Easton Housing Authority
June 15, 2012 · Read the full official report (PDF) ↗
Published June 15, 2012 Audit covers January 1, 2008 – December 31, 2010 Under Suzanne M. Bump · 2011–2023
source
“Based on our review, we have concluded that, except for the issues addressed in the Audit Results section of this report, during the period January 1, 2008 through December 31, 2010, the Authority maintained adequate management controls and complied with applicable laws, rules, and regulations for the areas tested.”
Read the plain-English breakdown
This is a Massachusetts State Auditor review of the Easton Housing Authority, which runs public housing for elderly, handicapped, and family residents in Easton.
“The Easton Housing Authority is authorized by and operates under the provisions of Chapter 121B of the Massachusetts General Laws, as amended.”
The state audited the authority after leadership changed, to give the board and new executive director a clear picture of the agency’s finances, records, controls, and legal compliance.
“The audit was conducted due to the resignation of the former Executive Director and the hiring of a new Executive Director.”
Weak controls make it harder to know whether money is being spent properly, records are accurate, assets are protected, and rules are being followed.
“Without such documented internal control systems, there is inadequate assurance that Authority goals and objectives are met; resources are used efficiently, effectively, and in compliance with applicable laws, regulations, and policies; assets are safeguarded against potential waste, loss, and misuse; and financial data is maintained, reported, and fairly disclosed in reports.”
For residents and applicants, the audit matters because it points to delays in filling apartments, maintenance problems, and conditions that could affect safe and sanitary housing.
“By reducing its average turnaround time for reoccupying vacant units and complying with DHCD’s 21-day unit turnaround timeframe, the Authority will not only improve its financial condition by maximizing its rental income, but also more expeditiously house its waiting list applicants.”
The main problem was not one isolated mistake; auditors found many management and financial practices that needed stronger written policies, better documentation, and closer oversight.
“Our review disclosed that the Authority needs to improve its controls over financial and management practices in a number of areas.”
The report tells the authority to fix its controls, improve maintenance and vacancy practices, follow procurement and accounting rules, and seek state help where more funding or staffing is needed.
“The Authority should familiarize its maintenance staff with the provisions of the preventive maintenance plan so that it can become an important part of maintenance operations.”
The findings are significant because the authority had unresolved issues from an earlier audit and auditors found that some problems, such as slow reoccupancy of vacant units, had continued or worsened.
“Our follow-up review disclosed that although the Authority has taken some corrective action to remedy these issues, further improvements are needed.”
An “internal control system” means the basic rules, records, approvals, and checks that help an agency spend money properly, protect assets, and keep accurate information.
“Generally accepted accounting principles (GAAP) advocate that entities such as the Authority establish and implement an adequate internal control system.”
18 figure(s) pending source verification - not shown
What the Auditor checked
- Partially Did the Authority maintain adequate management controls and comply with applicable laws, rules, and regulations for the areas tested?
What the Auditor found
Why it matters: The Authority lost rental income and delayed housing for waiting list applicants.
Standard: DHCD’s Property Maintenance Guide indicates that housing authorities should reoccupy units within 21 working days of vacancy. ( DHCD’s Property Maintenance Guide )
1 recommendation
- The Authority should renovate vacant units more promptly, document delays, monitor turnaround compliance, seek DHCD waivers when needed, and appeal to DHCD for maintenance staffing funds if needed.agency: already implemented
Agency response & Auditor reply
Agency: "Those units have been rehabbed and the maintenance workers are now turning over units in adequate time to allow for re-occupancy within the DHCD 21-day turnaround timeframe."
Why it matters: The Authority may not maintain properties in safe and habitable condition.
Standard: DHCD’s Property Maintenance Guide and the Authority’s preventive maintenance plan.
1 recommendation
- The Authority should train maintenance staff on the plan, have staff acknowledge it, evaluate staff weaknesses, improve communication, and appeal to DHCD for additional maintenance funding as needed.agency: agreed
Agency response & Auditor reply
Agency: "We have instituted an on-call maintenance policy and plan to institute a monthly preventive maintenance plan."
Why it matters: There was inadequate assurance that goals were met, resources were used properly, assets were safeguarded, and financial data was reliable.
Standard: Generally accepted accounting principles advocate an adequate internal control system. ( Generally accepted accounting principles )
Why it matters: The Authority risked unauthorized, unsupported, or unnecessary expenditures.
Standard: Board oversight and approval of expenditures.
1 recommendation
- The Authority should generate official warrant reports from accounting software, include all expenditures and totals, obtain signed board approval, include approved expenditures in minutes, and avoid unnecessary sales taxes.agency: already implemented
Agency response & Auditor reply
Agency: "All actual vendor bills are available for the Board to review."
Why it matters: The Authority risked paying inaccurate or unsupported reimbursements.
Standard: Written reimbursement policies and supporting documentation.
1 recommendation
- The Authority should develop reimbursement policies, update forms, require business purpose and addresses, require support, signatures, board approval for the Executive Director, and verify accuracy before payment.agency: agreed
Agency response & Auditor reply
Agency: "All future reimbursements will require the approval of the Executive Director and will not be paid without proper documentation."
Why it matters: There was no assurance over contract amounts, payments, and change orders.
Standard: Section 6-8 of DHCD’s Accounting Manual. ( Section 6-8 of DHCD’s Accounting Manual )
1 recommendation
- The Authority should maintain contract registers for current and future modernization projects, DHCD should review projects without registers, and the Authority should maintain orderly files.agency: already implemented
Agency response & Auditor reply
Agency: "Contract registers are now being maintained for all modernization projects."
Why it matters: Financial records did not reflect correct asset values and inventory was not adequately safeguarded.
Standard: DHCD’s Accounting Manual, Section 15(D). ( DHCD’s Accounting Manual, Section 15(D) )
1 recommendation
- The Authority should establish a comprehensive inventory listing, tag all furniture and equipment, conduct annual physical inventory counts, and reconcile inventory to accounting records.agency: agreed
Agency response & Auditor reply
Agency: "The Authority intends to update all inventory records and maintain an automated system."
Why it matters: There was no assurance that quarterly insurance amortization was correct.
Standard: DHCD’s Accounting Manual, Section 6-9. ( DHCD’s Accounting Manual, Section 6-9 )
1 recommendation
- The Authority should maintain an insurance register for all insurance policies, and DHCD should review amortization for policies without registers.agency: already implemented
Agency response & Auditor reply
Agency: "An insurance register is now being maintained."
Why it matters: Amounts owed to and by former tenants were not properly resolved.
Standard: DHCD guidelines for vacated tenants with balances owed.
1 recommendation
- The Authority should develop written policies and procedures, write off uncollectible balances with board approval, and reimburse tenants owed money.agency: agreed
Agency response & Auditor reply
Agency: "All money owed to tenants has been credited to their accounts."
Why it matters: The Authority’s credit card was not adequately safeguarded against possible misuse.
Standard: DHCD’s Accounting Manual for State-Aided Housing programs, Section 8. ( DHCD’s Accounting Manual for State-Aided Housing programs, Section 8 )
1 recommendation
- The Authority should establish credit card policies requiring proper documentation, Authority-related expenses, and Board approval.agency: already implemented
Agency response & Auditor reply
Agency: "Currently all expenditures are invoiced to the Authority and paid by check."
Why it matters: Tenants’ rents may have been improperly calculated.
Standard: 760 CMR 6 and DHCD regulations. ( 760 CMR 6.04 )
1 recommendation
- The Authority should train staff, consult DHCD on minimum monthly rent policy, ensure compliance with 760 CMR 6, and keep required documentation in tenant files.agency: agreed
Agency response & Auditor reply
Agency: "The Authority has since changed the tenant’s redetermination date to the anniversary of the tenant’s tenancy and will continue with biannual recertifications."
Why it matters: Laundry receipts were at risk of loss or misuse.
Standard: Formal written policies and procedures for collection, deposit, and use of laundry receipts.
1 recommendation
- The Authority should establish formal written policies and procedures for collection, deposit, and use of laundry funds.agency: already implemented
Agency response & Auditor reply
Agency: "A formal written policy and procedure will be established."
Why it matters: A tenant may have received preferential treatment and another tenant may have been denied availability.
Standard: 760 CMR 4.04(g). ( 760 CMR 4.04(g) )
1 recommendation
- The Authority should forward all proposed transfers or admissions of tenants related to Authority personnel to DHCD for approval.agency: agreed
Agency response & Auditor reply
Agency: "The employee referenced had been suspended without pay for a period of five working days and has since received tenant selection training."
Why it matters: The Authority could be at risk for damages or injuries during contractor work.
Standard: DHCD requirements for contractor certificates of insurance.
1 recommendation
- The Authority should update policies and require contractors to submit certificates of insurance before work is performed.agency: already implemented
Agency response & Auditor reply
Agency: "All contractors conducting work for the Authority are now required to provide a certificate of insurance prior to conducting any work or repairs to the Authority’s properties."
Why it matters: The Authority could be subject to penalties and interest.
Standard: IRS publication Circular E, Employer’s Tax Guide.
1 recommendation
- The Authority should correct 2009 IRS filings, issue Forms 1099-MISC to vendors, and ensure future forms are timely filed.agency: agreed
Agency response & Auditor reply
Agency: "The Authority recognizes that 1099-MISC forms were not sent to vendors for the 2009 calendar year."
Why it matters: There was inadequate assurance that the Authority received the best possible price.
Standard: Chapter 30B and DHCD procurement guidelines. ( Chapter 30B of the General Laws; DHCD’s Accounting Manual, Section 16 )
1 recommendation
- The Authority should comply with Chapter 30B procurement requirements, ensure board review before applicable transactions, and have its Contract Officer or designee certified through MCPPO.agency: agreed
Agency response & Auditor reply
Agency: "[The] new Executive Director . . . is certified through the Massachusetts Inspector General’s Office as a Massachusetts Certified Public Purchasing Official (MCPPO)."
Why it matters: Private and confidential information could be compromised.
Standard: 705 CMR 8.04. ( 705 CMR 8.04 )
1 recommendation
- The Authority should keep confidential information such as tenant applications in locked file cabinets in a secured building.agency: already implemented
Agency response & Auditor reply
Agency: "A new alarm system has been installed in the office and maintenance shop."
Why it matters: Tenants may not have safe, decent, and sanitary housing.
Standard: 105 CMR 410, Minimum Standard of Fitness for Human Habitation. ( 105 CMR 410 )
1 recommendation
- The Authority should appeal to DHCD for funding to address inspection issues and hire additional maintenance staff, and DHCD should provide sufficient funds timely.agency: already implemented
Agency response & Auditor reply
Agency: "In March of 2011 all of the Authority’s units were inspected . . . ."
Why it matters: Failure to repair and follow pumping schedules could cause further septic failure and increase wastewater treatment plant costs.
Standard: DEP Consent Order and 314 CMR 5.00 and 6.00. ( 314 CMR 5.00 and 6.00 )
1 recommendation
- The Authority should obtain septic tank pumping pricing, file the June 1, 2010 DEP report, and appeal to DHCD for repair funding.agency: agreed
Agency response & Auditor reply
Agency: "The Authority is currently working with DHCD to hire an engineer to draft specifications to build an on-site 4.5 million dollar wastewater treatment plant in compliance with the DEP order."
Why it matters: Pet deposit liabilities and records were inaccurate and tenant funds were not properly controlled.
Standard: DHCD’s Pet Guidelines for State-Aided Elderly Housing and DHCD’s Accounting Manual. ( DHCD’s Pet Guidelines for State-Aided Elderly Housing (October 1995); DHCD’s Accounting Manual )
1 recommendation
- The Authority should treat pet deposits as security deposits, record them properly, reconcile general ledger balances to pet deposit records, and post and enforce pet rules.agency: agreed
Agency response & Auditor reply
Agency: "The Authority will be complying with their pet regulations & policy and reconcile the pet account and will set up [the] pet account as security deposits."
Why it matters: The Authority could not efficiently track vendor payments or ensure only authorized payments occurred.
Standard: DHCD’s Accounting Manual, Section 18, and Chapter 121B, Section 29, of the General Laws. ( DHCD’s Accounting Manual, Section 18; Chapter 121B, Section 29, of the General Laws )
1 recommendation
- The Authority should file invoices by vendor or expenditure type and ensure correct check numbers are entered in accounting software.agency: already implemented
Agency response & Auditor reply
Agency: "Vendor files were setup for all vendors and landlords."
Why it matters: There was no assurance that purchases were necessary or obtained at the best price.
Standard: The Authority’s written purchase order policies and procedures. ( Authority written purchase order policies and procedures )
1 recommendation
- The Authority should follow its written purchase order policy and ensure Executive Director approval before purchases occur.agency: already implemented
Agency response & Auditor reply
Agency: "The purchase order policy is now being adhered to and all purchases now require a signed purchase order from the Executive Director prior to making the purchase."
Why it matters: Repairs were not timely, posing safety and health risks to tenants.
Standard: The Authority’s maintenance work order policies and procedures.
1 recommendation
- The Authority should appeal for funding for additional maintenance workers or contractors and update work order policies to include problem type, materials, employee time, and contractors.agency: already implemented
Agency response & Auditor reply
Agency: "A temporary maintenance worker had been hired."
Why it matters: The Authority lacked assurance on tax withholding, training, pay increases, job duties, and work authorization.
Standard: Required personnel documentation including tax forms, employment eligibility verification, training records, performance evaluations, pay increase notices, and job descriptions.
1 recommendation
- The Authority should review and update employee files and ensure required forms, training records, evaluations, pay notices, and job descriptions are included.agency: already implemented
Agency response & Auditor reply
Agency: "All employee folders are now complete with all required documents enclosed within."
Why it matters: Compensated absences liability was higher than allowed and unsupported leave cost the Authority money.
Standard: The Authority’s written personnel policies for vacation and sick leave accruals. ( Authority written personnel policy; Authority written personnel policy )
1 recommendation
- The board should update vacation policy accrual timing, follow written policies, allocate sick time monthly, and not allow excess leave carryover without board approval.agency: already implemented
Agency response & Auditor reply
Agency: "All employee leave accrual policies are now adhered to."
Prior findings revisited
"Our follow-up review disclosed that although the Authority has taken some corrective action to remedy these issues, further improvements are needed, as discussed below:"
More audits of this entity
Other Office of the State Auditor reports on Easton Housing Authority , including the prior audits referenced above.
- Easton Housing AuthorityHousing Authority · July 30, 2015