Indiana PHA Didn't Always Comply with HCV Program Requirements

HUD’s OIG found that the Housing Authority of the City of Muncie didn’t always administer its Housing Choice Voucher program in accordance with HUD’s and its own requirements. It did not: (1) obtain and maintain required eligibility documentation; and (2) correctly calculate and pay housing assistance and utility allowances. As a result of these weaknesses, HUD and the PHA lacked assurance that more than $587,000 in program funds was used appropriately. If the PHA doesn’t correct its certification process, OIG estimates that it could overpay nearly $251,000 in housing assistance over the next year.

In addition, the PHA didn’t appropriately use HUD’s Enterprise Income Verification system to identify program households with unreported or underreported income to recapture overpaid housing assistance and utility allowances. As a result, nearly $76,000 in program funds wasn’t available for other program use.

The PHA also didn’t appropriately manage its Family Self-Sufficiency program. As a result, HUD and the PHA lacked assurance that: (1) program participants benefited from the program or had made progress toward self-sufficiency; and (2) more than $100,000 in program funds was used appropriately.

Auditors recommended that the Director of HUD’s Indianapolis Office of Public and Indian Housing require the PHA to: (1) support or reimburse its program more than $617,000 from non-federal funds for the unsupported housing assistance payments and Family Self-Sufficiency program escrow fund activities; (2) reimburse its program more than $88,000 from non-federal funds for the ineligible housing assistance payments; (3) reimburse its program households more than $2,300 for the overpayment of housing assistance; (4) transfer more than $55,000 to its Housing Choice Voucher program; and (5) implement adequate controls to address the findings cited in this audit report.

• HUD Audit 2016-CH-1006, August 2016