oversight

The Huntsville Housing Authority Administered Its Section 8 Housing Choice Voucher Program in Accordance With HUD's and Its Own Requirements

Published by the Department of Housing and Urban Development, Office of Inspector General on 2016-02-18.

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

          Huntsville Housing Authority,
                 Huntsville, AL
          Section 8 Housing Choice Voucher Program




Office of Audit, Region 4       Audit Report Number: 2016-AT-1003
Atlanta, GA                                      February 18, 2016
To:            Robert L. Kenner, Director Office of Public and Indian Housing, 4CPH


               //signed//
From:          Nikita N. Irons, Regional Inspector General for Audit, 4AGA
Subject:       The Huntsville Housing Authority Administered Its Section 8 Housing Choice
               Voucher Program in Accordance With HUD’s and Its Own Requirements


Attached is the U.S. Department of Housing and Urban Development (HUD), Office of Inspector
General’s (OIG) final results of our review of the Huntsville Housing Authority’s Section 8
Housing Choice Voucher program.
HUD Handbook 2000.06, REV-4, sets specific timeframes for management decisions on
recommended corrective actions. Please furnish us copies of any correspondence or directives
issued because of the audit.
The Inspector General Act, Title 5 United States Code, section 8M, requires that OIG post its
publicly available reports on the OIG Web site. Accordingly, this report will be posted at
http://www.hudoig.gov.
If you have any questions or comments about this report, please do not hesitate to call me at
404-331-3369.
                   Audit Report Number: 2016-AT-1003
                   Date: February 18, 2016

                   The Huntsville Housing Authority Administered Its Section 8 Housing Choice
                   Voucher Program in Accordance With HUD’s and Its Own Requirements




Highlights

What We Audited and Why
We audited the Huntsville Housing Authority’s Section 8 Housing Choice Voucher program.
We initiated the audit under the U.S. Department of Housing and Urban Development (HUD), Office
of Inspector General’s (OIG) annual audit plan. We selected the Authority as part of a strategic
plan with the Assistant United States Attorney in Northern Alabama to evaluate housing
authorities in her jurisdiction. Our audit objective was to determine whether the Authority
administered its Section 8 Housing Choice Voucher program in accordance with HUD’s and its
own requirements. Specifically, we reviewed the Authority’s administration of the program,
including tenant and unit eligibility and the accuracy of housing assistance payments.

What We Found
The Authority administered its Section 8 Housing Choice Voucher program in accordance with
HUD’s and its own requirements. It ensured that the tenants and units were eligible, and the
housing assistance payments were accurate.

What We Recommend
This report contains no recommendations.
Table of Contents
Background and Objective......................................................................................3

Results of Audit ........................................................................................................4
         Finding: The Authority Administered Its Housing Choice Voucher Program in
         Accordance With Requirements ...................................................................................... 4

Scope and Methodology ...........................................................................................5

Internal Controls ......................................................................................................7

Appendix ...................................................................................................................8

         A. Auditee Comments ...................................................................................................... 8




                                                                 2
Background and Objective
The Huntsville Housing Authority is located in Madison County in the city of Huntsville, AL. It
was organized and incorporated by the State of Alabama in August 1941 to act as an authority
under the Housing Authorities Law, as set forth and provided for in title 25, chapter 2, of the
code of Alabama of 1940. The mission and purpose of the Authority is to provide safe, decent,
and affordable housing for citizens of Huntsville. The Authority is governed by a five-member
board of commissioners, appointed by the mayor. Each member serves a 5-year term.
The Authority’s major programs include the Conventional Public Housing Program, which
includes the Public Housing Capital Fund program, the Neighborhood Stabilization Program,
and the Housing Choice Voucher program. The Authority’s annual contributions contract
provides operating subsidies for Authority-owned public housing facilities and Housing Choice
Voucher program housing assistance payments for eligible families.
Under the Housing Choice Voucher program, the Authority administers contracts with
independent landlords that own the property. The Authority subsidizes the family participants’
rent through housing assistance payments made to the landlords. The U.S. Department of
Housing and Urban Development (HUD) provides annual funding to enable the Authority to
structure leases that set the participants’ rent at 30 percent of household income.
HUD awarded the Authority more than $24.5 million for fiscal years 2013 through 2015 for its
Housing Choice Voucher program, which included administrative fees and housing assistance
payment funds. In June 2015, the Authority’s Section 8 program administered 1,618 vouchers.
HUD’s Alabama State Office of Public Housing in Birmingham, AL, is responsible for overseeing
the Authority.

Our audit objective was to determine whether the Authority administered its Section 8 Housing
Choice Voucher program in accordance with HUD’s and its own requirements. Specifically, we
reviewed the Authority’s administration of the program, including tenant and unit eligibility and
the accuracy of housing assistance payments.




                                                3
Results of Audit

Finding: The Authority Administered Its Housing Choice Voucher
Program in Accordance With Requirements
The Authority administered its Section 8 Housing Choice Voucher program in accordance with
HUD’s and its own requirements. Specifically, the Authority’s tenants and units were eligible for
the program, and the housing assistance payments were accurate.

Tenants and Units Were Eligible
We reviewed a statistical sample of 14 single monthly housing assistance payments, combined
with utility assistance payments. We reviewed the housing assistance payments to determine the
tenants’ eligibility initially and for the sampled month. We also verified the eligibility of the
tenants’ units by ensuring that the tenant files contained the initial inspection reports, as well as
timely inspection reports, before the monthly payment reviewed. All 14 tenants and units were
eligible for the program.

Housing Assistance Payment Calculations Were Accurate
We reviewed the accuracy of the housing assistance payment calculations for the 14 monthly
payments. The documentation in the tenant files adequately supported that the housing
assistance payment calculations were accurate.
Conclusion
The Authority administered its Section 8 Housing Choice Voucher program in accordance with
HUD’s and its own requirements. For the 14 monthly payments reviewed, the Authority
adequately supported the eligibility of tenants and units, and the housing assistance payments
were accurately calculated.




                                                  4
Scope and Methodology
We performed our audit from September through November 2015 at the Authority in Huntsville,
AL. Our review generally covered the period January 1, 2013, through August 31, 2015, and
was adjusted as necessary.
To accomplish our objective, we
   •   Interviewed HUD’s Office of Public and Indian Housing officials at the Birmingham,
       AL, State office and reviewed relevant background information;
   •   Reviewed applicable laws, regulations, and relevant HUD program requirements to
       ensure the eligibility of applicants;
   •   Interviewed Authority staff to obtain an understanding of the controls significant to the
       audit objective and assist in our review of its files;
   •   Reviewed organizational charts for the Authority and its administrative plan, articles of
       incorporation, bylaws, financial statements, and board minutes;
   •   Reviewed the most recent HUD monitoring reports; and
   •   Reviewed a statistical sample of 14 tenant files to verify the eligibility of the tenants
       initially and for the sampled month. We also verified the eligibility of the tenants’ units
       by ensuring that the tenant files contained the initial inspection reports, as well as timely
       inspection reports, before the monthly payment reviewed.
To review the eligibility of tenants and units and to verify the housing assistance payments, we
developed a statistical sample of 90 monthly housing assistance payments combined with
applicable utility assistance payments paid for selected tenants. The 90 monthly payments
totaled $40,748. We reviewed a statistical sample of 14 monthly payments totaling $7,033. The
samples were selected from a universe of 44,063 monthly payments totaling more than $20
million. We reviewed the 14 monthly payments in the sample by reviewing the files and
verifying that the files contained adequate documentation to support that the tenants were
eligible initially and for the month sampled. We determined that the units were eligible by
verifying that the tenant files contained timely inspection reports for the sampled month. We
determined that the housing assistance payments were correct by verifying the income, rent, and
utility calculations for the sampled month. Since we reviewed only 14 the 90 sampled monthly
payments, the results of the audit apply only to items selected for review and cannot be projected to
the universe or population.

To achieve our audit objective, we relied in part on computer-processed data. We used the data
to select a sample of monthly assistance payments for review. Although we did not perform a
detailed assessment of the reliability of the data, we performed a minimal level of testing and
found the data to be adequate for our purposes.




                                                  5
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(s). We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objective.




                                                6
Internal Controls
Internal control is a process adopted by those charged with governance and management,
designed to provide reasonable assurance about the achievement of the organization’s mission,
goals, and objectives with regard to

•   Effectiveness and efficiency of operations,
•   Reliability of financial reporting, and
•   Compliance with applicable laws and regulations.
Internal controls comprise the plans, policies, methods, and procedures used to meet the
organization’s mission, goals, and objectives. Internal controls 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, while considering cost effectiveness
    and efficiency.
•   Compliance with laws and regulations – Policies and procedures that management has
    implemented to reasonably ensure that program implementation is consistent with laws and
    regulations.
We assessed the relevant controls identified above.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, the
reasonable opportunity to prevent, detect, or correct (1) impairments to effectiveness or
efficiency of operations, (2) misstatements in financial or performance information, or (3)
violations of laws and regulations on a timely basis.
We evaluated internal controls related to the audit objective in accordance with generally
accepted government auditing standards. Our evaluation of internal controls was not designed to
provide assurance regarding the effectiveness of the internal control structure as a whole.
Accordingly, we do not express an opinion on the effectiveness of the Authority’s internal
control.




                                                  7
Appendix A
             Auditee Comments




                    8