We recommend that the Deputy Assistant Secretary for Public Housing and Voucher Program follow departmental clearance procedures and issue clarification to public housing agencies to explain what is being certified to in the Application.

We recommend that the Deputy Assistant Secretary for Public Housing and Voucher Programs require public housing agencies to sign the certifications on form HUD-52723 or remove the certification.

Review the Authority’s non-Sound Families Initiative project-based voucher projects to determine whether it executed the agreement with the owners of new construction projects.

Assist the Authority in obtaining any training needs identified by the review in recommendation 1A.

Require the Authority to submit evidence and its board of directors to certify to the Director of the Seattle Office of Public Housing that it has complied with regulatory requirements for each step of the project-based voucher process for each new project-based voucher project until such time as the Director of the Seattle Office of Public Housing believes the Authority understands and is consistently complying with the requirements.

Reimburse its program $373,860 ($302,638 in ineligible housing assistance payments $63,643 in associated administrative fees $7,579 in program funds paid to the contractor) from non-Federal funds for the inappropriate payments cited in this finding.

Seek retroactive approval or reimburse its program $358,237 ($339,908 in housing assistance payments $18,329 in program funds paid to the contractor) for the housing quality standards inspections of units owned by entities substantially controlled by the Authority, completed by contractors that were not approved by HUD.

Implement adequate procedures and controls to ensure that the Authority complies with HUD’s requirements for program conflicts of interest, including but not limited to ensuring that (1) its staff does not complete inspections for units owned by entities substantially controlled by the Authority, (2) its staff is appropriately trained and familiar with HUD’s requirements for units owned by entities it substantially controls, and (3) future contracts to perform housing quality standards inspections for program units owned by entities substantially controlled by the Authority are with a HUD-approved independent third party.

Reimburse its program $163,316 from non-Federal funds ($29,074 in housing assistance due to calculation errors 74,957 due to inappropriate voucher sizes, payment standards, and utility allowances $18,141 $41,144 in administrative fees) for the inappropriate payments cited in this finding.

Reimburse the appropriate households $9,280 ($2,588 in housing assistance underpayments due to calculation errors $6,692 due to inappropriate voucher sizes, payment standards, and utility allowances) from program funds for the inappropriate underpayments cited in this finding.

Support or reimburse its program $2,533 from non-Federal funds for the unsupported payments of housing assistance cited in this finding.

Pursue collection from the applicable households or reimburse its program $470 from non-Federal funds for the overpayment of housing assistance due to unreported or underreported income.

Reimburse the appropriate households $3,178 from non-Federal funds for the rent amount paid in excess of 40 percent of the adjusted monthly income for the units that were not affordable.

For the five household’s residing in units that were not affordable, renegotiate the rent to the owners or require the households to move into units that are affordable.

Implement adequate procedures and controls to ensure that (1) housing assistance payments are appropriately calculated and supported, (2) households reside in units that are affordable, and (3) repayment agreements are created to recover overpaid housing assistance when unreported income is discovered during the examination process to ensure that $108,214 ($103,841 in potential overpayments $4,373 in potential underpayments of housing assistance) in program funds is appropriately used for future payments.

Evaluate its quality control process to ensure that calculation, voucher size, payment standard, and utility allowance errors are identified and appropriately corrected.

Ensure that its staff is properly trained and familiar with HUD’s and its own requirements regarding program housing assistance calculations, applying appropriate voucher sizes, and when to apply changes to households’ payment standards and utility allowances.

Review all of the remaining program household files to determine whether appropriate voucher sizes were provided and payment standards and utility allowances were applied and updated appropriately. The Authority should conduct special recertifications for the households with vouchers that do not comply with HUD’s requirements and the Authority’s administrative plan, issue the appropriate voucher sizes, and apply updated payment standards and utility allowances as appropriate.

Restrict the Authority from administering other HUD-funded programs until it substantially improves its program administration to ensure compliance with applicable requirements based on the findings cited in this audit report, absent sufficient documentation provided by the Authority.

We recommend that the Director of HUD’s Newark Office of Public Housing to require the Authority to provide documentation to show that the $800,439 paid for supplies and services purchased under the intergovernmental agreement for capital improvement projects was reasonable or reimburse its Capital Fund from non-Federal funds for any amount that it cannot support or that is not considered reasonable.