oversight

The Wilmington Housing Authority, Wilmington, Delaware, Did Not Ensure That Its Section 8 Housing Choice Voucher Program Units Met Housing Quality Standards

Published by the Department of Housing and Urban Development, Office of Inspector General on 2009-07-30.

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

                                                               Issue Date
                                                                      July 30, 2009
                                                               Audit Report Number
                                                                      2009-PH-1011




TO:        Dennis G. Bellingtier, Director, Office of Public Housing, Pennsylvania State
            Office, 3APH


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

SUBJECT:   The Wilmington Housing Authority, Wilmington, Delaware, Did Not Ensure
            That Its Section 8 Housing Choice Voucher Program Units Met Housing
            Quality Standards


                                 HIGHLIGHTS

 What We Audited and Why

           We audited the Wilmington Housing Authority’s (Authority) administration of its
           housing quality standards inspection program for its Section 8 Housing Choice
           Voucher program as part of our fiscal year 2009 audit plan. The audit objective
           was to determine whether the Authority adequately administered its Section 8
           housing quality standards inspection program to ensure that its program units met
           housing quality standards in accordance with U.S. Department of Housing and
           Urban Development (HUD) requirements.


 What We Found

           The Authority did not adequately administer its inspection program to ensure that
           its program units met housing quality standards as required. We inspected 60
           housing units and found that 52 units did not meet HUD’s housing quality
           standards. Moreover, 37 of the 52 units materially failed to meet housing quality
           standards. The units had significant health and safety violations that the
           Authority’s inspectors did not observe or report during their last inspection. The
           Authority spent $66,934 in program and administrative funds for these 37 units.

           We estimate that over the next year if the Authority does not implement adequate
           procedures and controls to ensure that its program units meet housing quality
           standards, HUD will pay more than $1.9 million in housing assistance on units
           with material housing quality standards violations.


What We Recommend

           We recommend that the Director of HUD’s Pennsylvania State Office of Public
           Housing require the Authority to ensure that housing units inspected during the
           audit are repaired to meet HUD’s housing quality standards, reimburse its
           program from nonfederal funds for the improper use of $66,934 in program and
           administrative funds for units that materially failed to meet HUD’s housing
           quality standards, and implement adequate procedures and controls to ensure that
           in the future, program units meet housing quality standards to prevent an
           estimated $1.9 million from being spent annually on units that materially fail to
           meet HUD’s housing quality standards.

           For each recommendation without a management decision, please respond and
           provide status reports in accordance with HUD Handbook 2000.06, REV-3.
           Please furnish us copies of any correspondence or directives issued because of the
           audit.

Auditee’s Response


           We provided our discussion draft audit report to the Authority on June 18, 2009.
           We discussed the audit results with the Authority during the audit and at an exit
           conference on July 7, 2009. The Authority provided written comments to our
           draft report on July 10, 2009. 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 Objective                                                 4

Results of Audit
      Finding: Controls over Housing Quality Standards Were Inadequate   5

Scope and Methodology                                                    12

Internal Controls                                                        14

Appendixes
   A. Schedule of Questioned Costs and Funds to Be Put to Better Use     16
   B. Auditee Comments and OIG’s Evaluation                              17




                                            3
                       BACKGROUND AND OBJECTIVE

The Wilmington Housing Authority (Authority) was created in March 1938 when the Delaware
State Board of Housing determined that there was a need for a housing authority in the city of
Wilmington. The Authority is governed by an eight-member board of commissioners. The
current executive director is Frederick Purnell. The Authority’s main administrative office is
located at 400 North Walnut Street, Wilmington, Delaware.

Under the Section 8 Housing Choice Voucher program, the Authority makes rental assistance
payments to landlords on behalf of eligible low-income families. The U.S. Department of
Housing and Urban Development (HUD) compensates the Authority for the cost of
administering the program through administrative fees.

HUD authorized the Authority to provide leased housing assistance payments for 1,427 eligible
households. HUD authorized the Authority the following financial assistance for fiscal years
2006 through 2008:


                Authority fiscal         Annual budget
                     year                  authority               Disbursed
                    2006                   $8,592,513              $8,592,513
                    2007                   $9,701,262              $9,701,262
                    2008                   $9,670,371              $9,670,371
                    Totals                $27,964,146             $27,964,146

HUD regulations at 24 CFR [Code of Federal Regulations] 982.305(a)(2) state that the public
housing authority may not give approval for the family of the assisted tenancy or execute a
housing assistance contract until the authority has determined that the unit has been inspected by
the authority and meets HUD’s housing quality standards.

HUD regulations at 24 CFR 982.405(a) require public housing authorities to perform unit
inspections before the initial move-in and at least annually. The authority must inspect the unit
leased to the family before the term of the lease, at least annually during assisted occupancy, and
at other times as needed to determine whether the unit meets housing quality standards.

The audit objective was to determine whether the Authority adequately administered its Section
8 housing quality standards inspection program to ensure that its program units met housing
quality standards in accordance with HUD requirements. As part of this audit, we also reviewed
the Authority’s waiting list procedures. Minor findings noted in relation to the Authority’s
waiting list procedures were separately communicated to the Authority in a letter, dated July 10,
2009.




                                                 4
                                RESULTS OF AUDIT

Finding: Controls over Housing Quality Standards Were Inadequate
The Authority did not adequately enforce HUD’s housing quality standards. Of 60 program
units selected for inspection, 52 did not meet HUD’s housing quality standards, and 37
materially failed to meet housing quality standards. The Authority’s inspectors did not observe
or report 373 health and safety violations which existed at the units when they conducted their
inspections. The deficiencies occurred because the Authority did not ensure that its inspectors
had sufficient knowledge of housing quality standards requirements and consistently followed
the requirements. The Authority also did not implement an effective quality control inspection
process. As a result, it spent $66,934 in program and administrative funds on units that
materially failed to meet HUD’s housing quality standards and, consequently, were not decent,
safe, and sanitary. By implementing adequate procedures and controls the Authority could
ensure that its program units meet HUD’s housing quality standards to prevent an estimated $1.9
million in program funds from being spent annually on units that materially fail to meet housing
quality standards.



 Section 8 Tenant-Based
 Housing Units Were Not in
 Compliance with HUD’s
 Housing Quality Standards


              We statistically selected 60 units from unit inspections passed by the Authority’s
              inspectors during the period August 2008 to January 2009. The 60 units were
              selected to determine whether the Authority ensured that the units in its program
              met housing quality standards. We inspected the selected units between
              February 17 and February 26, 2009.

              Of the 60 units inspected, 52 (87 percent) had 719 housing quality standards
              violations. Additionally, 37 of the 60 units (62 percent) were considered to be in
              material noncompliance because they had significant health and safety violations
              that predated the Authority’s last inspection and were not identified by the
              Authority’s inspectors and/or repaired. The 37 units had 373 health and safety
              violations that existed before the Authority’s last inspection report and were not
              identified by the Authority’s inspectors. HUD regulations at 24 CFR 982.401
              require that all program housing meet HUD’s housing quality standards at the
              beginning of the assisted occupancy and throughout the tenancy.




                                               5
The following table categorizes the 719 housing quality standards violations in
the 52 units that failed the housing quality standards inspections.

          Category of violations              Number       Number
                                                 of          of
                                             violations     units
             Electrical                         224          47
             Security                           122          42
             Interior stairs                     46          29
             Smoke detectors/carbon              31          18
             monoxide detectors
             Stairs, rails, and porches          30            22
             Heating, ventilation, and           29            22
             plumbing
             Exterior surfaces                   29            22
             Stove, oven, and refrigerator       28            23
             Other interior hazards              28            13
             Floor conditions                    26            18
             Other potentially hazardous         26            18
             features
             Windows                             21            11
             Roof and gutters                    11            10
             Toilet                              10             9
             Ceiling conditions                   9             6
             Site and neighborhood                9             5
             conditions
             Wall condition                       8            5
             Sink and cabinets                    8            5
             Evidence of infestation              7            7
             Tub/shower                           4            4
             Space for preparation,               3            3
             storage, and serving of food
             Foundation                           3            3
             Lead-based paint                     3            2
             Electricity/illumination             2            2
             Interior air quality                 1            1
             Garbage and debris                   1            1

                        Total                    719


We presented the results of the housing quality standards inspections to the
Authority and to the Director of HUD’s Pennsylvania State Office of Public
Housing.


                                 6
Housing Quality Standards
Violations Were Identified


            The following pictures illustrate some of the violations we noted while
            conducting housing quality standards inspections at the Authority’s leased
            housing units.




            Inspection V38083: Flue pipe is rusted/disconnected from the furnace and is
            releasing fumes into the basement. This violation was not identified during the
            Authority’s January 6, 2009, inspection.




            Inspection V21104: Cover is missing on junction box. This violation was not
             identified during the Authority’s December 18, 2008, inspection.


                                                   7
Inspection V20045: Electrical connection is made outside of the junction box.
This violation was not identified during the Authority’s September 5, 2008,
inspection.




Inspection V20039: Basement stairs need a handrail. This violation was not
identified during the Authority’s January 26, 2009, inspection.




                                      8
           Inspection V51089: Mold is present from a water leak. This violation was not
            identified during the Authority’s August 25, 2008, inspection.


The Authority Did Not Have
Adequate Procedures and
Controls


           Although HUD regulations at 24 CFR 982.401 and the Authority’s administrative
           plan required the Authority to ensure that its program units met housing quality
           standards, it failed to do so because it did not ensure that its housing inspectors
           had sufficient knowledge of housing quality standards requirements and
           consistently followed the requirements. It also did not implement an effective
           quality control inspection process.

           The Authority’s Housing Inspectors Did Not Have Sufficient Knowledge of
           Housing Quality Standards and Did Not Always Follow Housing Quality
           Standards Requirements

           The Authority’s housing inspectors were either not aware of applicable housing
           quality standards requirements or disregarded the requirements. As a result, they
           missed or overlooked several housing quality standards violations. For example,
           one inspector did not know that missing knockout plugs were an issue until we
           brought it to the inspector’s attention during the audit. Also, two inspectors and
           the quality control inspector were not aware that railings were required for
           porches, balconies, and stoops more than 30 inches above the ground. In another
           example, the Authority failed a unit for not having a handrail on the front steps
           (which its inspectors missed for three years) and later passed the unit with a
           comment calling for the installation of the handrail. However, when we inspected
           the unit a little over a month after the Authority passed the unit, the handrail was

                                                 9
absent; therefore, the unit failed the inspection. In addition, the Authority failed a
unit for having a dead bolt lock on a bedroom door and later passed the unit with
a comment calling for the removal of the locking device. However, when we
inspected the unit within a month and a half of the Authority’s passing the unit,
the bedroom door had a keyed dead bolt lock; therefore, the unit failed the
inspection. The Authority’s Section 8 coordinator acknowledged that the units
should have failed the inspections because the violations were health- and safety-
related. She stated that the audit showed that the inspectors had not performed
inspections correctly and that the Authority would focus on improving its
inspections process based on what it learned from our audit.

The Authority’s inspectors had not all received adequate training. One of the
Authority’s three inspectors took housing quality standards training twice in 2004
and 2009 but failed the related examination both times. Also, the Authority’s
Section 8 coordinator, who was given that position in 2001, had also been the
quality control inspector since January 2006 but did not take housing quality
standards training until February 2009. HUD’s Housing Choice Voucher
Guidebook 7420.10G states that quality control reinspections should be conducted
by staff trained in the public housing authority’s inspection standards and those
staff members should receive the same guidance as other authority inspectors on
inspection policies and procedures.

The Authority needs to ensure that all of its inspectors are equipped with the
knowledge they need to perform inspections in accordance with housing quality
standards requirements and consistently follow the requirements.

The Authority Did Not Implement an Effective Quality Control Inspection
Process

The Authority did not implement an effective quality control process as a tool to
ensure that inspections were performed in compliance with HUD’s housing
quality standards. The Authority’s administrative plan states that the purpose of
quality control inspections is to ensure that each inspector conducts accurate and
complete inspections and that there is consistency in the application of the
housing quality standards. Also, HUD’s Housing Choice Voucher Guidebook
7420.10G states that the results of the quality control inspections should be
provided as feedback on inspectors’ work, which can be used to determine
whether individual performance or general housing quality standards training
issues need to be addressed.

The Authority’s quality control inspector previously provided the inspectors with
written documentation on the results of the quality control inspections; however,
she stated that she had stopped this practice more than a year earlier and began to
verbally communicate the information to inspectors due to time constraints.
However, although we noted one instance in which an inspector was suspended
for not properly performing inspections, we did not find sufficient evidence to

                                  10
             show that quality control results were communicated to the inspectors or used as a
             tool for improving inspectors’ performance.


Conclusion


             The Authority’s tenants were subjected to health- and safety-related violations, and
             the Authority did not properly use its program funds when it failed to ensure that
             its program units complied with HUD’s housing quality standards. In accordance
             with HUD regulations at 24 CFR 982.152(d), HUD is permitted to reduce or
             offset any program administrative fees paid to a public housing authority if it fails
             to perform its administrative responsibilities correctly or adequately, such as not
             enforcing HUD’s housing quality standards. The Authority disbursed $60,637 in
             housing assistance payments to landlords and received $6,297 in program
             administrative fees for the 37 units that materially failed to meet HUD’s housing
             quality standards. If the Authority implements procedures to ensure that its
             inspectors are equipped with the knowledge/training they need to perform
             inspections in compliance with HUD requirements and implements an effective
             quality control program, we estimate that more than $1.9 million in future housing
             assistance payments will be spent for units that are decent, safe, and sanitary. Our
             methodology for this estimate is explained in the Scope and Methodology section
             of this report.

Recommendations


             We recommend that the Director of HUD’s Pennsylvania State Office of Public
             Housing require the Authority to

             1A.    Verify that the owners of the 52 program units cited in this finding have
                    repaired the units containing housing quality standards violations.

             1B.    Reimburse HUD’s program $66,934 from nonfederal funds ($60,637 for
                    housing assistance payments and $6,297 in associated administrative fees)
                    for the 37 units that materially failed to meet HUD’s housing quality
                    standards.

             1C.    Ensure that its housing inspectors are equipped with the knowledge they
                    need to perform inspections in compliance with HUD’s housing quality
                    standards and implement an effective quality control process to prevent
                    $1,928,850 in program funds from being spent on units that do not comply
                    with the standards.




                                              11
                          SCOPE AND METHODOLOGY

We performed on-site audit work from October 2008 through May 2009 at the Authority’s main
administrative office located at 400 N. Walnut Street, Wilmington, Delaware, and at the
Authority’s Section 8 office located at 1400 Todds Lane, Wilmington, Delaware. The audit
covered the period October 2006 through February 2009 but was expanded when necessary to
include other periods.

To accomplish our objective, we reviewed

       Applicable laws, regulations, the Authority’s administrative plan, HUD’s program
       requirements at 24 CFR Parts 982 and 985, and HUD’s Housing Choice Voucher
       Guidebook 7420.10G.

       The Authority’s accounting records, annual audited financial statements for 2006 and 2007,
       tenant files, computerized databases, board meeting minutes, organizational chart, and
       program annual contributions contract.

       HUD’s monitoring reports for the Authority.

We also interviewed the Authority’s employees, HUD staff, and program households.

To achieve our audit objective, we relied in part on computer-processed data in the Authority’s
database. Although we did not perform a detailed assessment of the reliability of the data, we did
perform a minimal level of testing and found the data to be adequate for our purposes.

We statistically selected 60 of the Authority’s program units to inspect from 531 unit inspections
passed by the Authority’s inspectors during the period August 2008 to January 2009. We selected
the sample with the assistance of a computer specialist who computed the sample size using
attribute methodology and used a random number generator to compute a random sample. The
60 units were selected to determine whether the Authority’s program units met housing quality
standards. The sampling criteria used a 90 percent confidence level, 50 percent estimated error rate,
and precision of plus or minus 10 percent.

Our sampling results indicated that 52 of 60 program units selected for inspection did not meet
HUD’s housing quality standards. We ranked all the failed units based on the significance of the
violations, from the most serious health and safety violation that predated the Authority’s most
recent inspection to the least serious, and determined that 37 units (62 percent) materially failed to
meet HUD’s housing quality standards. Materially failed units were those with at least one health
and safety violation or exigent (24-hour) health and safety violation that predated the Authority’s
previous inspections. We used auditor judgment to determine the material cutoff line.

Projecting our sample review results of the 37 units (62 percent) that materially failed housing
quality standards inspections indicates that 328 or 61.67 percent of the total population of 531
units would materially fail to meet housing quality standards. The sampling error is plus or

                                                 12
minus 9.72 percent. There is a 90 percent confidence that the frequency of occurrence of
program units materially failing housing quality standards inspections lies between 51.94 and
71.39 percent of the population. This equates to an occurrence of between 275 and 379 units of
the 531 units in the population. We used the most conservative number, which is the lower limit
or 275 units.

We analyzed the applicable Authority databases and estimated that the average annual housing
assistance payment per recipient in our sample universe was $7,014. We used the period
October 2007 through September 2008 to determine the average annual housing assistance
payment of $7,014. Using the lower limit of the estimate of the number of units and the
estimated average annual housing assistance payment, we estimate that the Authority will spend
$1,928,850 (275 units times $7,014 estimated average annual housing assistance) annually for
units that are in material noncompliance with HUD’s housing quality standards.

Our estimates are presented solely to demonstrate the annual amount of program funds that could
be put to better use on decent, safe, and sanitary housing if the Authority implements our
recommendations. While these benefits would recur indefinitely, we were conservative in our
approach and only included the initial year in our estimate.

We conducted the audit in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain sufficient, appropriate
evidence to provide a reasonable basis for our findings and conclusions based on our audit
objective. We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objective.




                                              13
                              INTERNAL CONTROLS

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

       Program operations,
       Relevance and reliability of information,
       Compliance with applicable laws and regulations, and
       Safeguarding of assets and resources.

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




 Relevant Internal Controls


              We determined that the following internal controls were relevant to our audit
              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.

              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.

 Significant Weakness

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


                                               14
The Authority lacked sufficient procedures and controls to ensure that unit
inspections complied with HUD regulations and that program units met
minimum housing quality standards.




                         15
                                     APPENDIXES

Appendix A

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


                 Recommendation            Ineligible 1/   Funds to be put
                        number                             to better use 2/

                                1B               $66,934
                                1C                             $1,928,850


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
     policies or regulations.

2/   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. These amounts include 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 that are specifically identified. In this instance, if the Authority
     implements our recommendation, it will cease to incur program costs for units that are
     not decent, safe, and sanitary and, instead, will expend those funds for units that meet
     HUD’s standards, thereby putting approximately $1.9 million in program funds to better
     use. Once the Authority successfully implements our recommendation, this will be a
     recurring benefit. Our estimate reflects only the initial year of this benefit.




                                            16
Appendix B

        AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




                         17
Comment 1




Comment 1




Comment 2




Comment 3




            18
Comment 4




Comment 4




Comment 5




            19
Comment 6




Comment 6




Comment 7

Comment 7


Comment 7




            20
Comment 8

Comment 9




Comment 10




             21
Comment 11


Comment 11




Comment 11




Comment 11




Comment 12




             22
23
24
                         OIG Evaluation of Auditee Comments

Comment 1   The conclusions in the audit report are supported by audit work performed in
            accordance with generally accepted government auditing standards. We were
            conservative in our approach and used our professional knowledge, tenant
            interviews and the Authority’s latest inspection reports in determining whether a
            housing quality standards violation existed prior to the last passed inspection
            conducted by the Authority. Also, we used a conservative methodology and used
            our judgment to only require repayment of housing assistance payments on units
            with preexisting violations significant enough that we determined they could
            cause harm to the tenants. In addition, as explained during the audit, for the units
            with significant preexisting violations, we did not calculate any ineligible housing
            assistance payments for the first 30 days after the Authority’s last inspection to
            account for the abatement process. Therefore, we believe our methodology and
            the evidence we obtained provide a reasonable basis for our findings and
            conclusions based on our audit objective

Comment 2   In regards to the unit located at 2911 N. Market Street, Apt. #2, the missing outlet
            cover in the bedroom was cited as a violation but was not classified as a pre-
            existing condition. The issue we cited as a pre-existing condition was actually a
            broken outlet cover in the living room which we determined was preexisting
            based on the expertise of our inspector. According to HUD’s Housing Choice
            Voucher Guidebook 7420.10G, section 10.3, badly cracked outlets or cover plates
            are unacceptable.

Comment 3   In regards to the unit located at 602 W. 23rd Street, HUD’s Housing Choice
            Voucher Guidebook 7420.10G, section 10.3, states that exposed fuse box
            connections are not acceptable. The picture clearly shows exposed contacts inside
            the fuse box that the tenant could come in contact with. Also, wire connections
            within the fuse box are exposed and not secured inside a junction box. The cover
            on the fuse box must be secured by a small lock, wire or bolt and nut to protect
            the tenant from an electrical shock hazard. The concern here is about the safety of
            the tenant and not the functionality of the fuse box.

Comment 4   When we determined that a specific refrigerator door seal was torn such as in the
            unit located at 21 W. 29th Street, we reasonably concluded that the refrigerator
            was unable to maintain the proper interior temperature. The door seal is torn in
            two places at the top and bottom right side of door. The photo clearly shows that
            the seal is torn and has been allowing condensation for a considerable time as
            evidenced by the rust showing around the refrigerator frame. Condensation
            (water puddle) can be seen on the floor indicating a leaking seal. The fact that the
            seal is allowing condensation to accumulate on the floor indicates the refrigerator
            is running excessively and would not be cooling properly. HUD’s Housing
            Choice Voucher Guidebook 7420.10 G, section 10.3, states that the refrigerator
            must be of adequate size for the family and capable of maintaining a temperature
            low enough to keep food from spoiling. The guidebook includes an example for

                                             25
             clarification which states the refrigerator must be able to maintain temperature
             above 32 ºF, but generally below 40 ºF to keep food from spoiling. The
             guidebook further states that proper temperatures are difficult to maintain if door
             seals are removed or broken.

Comment 5    We reviewed the itemized response which the Authority provided during the audit
             and determined that no adjustments to our results were warranted. In fact, we
             provided the Authority information on housing quality standards requirements for
             certain deficiencies we noted that the Authority did not consider housing quality
             standards violations. As stated above, our audit conclusions are supported by
             audit work performed in accordance with generally accepted government auditing
             standards. Those standards require that we plan and perform the audit to obtain
             sufficient, appropriate evidence to provide a reasonable basis for our findings and
             conclusions based on our audit objective. Also, our calculation of ineligible costs
             was derived from a conservative approach. Therefore we disagree with the
             Authority’s assertion that our determination of ineligible costs is miscalculated
             and excessive.

Comment 6    We used our professional knowledge, tenant interviews and the Authority’s latest
             inspection reports in conservatively determining whether a housing quality
             standards violation existed prior to the last passed inspection conducted by the
             Authority. All units were ranked, and we used auditors’ judgment to determine
             the material cutoff line. We were very conservative in our approach and we
             believe that the audit evidence we obtained provides a reasonable basis for our
             findings and conclusions based on our audit objective.

Comment 7    We are encouraged that the Authority has taken action on all the units cited in
             the inspections and that the grounding conductor requirement will be
             addressed with existing and prospective landlords.

Comment 8    Our review was conducted independently, therefore, we cannot comment on the
             results of other reviews.

Comment 9    HUD’s Housing Choice Voucher Guidebook 7420.10G states that quality control
             reinspections should be conducted by staff trained in the public housing
             authority’s inspection standards and those staff members should receive the same
             guidance as other inspectors on inspection policies and procedures. The Section 8
             coordinator/quality control inspector did not take her first housing quality
             standards training until February 2009.

Comment 10 We are encouraged to know that the inspector will be scheduled to retake the
           examination and that the Authority plans to take measures to target expanded
           quality control reviews for the inspector’s areas in the interim. We are also
           encouraged by the Authority’s statement that it has implemented supplementary
           in-house training.



                                              26
Comment 11 Our conclusions pertaining to the Authority’s quality control process pertain to
           how the results were used and not the number of inspections performed. As
           discussed in the report, we did not find sufficient evidence to show that the
           quality control results were communicated to the inspectors or used as a tool to
           improve their performance.

Comment 12 The Authority was very cooperative and professional throughout the audit
           engagement. We commend the Authority for creating a favorable environment
           for conducting the audit. We are encouraged to know that the Authority looks to
           use the results of this audit to better its programs.




                                             27