We audited Vineville Christian Towers’ (project) Rental Assistance Demonstration Program (RAD) conversion in accordance with our annual audit plan. Our audit objective was to determine whether the project’s RAD conversion to the Section 8 Project-Based Voucher Program was completed in accordance with the U.S. Department of Housing and Urban Development’s (HUD) requirements; specifically, whether Christian Church Homes of North California (owner) ensured that the project’s RAD conversion was accurate and supported.
The owner did not ensure that the project’s RAD conversion was accurate and supported. Specifically, the owner did not ensure that (1) the converting units were for qualified tenants who received tenant protection assistance before the submission of the RAD application and had not vacated the units and (2) the RAD conversion was supported with tenant protection assistance based on an adequate housing conversion action. This condition occurred because the owner was not familiar with the requirements related to the RAD conversion and tenant protection assistance. As a result, it (1) improperly executed the Section 8 Project-Based Voucher Program housing assistance payments contract for 90 units at the project, (2) improperly received more than $485,000 in housing assistance, and (3) may have provided improper certifications to HUD on program compliance.
We recommend that the Director of HUD’s Atlanta, GA, Office of Public and Indian Housing require the owner to (1) cancel the project’s contract resulting from the RAD conversion, (2) reimburse its administering public housing agency more than $485,000 from nonproject funds, and (3) develop and implement procedures and adequately train its staff to help ensure compliance with program requirements. We also recommend that HUD’s Associate General Counsel for Program Enforcement and Departmental Enforcement Center take and pursue appropriate enforcement and administrative actions against the owner.
Recommendations
Public and Indian Housing
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Status2020-AT-1001-001-AOpenClosedClosed on September 29, 2020
Cancel the Section 8 Project-Based Voucher Program housing assistance payments contract for 90 units improperly converted under RAD. The owner should work with HUD and the Authority to protect the tenancy of the affected tenants at the time of contract cancellation.
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Status2020-AT-1001-001-BOpenClosed$485,475.00Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Closed on March 09, 2021Reimburse HUD’s Section 8 program administered by the Authority $485,475 in housing assistance payments from nonproject funds for the improper issuance of tenant protection assistance and an improper RAD conversion to the Project-Based Voucher Program for the 90 units.
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Status2020-AT-1001-001-COpenClosedClosed on December 09, 2020
Develop and implement procedures to ensure that when tenant protection assistance is requested as a result of a housing conversion action, the forms HUD-50059 and or tenant profiles is generated only based on a completed action and that the forms or profiles are provided to HUD instead of the Authority.
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Status2020-AT-1001-001-DOpenClosedClosed on September 16, 2020
Provide adequate training to staff associated with administering tenant protection and project-based assistance to help ensure compliance with program requirements.
General Counsel
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Status2020-AT-1001-001-EOpenClosedClosed on March 18, 2021
Take appropriate enforcement actions against the responsible parties and pursue civil action against the owner for improperly certifying to the eligibility of the project residents.
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Status2020-AT-1001-001-FOpenClosedClosed on March 31, 2020
Pursue administrative actions, as appropriate, against the responsible parties for the improper certification included in form HUD-50059 and the Section 8 project-based voucher housing assistance payments contract.