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At the request of the U.S. Department of Housing and Urban Development’s (HUD) Office of Public Housing in Albuquerque, NM, we conducted a review of the Mesilla Valley Public Housing Authority.  The Office of Public Housing estimated that the Authority could lose nearly $1 million by the end of 2014 because it had leased only 983 of its 1,607 vouchers.  Our objectives were to determine the extent, cause, and impact of not leasing all of its vouchers, and whether the Authority implemented its low-rent and Housing Choice Voucher programs in accordance with HUD regulations.

We did not determine the extent, cause, and impact of the Authority not leasing all of its vouchers because HUD’s Office of Public Housing changed the housing assistance payment reserve offset formula, which meant that the Authority would no longer lose nearly $1 million at the end of 2014.  The Albuquerque, NM, Office of Public Housing began working with the Authority to lease more vouchers, and the Authority took other actions to resolve the other deficiencies.

However, we found deficiencies in 9 of 10 randomly selected program participant files.  Each of the files contained one or more deficiencies, including payment calculation errors, incorrect payments, and missing documents to support participant and unit eligibility.  These errors occurred because the Authority did not maintain knowledgeable in-house program staff, did not maintain continuity when it switched between contractors and in-house staff to process program files, and did not ensure staff followed the Housing Choice Voucher program policies and procedures.  As a result, the Authority overpaid $2,139 in assistance and required participants to overpay $22.  Further, it paid $21,426 for participants and units with unsupported eligibility and made an additional $53 in unexplained payments.  We found no deficiencies in the Authority’s low-rent program.

We recommend that the Authority (1) repay $2,139 for incorrect housing assistance payments, (2) reimburse $22 to a family that was overcharged, (3) support or repay $21,479, and (4)  take steps to ensure staff follows procedures when calculating rent and maintain adequate supporting documentation.