oversight

Supportive Housing Management Services, Clairton, PA

Published by the Department of Housing and Urban Development, Office of Inspector General on 1995-11-28.

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

                                        U.S. Department of Housing and Urban Development
                                                           Wanamaker Building, Suite 1005
                                                                     100 Penn Square East
                                                              Philadelphia, PA 19107-3380

                                                       District Inspector General for Audit


                                                    Audit Related Memorandum
                                                    No. 96-PH-214-1003

November 28, 1995


MEMORANDUM FOR:      Edward J. Palombizio, Director, Multifamily
                       Division, Pittsburgh Area Office, 3EHM


FROM:       Edward F. Momorella, District Inspector General
              for Audit, Mid-Atlantic, 3AGA

SUBJECT:      Supportive Housing Management Services
              Survey of Management Agent Operations
              Clairton, Pennsylvania


We completed the subject survey. The purpose of the survey was to
review selected management agent operations and determine whether
further audit work was necessary.

Specific areas reviewed during the survey were:

        -      general physical   condition and maintenance of the
               projects managed   by Supportive Housing Management
               Services (SHMS);

        -      financial management; and

        -      leasing and occupancy.

We interviewed Multifamily Asset Management Branch staff, and
reviewed HUD files relative to projects managed by SHMS.        We
reviewed the latest IPA audit reports. We visited the SHMS offices
and interviewed staff.    We selected four projects for physical
inspection and tenant file review, Versailles-Archer Place, Laurel
Wood Apartments, Allegheny Independence and Wesley Commons.
                                                                  2

Our survey disclosed the following:

Laurel Wood Apartments:

     -    The Security Deposit Account was underfunded by $280 due
          to clerical errors.     During the review, the manager
          reconciled the account with tenant and bank records and
          deposited $280 into the account from project operations
          to reconcile the discrepancy.

     -    The Reserve for Replacement Account was       underfunded
          $10,577 due to cash deficits during initial   operations.
          During the review, the manager deposited      $4,943 from
          funds available in the Tax and Insurance      Account and
          agreed to pay the remaining $5,634            in monthly
          installments until paid in full.

Wesley Commons:

     -    One tenant was selected for housing who had not been on
          the waiting list. The manager could not explain how this
          occurred other than to note that the selection occurred
          when the staff was relocated in temporary quarters due to
          a fire and everything was in a state of disarray.

     -    Items cited on the latest physical inspection report
          dated June 26, 1995 have not been corrected to date.
          Units affected by these deficiencies failed HQS. A plan
          of action plan has been prepared and awaits owner
          authorization.

     -    For two tenants, court ordered support payments were not
          included as income. As a result tenant monthly rents
          were understated and HAPs were overpaid by $9 and $13
          respectively.    The manager did not consider support
          payments income because some tenants do not receive these
          funds regularly. The manager agreed to include support
          payments as income until receiving tenant notification to
          the contrary.

     -    A tenant's rent was overstated by $75 monthly due to
          clerical oversight. The manager inadvertently used the
          overtime wage rate as opposed to the regular rate when
          computing income.

     -    The manager allowed tenants to hand carry statements from
          public assistance to expedite the recertification
          process.
                                                                 3

During our review, the manager obtained adequate verifications of
income for all tenants where necessary, and agreed to require third
party verifications for all future tenant certifications. Further,
the manager recertified all tenants cited above and adjusted tenant
rents and HAPs accordingly. SHMS agreed to remit the ineligible
HAP through offset on the December HAP submissions.

Versailles Archer:

     -    A tenant overpaid rent by $42 monthly because the manager
          overlooked the medical deduction for Medicare B payments.
          During the review, the manager reverified income and
          deductions, recertified the tenant, and refunded the
          overpayment.

                         *    *    *    *

Review results were discussed with SHMS who concurred with OIG's
presentation.   A schedule detailing cited tenant certification
deficiencies was provided your staff.

Although no controlled findings resulted from our review, we
recommend your staff for:

Wesley Commons

     -    Confirm the repayment of ineligible HAP on the December
          1995 HAP submission.

     -    Continue in your efforts to ensure the action plan to
          correct physical deficiencies is undertaken.

Laurel Wood Apartments

     -    Monitor the timely reimbursement to the Reserve for
          Replacement account.

Based on the survey work done, we have concluded no additional
audit work is necessary.

If you have any questions please contact Irving I. Guss, Assistant
District Inspector General for Audit at (215) 656-3401.

Attachment - Distribution
3AGA:GUSS:AMP:11/28/95
 Correspondence
 Code                    3AGA
 Concurrence             GUSS
 Date

_________________________________________________________________
DISTRIBUTION


Director, Multifamily Division, Pittsburgh Area Office, 3EHM
 Attn: Edward J. Palombizio
Regional Comptroller, 3AF

Assistant Director in Charge
US GAO
820 1st St. NE Union Plaza
Bldg 2, Suite 150
Washington, DC 20002
Attn: Mr. Cliff Fowler