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-214-1803 November 2, 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: Westgate Management Company Survey of Management Agent Operations Trenton, New Jersey We completed the subject survey. The purpose of the survey was to review selected management agent operations in the Mid-Atlantic, Pittsburgh Field Office jurisdiction 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 Westgate; - financial management; and - leasing and occupancy. We interviewed Multifamily Asset Management Branch staff, and reviewed HUD files relative to projects managed by Westgate. We reviewed the latest IPA audit reports. We visited the Westgate offices and interviewed staff. We selected four projects for physical inspection and tenant file review, Douglas Plaza Apts, Hawksworth Garden II, Village of Searights and Mountainview Gardens. 2 Our survey disclosed the following: Village of Searights: - Six of seven units inspected failed HQS for lack of a discharge line on the water heaters. The manager acknowledged that a discharge line would need to be installed on all unit water heaters. The manager was not aware this was an HQS requirement. - Vacancy claims were submitted improperly. Supporting documentation for 1995 vacancy claims disclosed that unit turnaround times were greater than reported resulting in an overpayment of $876. The manager attributed the discrepancy to miscommunication between maintenance and the person preparing the claims. The manager agreed to document the date a unit is ready for occupancy via work order in the future. - The project received HAP payments totaling $950 for a unit which was never occupied. A qualified applicant paid a security deposit and two month's rent but never moved into the unit. A medical disability arose between eligibility processing and occupancy which precluded move-in. The manager was unaware the tenant had not moved in. Douglas Plaza - The manager inadvertently processed the last market rent increase incorrectly. Market renters have been undercharged $2 and $1 for one bedroom and one bedroom deluxe units respectively since April, 1994. As a result excess rental income payable to HUD has been underpaid by $710. No reportable deficiencies were noted regarding financial management and leasing. 3 Review results were discussed with Westgate and they concurred with OIG's presentation. Recovery of the excess vacancy claims, ineligible HAP, and excess rental income was processed through Westgate's October HAP request and Monthly Report of Excess Income submittal. Corrective action was planned for the HQS violation. Although no controlled findings resulted from our review, we recommend your staff confirm the HQS resolution during your next physical inspection of the Village of Searights. 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 CC: OSWALD CIANCI 3AGA:GUSS:AMP:11/02/95 Correspondence Code 3AGA Concurrence GUSS Date REPORT NAME: Westgate Management Company Survey of Management Agent Operations Trenton, New Jersey REPORT NO: 96-PH-214-1803 ISSUE DATE: November 2, 1995 REGIONAL OFFICE (NON-OIG) Edward J. Palombizio, Director, Multifamily Division, 1 Pittsburgh Area Office, 3EHM Regional Comptroller, 3AF 1 HEADQUARTERS (OIG) Director, Planning and Administration, GAP (Room 8180) 1 Director, Quality Assurance and Audit Follow-up Staff, GAD 1 (Room 8174) Central Files, GFA (Room 8266) 2 Semi-Annual Report Coordinator, GFA (Room 8254) 1 DISTRIBUTION OUTSIDE HUD Assistant Director in Charge, US GAO, 820 1st St. NE Union Plaza 1 Bldg 2, Suite 150, Washington, DC 20002 8 Attn: Mr. Cliff Fowler From: Edward F. Momorella, DIGA, Mid-Atlantic Wanamaker Building, Suite 1005 100 Penn Square East Philadelphia, PA 19107-3380 Attachment 1 _________________________________________________________________ DISTRIBUTION Director, Multifamily Division, Pittsburgh Area Office, 3EHM 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
Westgate Management Company, Trenton, NJ
Published by the Department of Housing and Urban Development, Office of Inspector General on 1995-11-02.
Below is a raw (and likely hideous) rendition of the original report. (PDF)