, Richmond, Virginia, Did Not Effectively Operate Its Housing Choice Voucher Program

Published by the Department of Housing and Urban Development, Office of Inspector General on 2008-04-15.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                                                 Issue Date
                                                                     April 15, 2008
                                                                 Audit Report Number
                                                                     2008-PH-1006




TO:        William D. Tamburrino, Director, Baltimore Public Housing Program Hub,
            3BPH


FROM:      John P. Buck, Regional Inspector General for Audit, Philadelphia Regional
            Office, 3AGA

SUBJECT:   The Richmond Redevelopment and Housing Authority, Richmond, Virginia,
            Did Not Effectively Operate Its Housing Choice Voucher Program

                                  HIGHLIGHTS

 What We Audited and Why

           We audited the Richmond Redevelopment and Housing Authority’s (Authority)
           Section 8 Housing Choice Voucher program (program). We selected the
           Authority based upon our analysis of various risk factors relating to the housing
           authorities under the jurisdiction of HUD’s Baltimore field office. This is the first
           of three audit reports to be issued on the Authority’s program. The audit
           objectives addressed in this report were to determine whether the Authority
           adequately managed its waiting list, met HUD’s lease-up thresholds, and operated
           it’s Family Self-Sufficiency program according to HUD requirements.

 What We Found


           Despite having sufficient funds to house eligible participants, the Authority’s
           Housing Choice Voucher program was significantly underleased. The Authority
           also awarded 51 vouchers to families without documenting how they were
           selected. The Authority's failure to meet HUD's lease-up thresholds resulted in
           approximately 674 families, in fiscal year 2007, not being housed even though the
           Authority had $7.6 million in excess program funds. The underutilization
           occurred because the Authority did not comply with HUD requirements and its
           own administrative plan, did not properly utilize a waiting list containing over
           8,000 families, and experienced significant turnover at both the staff and
           management level. The Authority’s failure to give housing opportunities as
           required by federal regulations and its annual contributions contract with HUD,
           due to its improper utilization of the waiting list, effectively denied families the
           opportunity to obtain low-income housing.

           The Authority failed to operate its Family Self-Sufficiency program according to
           the United States Code, HUD requirements, and its Family Self-Sufficiency
           action plan. This occurred because the Authority failed to exercise proper
           supervision and oversight of its Family Self-Sufficiency program and lacked
           adequate procedures and controls to ensure that federal requirements were
           appropriately met. As a result, it inappropriately paid $68,183 to program
           participants when it could not be determined in the files that the participants had
           successfully completed their goals, and $15,826 to participants who did not
           provide written requests for extension of their contracts.

What We Recommend

           We recommend that the Director of HUD’s Baltimore Public Housing Program
           Hub require the Authority to implement adequate controls and procedures to
           house as many eligible participants as possible, thereby using approximately $3.4
           million more in program funds to house more families. We also recommend that
           the Authority provide support or reimburse its program $346,432 from nonfederal
           funds for the unsupported housing assistance payments, reimburse its Family
           Self-Sufficiency program $84,009 from nonfederal funds for its improper use of
           contract and program funds, and implement adequate procedures and controls to
           address the findings cited in this audit report.

Auditee’s Response


           We provided the draft report to the Authority on March 19, 2008, and discussed it
           with them at an exit conference on April 2, 2008. The Authority provided written
           comments to our draft report on April 7, 2008. The Authority generally agreed
           with the findings and recommendations.

           The complete text of the Authority’s response, along with our evaluation of that
           response, can be found in appendix B of this report.




                                              2
                            TABLE OF CONTENTS

Background and Objectives                                                              4

Results of Audit
      Finding 1: The Authority Significantly Underleased Its Section 8 Housing         5
      Choice Voucher Program
      Finding 2: The Authority Failed to Operate Its Family Self-Sufficiency Program   9
      in Accordance with Federal Requirements

Scope and Methodology                                                                  13

Internal Controls                                                                      15

Appendixes
   A. Schedule of Questioned Costs and Funds to Be Put to Better Use                   17
   B. Auditee Comments and OIG’s Evaluation                                            18
   C. Criteria                                                                         23




                                             3
                     BACKGROUND AND OBJECTIVES

The Richmond Redevelopment and Housing Authority (Authority) was established in 1940 to
provide and preserve quality affordable housing and promote self-sufficiency, homeownership,
and independence for all housing residents. A seven-member board of commissioners governs
the Authority. The Authority’s executive director is Anthony Scott. Its main administrative
office is located at 901 Chamberlayne Parkway in Richmond, Virginia.

The Authority administers approximately 3,147 housing choice vouchers under consolidated
annual contributions contracts with the U.S. Department of Housing and Urban Development
(HUD). The consolidated annual contributions contract defines the terms and conditions under
which the Authority agrees to develop and operate all projects under the agreement. HUD
authorized the Authority $34.1 million in financial assistance from fiscal years 2006 to 2007 to
provide housing assistance through its Section 8 Housing Choice Voucher program.

The audit objective addressed in this report was to determine whether the Authority fully used
program funds according to federal requirements.




                                                4
                                 RESULTS OF AUDIT

Finding 1: The Authority Significantly Underleased Its Section 8
Housing Choice Voucher Program
Despite having sufficient funds available to house eligible participants, the Authority’s Section 8
Housing Choice Voucher program was significantly underleased. The Authority also awarded
51 vouchers to families without documenting how they were selected. These conditions
occurred because the Authority did not comply with HUD requirements and its own
administrative plan, did not properly update and use its waiting list of more than 8,000 families,
and experienced significant turnover at both the staff and management level. The Authority's
failure to meet HUD's lease-up thresholds resulted in approximately 674 families in fiscal year
2007, and 480 families in fiscal year 2006, not being housed. In addition, by not meeting the
lease-up requirements and selecting properly from the waiting list, applicants wait excessive
amounts of time to obtain housing.



 The Section 8 Voucher Lease-
 up Threshold Was Not Met


               24 CFR [Code of Federal Regulations] 985.3(n)(3)(ii) requires that public
               housing authorities lease at least 95 percent of their allocated yearly vouchers to
               eligible participants. HUD uses this requirement as part of its review and scoring
               of the Authority’s Section 8 program. The audit showed that the Authority's
               failure to meet HUD's lease-up thresholds resulted in approximately 674 families,
               in fiscal year 2007, and 480 families in fiscal year 2006, not being housed.

               The table below illustrates how the Authority has failed to meet HUD’s expected
               yearly voucher lease-up threshold.

    Fiscal       Total        Average      Authority’s   95% of   Additional Additional
     year        HUD            units      utilization    units     units      units
                 units         leased         rate     contracted needed to needed to
               contracted                                         meet 95%     meet
                                                                               100%
     2007         3,147         2,473         79%         2,990      517        674
     2006         3,112         2,632         85%         2,956      324        480




                                                 5
Unused Section 8 Funds Totaled
More Than $7.6 Million


            The Authority’s Housing Choice Voucher program excess fund account showed
            that as of January 31, 2008, it had accumulated over $4.7 million in excess
            Section 8 Housing Choice Voucher program funds and related interest. The
            Authority accumulated these funds in an interest-bearing account in accordance
            with HUD guidance which requires that any budget authority provided to the
            Authority that exceeds actual program expenses for the same period must be
            maintained in an undesignated fund balance account in accordance with Generally
            Accepted Accounting Principles. The Authority stated that the funds in this
            account were the cumulative excess funds received from HUD that were not used
            for its Housing Choice Voucher Tenant-Based program as of the end of fiscal
            year 2006.

            At the time of our audit, the Authority had not yet calculated and placed its fiscal
            year 2007 excess funds in its interest-bearing account as required by HUD
            guidance. Therefore, we calculated the amount of excess Section 8 Housing
            Choice Voucher program funds for fiscal year 2007 using the Authority’s
            Voucher Management System data and HUD’s Section 8 Management
            Assessment program information. We determined that the Authority had
            accumulated another $2.9 million in excess program funds during fiscal year
            2007. Overall, the Authority’s Section 8 Housing Choice Voucher excess
            program funds totaled more than $7.6 million. Since it would have cost the
            Authority about $7.5 million (1,154 unused vouchers in 2006 and 2007 times
            $6,459 and $6,502, respectively, average voucher cost) to provide the required
            number of vouchers, the Authority had sufficient funds to fund those vouchers.

The Authority Failed to Issue
Vouchers from Its Waiting List


            The Authority did not comply with HUD regulations and its Housing Choice
            Voucher program administrative plan when it failed to select program participants
            from its waiting list. The Authority acknowledged that it did not issue vouchers
            from its waiting list which contained more than 8,000 families. Further, it had
            issued only 111 vouchers since May 2003. Of the 111 vouchers issued

               •   60 families were ported in from other housing authorities and were
                   absorbed into the Authority’s program, and

               •   51 families were awarded vouchers without documentation identifying
                   how they were selected.

                                              6
          The Authority’s executive director told us the Authority did not issue vouchers
          from its waiting list because the list was significantly inaccurate and out-of-date.
          It did not update and purge its waiting list which caused the list to be outdated and
          therefore of limited value to the Authority. However, according to 24 CFR [Code
          of Federal Regulations] 982.204, a housing authority is required to select
          participants from its waiting list in accordance with its administrative plan, and its
          administrative plan should state when applicants are to be removed from the
          waiting list. The Authority’s administrative plan required it to select from the
          waiting list and to update and purge the list at least every two years to ensure that
          only interested families were listed.

          The Authority’s actions resulted in $346,432 in unsupported housing assistance
          payments on behalf of 51 families to whom it awarded vouchers without
          documenting how it selected them. The Authority needs to follow HUD
          regulations and its own administrative plan to ensure that it properly issues
          vouchers from its waiting list and that it establishes a clear audit trail showing
          how it selects program participants to ensure fairness and consistency.

Problems Acknowledged


          The Authority acknowledged the problems associated with its administration of
          the Section 8 Housing Choice Voucher program. In this regard, the Authority
          submitted a Corrective Action Plan to HUD on December 21, 2007, and had
          begun working to correct the problems discussed in this finding. The Authority
          attributed the problems to several issues. The Authority’s executive director told
          us that the Authority did not issue vouchers from its waiting list because the list
          was significantly inaccurate and out-of-date. The executive director stated that he
          is now attempting to ensure that the list is updated and purged so that it can be
          used. Authority officials also attributed much of the problem to the fact that the
          Authority has experienced significant turnover of personnel from June 2005
          through June 2007. The loss of 15 employees included key personnel such as the
          deputy executive director of affordable housing, assistant director of assisted
          housing, assisted housing supervisor, and eight assisted housing specialists. The
          Authority also attributed many of the problems to former managers lacking HUD
          program knowledge, and poorly trained specialists not knowing what to do with
          the waiting list or how to use HUD data to monitor the Authority’s progress.
          Thus, the Authority was unable to properly ensure that its Housing Choice
          Voucher program complied with HUD requirements. Further, the Authority
          lacked a formal training plan to identify needed training and provide employees
          with current and adequate training and it lacked a formal landlord outreach
          program.




                                            7
Conclusion


             The Authority had a low unit utilization rate keeping approximately 674 families,
             in fiscal year 2007, from not being housed even though the Authority had $7.6
             million in excess program funds. In addition, not selecting applicants properly
             from the waiting list caused families to wait longer than necessary to receive
             vouchers. By implementing controls and procedures to fully utilize all vouchers,
             the Authority will spend approximately $3.4 million more of its funding on
             housing families in the next year. Our methodology for this calculation is in the
             Scope and Methodology section of this report.

Recommendations



             We recommend that the Director of HUD’s Baltimore Public Housing Program
             Hub require the Authority to

             1A.    Implement adequate controls and procedures to ensure that housing choice
                    vouchers are fully used to provide housing to the maximum number of
                    eligible participants, thereby putting approximately $3.4 million in
                    program funds to better use.

             1B.    Provide supporting documentation or reimburse its program $346,432 for
                    the unsupported housing assistance payments related to the 51 tenants
                    cited in this finding.

             1C.    Ensure its program waiting list is purged, updated and used according to
                    HUD regulations and its administrative plan.

             1D.    Establish a clear audit trail showing how it selects program participants to
                    ensure fairness and consistency.

             1E.    Develop a formal training plan to identify needed training and provide
                    employees with current and adequate training.

             1F.    Develop a landlord outreach program to keep current landlords informed
                    of program changes and to encourage new landlords into the program.




                                              8
Finding 2: The Authority Failed to Operate Its Family Self-Sufficiency
Program in Accordance with Federal Requirements
The Authority failed to ensure that participants completed required forms, sought and maintained
suitable employment, and properly requested extending their contracts. It also failed to ensure
that participants met interim and final goals before issuing escrow payments. As a result, it
inappropriately paid $68,183 to program participants when it could not be determined in the files
that the participants had successfully completed their goals, and $15,826 to participants who did
not provide written requests for extension of their contracts. This condition occurred because the
Authority did not exercise proper supervision and oversight of its Family Self-Sufficiency
program and lacked adequate procedures and controls to ensure that federal requirements were
met. The Authority’s failure to maintain sufficient documentation made it difficult to determine
whether the Family Self-Sufficiency program met its goal of enabling households to become
economically self-sufficient, increased the likelihood of inappropriate households receiving
payments, and reduced its ability to monitor and measure the effectiveness of the Family Self-
Sufficiency program.



 Participation Was Not in
 Accordance with Requirements


               We requested 100 percent of the active files for current participants in the Family
               Self-Sufficiency program. The Authority was only able to provide 100 of the 103
               files requested. Three files could not be located. Of the 100 participant files, 65
               files contained one or more of the following discrepancies:

                  •   45 files did not include a goal of finding and maintaining employment,
                  •   17 files did not contain a Family Self-Sufficiency notification of escrow
                      funds,
                  •   5 files had the contracts extended without a written request,
                  •   2 files did not contain case management assessment summaries, and
                  •   2 files did not contain initial applications.

               The Authority should work with the 45 participants who did not include a goal of
               finding and maintaining suitable employment to modify those Individual Training
               and Service Plans.




                                                9
The Authority Improperly Paid
$68,183 in Final Escrow
Payments


           We reviewed 100 percent of the files for participants that had completed the
           Family Self-Sufficiency program between September 2005 and April 2007. The
           Authority provided 20 of the 21 files. One file could not be located. Of the 20
           participant files, 18 files were missing one or more of the following required
           documents:

              •   14 files did not contain adequate documentation showing that the
                  participants met the goals of the program or include a final goal of finding
                  suitable employment,
              •   12 files did not contain annual notification of escrow,
              •   5 files did not contain an initial application,
              •   3 files did not contain family assessments, and
              •   1 file did not contain a contract of participation.

           The Authority funds this program through its Housing Choice Voucher program by
           establishing an interest-bearing escrow account for each participating family. It
           credits the escrow credit, based on increases in earned income of the family, during
           the term of the contract. It may make a portion of this escrow account available to
           the family during the term of the contract to enable the family to complete an interim
           goal such as education. If the family completes the contract and no member of the
           family is receiving cash welfare assistance, the amount of the account can be paid to
           the head of the family. If the Authority terminates the contract or if the family fails
           to complete the contract before its expiration, the family escrow funds should be
           forfeited. The objectives of the program include encouraging and supporting
           families to become self-sufficient and providing ongoing evaluation to address
           program effectiveness. The Authority improperly paid $68,183 to 14 program
           participants without documenting that the participants had successfully completed
           their goals. A detailed description of the specific criteria governing the program is
           in appendix C.

The Authority Improperly Paid
$15,826 in Interim Escrow
Payments


           Regulations at 24 CFR [Code of Federal Regulations] 984.303(d) require the
           Authority to extend the term of the contract of participation for a period not to
           exceed two years only when the family requests in writing an extension of the
           contract, provided that the Authority finds good cause exists for granting the
           extension. The family’s written request for an extension must include a
           description of the need for the extension. “Good cause” is defined as
                                             10
             circumstances beyond the control of the family, as determined by the Authority,
             such as a serious illness or involuntary loss of employment. Extension of the
             contract of participation may entitle the family to continue to have amounts
             credited to its escrow account. The Authority extended the contracts of five
             participants without a written request as required. Without the written request for
             extension, there is no support for the extension and the additional $15,826
             escrowed from the date of the initial completion date.

The Authority Lacked
Adequate Procedures and
Controls


             The Authority failed to exercise proper supervision and oversight of its Family
             Self-Sufficiency program and lacked adequate procedures and controls to ensure
             federal requirements were appropriately met. The Authority’s deputy executive
             director of affordable housing and the internal auditor attributed many of the
             problems with the program to former managers that lacked HUD program
             knowledge. The completed and active contracts of participation reviewed were
             awarded under a previous Family Self-Sufficiency coordinator.


Conclusion

             The Authority improperly paid $84,009 in interim and final escrow payments.
             The Authority’s failure to maintain sufficient documentation made it difficult to
             determine whether the Family Self-Sufficiency program met its goal of enabling
             households to become economically self-sufficient and increased the likelihood of
             inappropriate households receiving payments. It also reduced the Authority’s
             ability to monitor and measure the effectiveness of the Family Self-Sufficiency
             program.

Recommendations

             We recommend that the Director of HUD’s Baltimore Public Housing Program
             Hub require the Authority to

             2A.    Reimburse its program $84,009 from nonfederal funds ($68,183 for
                    interim and final escrow payments made to tenants whose files did not
                    contain adequate documentation showing that they met goals of the
                    program, and $15,826 for tenants who did not submit written
                    documentation for extending contracts).

             2B.    Implement procedures and controls over its Family Self-Sufficiency
                    program to ensure that it follows federal requirements.
                                              11
2C.   Work with the current Family Self-Sufficiency participants to modify
      those individual training and service plans that did not include the goal of
      finding and maintaining suitable employment.




                               12
                         SCOPE AND METHODOLOGY

We performed the audit from June 2007 through January 2008 at the Authority located in
Richmond, Virginia. The audit was performed in accordance with generally accepted
government auditing standards.

The audit covered transactions representative of operations current at the time of the audit and
included the period June 2005 through September 2007. We expanded the scope of the audit as
necessary. We reviewed applicable regulations and guidance and discussed operations with
management and staff personnel at the Authority.

To determine whether the Authority carried out its operations in accordance with applicable
HUD requirements, we reviewed

   •   Applicable laws; regulations; the Authority’s program administrative plan, effective July 1,
       2005; HUD program requirements at 24 CFR [Code of Federal Regulations] Parts 5, 35,
       982, 984, and 985; HUD’s Housing Choice Voucher Guidebook 7420.10g and PIH Notice
       2005-09.

   •   The Authority’s accounting records, annual audited financial statements for 2005 and 2006,
       general ledgers, checks, tenant files, computerized databases, policies and procedures, board
       meeting minutes since September 2005, organizational chart, and program annual
       contributions contract.

   •   HUD’s files for the Authority.

During the audit we assessed the reliability of computer-processed data relevant to our audit by
comparing the data to hard-copy information. We found the computer-processed data were
sufficiently reliable to meet our audit objectives.

Using Audit Command Language software from information contained in the Authority’s
database we determined that the Authority issued 238 vouchers since May 2003. Of the 238
vouchers issued, 111 were issued for the Housing Choice Voucher Tenant-Based Section 8
program. Of the 111 vouchers, 51 vouchers were issued for unsupported reasons, and 59 were
absorption of families porting in from other housing authorities.

We determined that the Authority will spend approximately $3.4 million more of its funding on
housing families in the next year. We calculated this by multiplying the average annual voucher
payment in 2007 by the projected number of underutilized vouchers in the next year. The annual
average housing assistance payment per unit was determined by taking the voucher management
system expenses for fiscal year 2007 which were $16,081,200, and dividing by the average
number of housing choice voucher units for fiscal year 2007 of 2,473, giving an average annual
voucher payment of $6,502 for fiscal year 2007. We consider this a conservative number since
we expect the cost of issuing vouchers to increase. We used the number of underutilized

                                                13
vouchers for 2007 and consider this conservative since the problem seemed to be getting worse
each year. We expect the number to be greater than the 517 vouchers needed to meet the 95
percent of authorized vouchers since the leased rate decreased between 2006 and 2007 by 5
percent. We calculated 517 vouchers in 2007 by taking the difference between 95 percent of its
3,147 contracted vouchers (2,990) and the 2,473 average number of vouchers leased in 2007.
Therefore, we estimate that the Authority will have $3,361,534 in excess program funds that will
be used in the coming year if the Authority implements controls and procedures to increase its
utilization rate to 95 percent. This estimate is solely to demonstrate the annual amount of
program funds that could be put to better use if the Authority implements our recommendations.




                                               14
                             INTERNAL CONTROLS

Internal control is an integral component of an organization’s management that provides
reasonable assurance that the following objectives are being achieved:

   •   Effectiveness and efficiency of operations,
   •   Reliability of financial reporting, and
   •   Compliance with applicable laws and regulations.

Internal controls relate to management’s plans, methods, and procedures used to meet its
mission, goals, and objectives. Internal controls include the processes and procedures for
planning, organizing, directing, and controlling program operations. They include the systems
for measuring, reporting, and monitoring program performance.



 Relevant Internal Controls


              We determined the following internal controls were relevant to our objective:

                  •   Program operations – Policies and procedures that management has
                      implemented to reasonably ensure that a program meets its objectives.

                  •   Validity and reliability of data – Policies and procedures that management
                      has implemented to reasonably ensure that valid and reliable data are
                      obtained, maintained, and fairly disclosed in reports.

                  •   Compliance with laws and regulations – Policies and procedures that
                      management has implemented to reasonably ensure that resource use is
                      consistent with laws and regulations.

                  •   Safeguarding resources – Policies and procedures that management has
                      implemented to reasonably ensure that resources are safeguarded against
                      waste, loss, and misuse.

              We assessed the relevant controls identified above.

              A significant weakness exists if management controls do not provide reasonable
              assurance that the process for planning, organizing, directing, and controlling
              program operations will meet the organization’s objectives.




                                               15
Significant Weaknesses


           Based on our review, we believe the following item is a significant weakness:

               •   The Authority lacked sufficient procedures and controls to ensure
                   compliance with HUD regulations and/or the Authority’s program
                   administrative plan to ensure the maximum number of housing choice
                   vouchers were used, its waiting list was adequately managed, and its
                   Family Self-Sufficiency program was operated in accordance with HUD
                   requirements.




                                            16
                                    APPENDIXES

Appendix A

              SCHEDULE OF QUESTIONED COSTS
             AND FUNDS TO BE PUT TO BETTER USE

         Recommendation            Ineligible 1/    Unsupported      Funds to be put
                number                                       2/       to better use 3/
                       1A                                                $3,361,534
                       1B                              $346,432
                       2A              $84,009


1/   Ineligible costs are costs charged to a HUD-financed or HUD-insured program or activity
     that the auditor believes are not allowable by law; contract; or federal, state, or local
     polices or regulations.

2/   Unsupported costs are those costs charged to a HUD-financed or HUD-insured program
     or activity when we cannot determine eligibility at the time of audit. Unsupported costs
     require a decision by HUD program officials. This decision, in addition to obtaining
     supporting documentation, might involve a legal interpretation or clarification of
     departmental policies and procedures.

3/   Recommendations that funds be put to better use are estimates of amounts that could be
     used more efficiently if an Office of Inspector General (OIG) recommendation is
     implemented. This includes reductions in outlays, deobligation of funds, withdrawal of
     interest subsidy costs not incurred by implementing recommended improvements,
     avoidance of unnecessary expenditures noted in preaward reviews, and any other savings
     which are specifically identified. By implementing adequate controls and procedures to
     ensure the maximum number of housing choice vouchers are issued, the Authority will
     provide additional housing to eligible participants thereby, putting approximately $3.4
     million in program funds to better use. When the Authority successfully improves its
     controls, this will be a recurring benefit. Our estimate reflects only the initial year of
     these recurring benefits.




                                             17
Appendix B

        AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




Comment 1




                         18
Comment 2




Comment 1




Comment 1




Comment 1




Comment 1




            19
Comment 2




Comment 1




Comment 1




            20
21
                         OIG Evaluation of Auditee Comments

Comment 1   We are encouraged that the Authority has acknowledged the problems associated
            with its administration of the Section 8 Housing Choice Voucher program and is
            actively working to correct the problems discussed in this report.

Comment 2   We have performed a thorough review of the Authority’s files related to our audit
            sample and we have evaluated and factored into our audit conclusions all of the
            documentation the Authority has provided to date.




                                            22
Appendix C

                                        CRITERIA

Finding 1

24 CFR [Code of Federal Regulations] 982.204(a) states that except for special admissions,
participants must be selected from the PHA [public housing agency] waiting list. The PHA must
select participants from the waiting list in accordance with admission policies in the PHA
administrative plan.

24 CFR [Code of Federal Regulations] 982.204(b) states that the PHA must maintain
information that permits the PHA to select participants from the waiting list in accordance with
the PHA admission policies.

24 CFR [Code of Federal Regulations] 982.203(a)(2) states that the PHA may admit a family
that is not on the PHA waiting list or without considering the family’s waiting list position. The
PHA must maintain records showing that the family was admitted with HUD-targeted assistance.

Notice PIH 2005-9 states that PHAs are provided a fixed amount of funds to assist as many
families as possible, provided that on December 31, 2005, the number of unit months leased
[vouchers issued] for the calendar year does not exceed the cumulative number of unit months
available [vouchers authorized for use] for the same period.

Notice PIH 2006-03 states that excess budget authority disbursed to PHAs that is not utilized to
pay Housing Assistance Payments (HAP) may only be used to assist additional families up to the
number of units [vouchers] under contract. This Notice provides that any unused ACC reserves
remaining after December 31, 2005, will be reduced to zero. Additionally, this notice provides
that any budget authority provided to PHAs in calendar year 2005 that exceeds actual program
expenses for the same period must be maintained in a PHA’s undesignated fund balance account
in accordance with Generally Accepted Accounting Principles. HUD will closely monitor both
overutilization and underutilization of funds and will take appropriate action to assure
appropriated funds are being used to serve as many families up to the number of vouchers
authorized under the program.

Notice PIH 2007-14 (HA) continues to provide that any budget authority provided to the PHA in
calendar year 2007 that exceeds actual program expenses for the same period must be maintained
in the PHA’s undesignated fund balance account in accordance with Generally Accepted
Accounting Principles.

The Authority’s Section 8 administrative plan:

Chapter 4, section A, states that the PHA will maintain information that permits proper selection
from the waiting list. Additionally, the waiting list will contain the following information for

                                                 23
each applicant listed: applicant name, family unit size, date and time of application, qualification
for any local preference, racial or ethnic designation of the head of household.

Chapter 4, section I, states that the PHA's method for selecting applicants from a preference trail
leaves a clear audit trail that can be used to verify that each applicant has been selected in
accordance with the method specified in the administrative plan. The plan also states that among
applicants with equal preference status, the waiting list will be organized by computer random
selection.

Chapter 4, section L, states that the waiting list will be purged approximately every two years by
a mailing to all applicants to ensure that the waiting list is current and accurate. The mailing will
ask for written confirmation of continued interest by returning the attached update form in the
provided self-addressed envelope.


Finding 2

United States Code, title 42, chapter 8, subchapter I, subsection 1437u(a) states the purpose of
the Family Self-Sufficiency program established under this section is to promote the
development of local strategies to coordinate use of public housing and assistance under the
certificate and voucher programs under section 1437f of this title with public and private
resources to enable eligible households to achieve economic and self-sufficiency.

The United States Code, title 42, chapter 8, subchapter I, subsection 1437u(c)(1), provides that
each public housing agency carrying out a local program under this section shall enter into a
contract with each leaseholder receiving assistance under the voucher program of the public
housing agency that elects to participate in the self-sufficiency program under this section. The
contract shall establish specific interim and final goals by which compliance with and
performance of the contract may be measured and shall specify the resources and supportive
services to be made available to the participating household.

24 CFR [Code of Federal Regulations] 984.303(a) states that each family that is selected to
participate in a Family Self-Sufficiency program must enter into a contract of participation with
the PHA that operates the Family Self-Sufficiency program in which the family will participate.
The contract of participation shall be signed by the head of the Family Self-Sufficiency family.

24 CFR [Code of Federal Regulations] 984.303(b)(4) states the head of the Family Self-
Sufficiency program household is required under the contract of participation to seek and
maintain suitable employment during the term of the contract.

24 CFR [Code of Federal Regulations] 984.303(d) states that the PHA shall, in writing, extend
the term of the contract of participation for a period not to exceed two years for any Family Self-
Sufficiency program family that requests in writing an extension of the contract, provided that
the PHA finds that good cause exists for granting the extension. The family’s written request for
an extension must include a description of the need for the extension. As used in this paragraph,
“good cause” means circumstances beyond the control of the Family Self-Sufficiency program

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family, as determined by the PHA, such as a serious illness or involuntary loss of employment.
Extension of the contract of participation will entitle the Family Self-Sufficiency program family
to continue to have amounts credited to the family’s Family Self-Sufficiency program account in
accordance with section 984.304.

24 CFR [Code of Federal Regulations] 984.303(f) states that the Authority and the Family Self-
Sufficiency program family may mutually agree to modify the contract of participation. The
contract of participation may be modified in writing with respect to the individual training and
services plans, the contract term, and the designation of the head of the family.

24 CFR [Code of Federal Regulations] 984.303(g) states the contract of participation is
considered to be completed, and a family’s participation in the Family Self-Sufficiency program
is considered to be concluded, when the Family Self-Sufficiency program family has fulfilled all
of its obligations under the contract of participation on or before the expiration of the contract
term, including any extension thereof.

The Family Self-Sufficiency program contract of participation states that the head of family must
seek and maintain suitable employment after completion of the job training programs listed in
the individual training and services plan.

The Family Self-Sufficiency program contract of participation states that the head of the family
and those family members, who have decided, with Authority agreement, to execute an
individual training and services plan, must

   •   Complete the activities within the dates listed in each individual training and services
       plan.

   •   Provide the Authority and HUD with the information about the family’s participation in
       the program in order to help the Authority and HUD evaluate the program.

The instructions for the Family Self-Sufficiency program contract of participation state that any
change/s to the individual training and services plan must be included as a revision to the
individual training and services plan (attachment) to which the change applies. The revision
must include the item changed, signatures of the participant and an Authority representative, and
the date signed.

Under the terms of the Family Self-Sufficiency program contract of participation, the Authority
can extend the term of the contract up to two years if the family gives the Authority a written
request for an extension and the Authority finds that good cause exists for the extension.




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