New Bedford Housing Authority
April 23, 2014 · Read the full official report (PDF) ↗
Published April 23, 2014 Audit covers January 1, 2012 – March 31, 2013 Under Suzanne M. Bump · 2011–2023
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“Based on our audit, we have determined that for the period January 1, 2012 through March 31, 2013, except for the issues addressed in the Detailed Audit Results and Findings section of this report, the Authority maintained adequate internal controls and complied with applicable laws, regulations, and policies and procedures in the areas reviewed.”
Read the plain-English breakdown
This is a Massachusetts State Auditor performance audit of the New Bedford Housing Authority covering January 1, 2012 through March 31, 2013.
“In accordance with Chapter 11, Section 12, of the Massachusetts General Laws, the Office of the State Auditor has conducted an audit of certain activities of the New Bedford Housing Authority for the period January 1, 2012 through March 31, 2013.”
Auditors checked whether the housing authority had proper controls and followed the rules for state-aided housing programs.
“The objectives of our audit were to review and analyze the adequacy of the Authority’s internal controls and to evaluate its compliance with laws, rules, and regulations applicable to state-aided housing programs in the areas reviewed.”
Weak controls can make public property harder to track and increase the chance that items are lost, stolen, or misused without being noticed.
“Further, the lack of an up-to-date and reconciled inventory record creates an undue risk of undetected loss, theft, or misuse because it prevents the Authority from reliably accounting for items’ whereabouts.”
If you live in or are waiting for public housing, the biggest practical issue is vacancy turnaround: delays can mean people wait longer for housing and the authority loses rent money.
“In addition, individuals on the waiting list were not provided with housing in a timely manner.”
The authority fixed one older problem with lease paperwork, improved some areas, but still had unresolved problems from the prior audit.
“We also found that the Authority had resolved one of the issues noted in our prior audit report and was executing lease addenda for tenants eligible for continued occupancy and that it had made improvements toward resolving its problems with vacancy turnaround, but still had not resolved issues with DHCD recordkeeping requirements for master files and waiting-list ledgers and the appropriate housing of tenants, which are described in detail in this report.”
The report tells the authority to fix tax reporting, improve inventory controls, speed up reoccupying vacant units, use approved application and ledger processes, and move tenants into properly sized units when possible.
“The Authority should take measures to reduce its average turnaround time for reoccupying vacant units to comply with DHCD’s 21-day guideline.”
The authority manages hundreds of public housing units and vouchers, so problems in its controls and housing processes can affect many residents and applicants.
“The Authority currently manages and oversees 389 elderly housing units, 168 family units, 330 veterans’ units, and 16 special-needs units.”
“Master file ledger” means the official list of people applying for state-aided public housing, kept in chronological order across state housing programs.
“The master file ledger is a ledger listing information on applicants for state-aided public housing in chronological order for all state housing programs.”
4 figure(s) pending source verification - not shown
What the Auditor checked
- Partially Determine whether the Authority addressed prior audit issues and improved controls over employee reimbursements after a prior theft of federal funds.
What the Auditor found
Why it matters: The executive director’s taxable compensation was understated for calendar year 2012.
Standard: IRS Publication 15-B, Employer’s Tax Guide to Fringe Benefits ( IRS Publication 15-B, “Employer’s Tax Guide to Fringe Benefits” )
2 recommendations
- Calculate the taxable fringe benefit attributable to the leased vehicle and applicable life insurance coverage, report it to payroll for W-2 inclusion, and submit amended W-2 forms for affected prior years.agency: already implemented
- Add fringe-benefit calculations and payroll-service communication to written policies and procedures.
Agency response & Auditor reply
Agency: "Since this issue was brought to our attention, the benefits have been included on the Executive Director’s W2."
Why it matters: Inventory records could not be relied on and there was an undue risk of undetected loss, theft, or misuse.
Standard: Section 15(D) (Inventory of Equipment) of the DHCD Accounting Manual for State-Aided Housing Programs ( Section 15(D) (Inventory of Equipment) of the DHCD Accounting Manual for State-Aided Housing Programs )
4 recommendations
- Conduct an annual physical inventory and reconciliation of state-owned assets, including refrigerators and stoves, with all required DHCD inventory information.agency: disagreed
- Maintain a perpetual inventory list and update it when inventory is acquired or disposed of.
- Affix an identification tag to each item.
- Keep employees responsible for inventory current on DHCD requirements.
Agency response & Auditor reply
Agency: "In response to finding number two, I would disagree with your conclusion that the Housing Authority has not conducted an annual inventory."
Why it matters: The Authority did not realize potential rental income, and applicants on the waiting list were not provided housing in a timely manner.
Standard: DHCD Property Maintenance Guide 21-working-day vacancy turnaround guideline ( DHCD Property Maintenance Guide )
2 recommendations
- Reduce average turnaround time for reoccupying vacant units to comply with DHCD’s 21-day guideline.agency: partially agreed
- Document reasons for delays and seek DHCD waivers for units that cannot reasonably be reoccupied within the standard timeframe.
Agency response & Auditor reply
Auditor: "Our audit only included an analysis of the turnaround time for reoccupying vacant state housing units."
Why it matters: Using unapproved electronic forms and ledgers can weaken safeguards over applicant order and eligibility information.
Standard: 760 Code of Massachusetts Regulations 5.16(2) and 760 Code of Massachusetts Regulations 5.05 ( 760 Code of Massachusetts Regulations 5.05 )
1 recommendation
- Use approved application forms and maintain handwritten master file and waiting list ledgers in a DHCD-approved format.agency: disagreed
Agency response & Auditor reply
Agency: "The Housing Authority has been utilizing a computerized waiting list for many years."
Auditor: "However, to date, DHCD has not granted a waiver to the Authority for the use of its electronic ledgers and therefore, the Authority is out of compliance with the regulations."
Prior findings revisited
"Our current revealed that the Authority had introduced new lease addendum forms since our prior audit."