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We audited the State of Connecticut Department of Social Services’ (agency) administration of its housing quality standards program for its Section 8 Housing Choice Voucher program (Voucher program) as part of our fiscal year 2009 audit plan. The agency was selected based upon our analysis of risk factors relating to rental housing authorities in Region 1. The audit objectives were to determine whether (1) Section 8 housing units met HUD’s housing quality standards, (2) housing inspections were performed in a timely manner, (3) housing assistance payments were properly abated when units did not meet standards, (4) landlords were notified of failing inspection results, and (5) the quality control reviews of inspections were adequately performed in support of the agency’s Section Eight Management Assessment Program (SEMAP) scores. This is the third and final audit of the agency.

The agency did not adequately ensure that its Section 8 housing units met HUD’s housing quality standards. Of the 67 program units statistically selected for inspection, 53 failed inspection, and 34 were materially noncompliant with housing quality standards. In addition, the agency did not always perform its inspections in a timely manner, properly abate the housing assistance payments when repairs were not made as required or notify the owners of inspection results in a timely manner. The agency also did not have an adequate housing quality standards quality control process.

We recommend that the Director of HUD’s Boston Office of Public Housing require the agency to strengthen controls to ensure that it follows HUD’s procedures for conducting inspections and performing Section 8 quality control inspections to ensure that units meet HUD’s housing quality standards to prevent $22 million in program funds from being spent annually on units that fail to materially meet HUD’s housing quality standards. In addition, the agency should be required to reimburse its program from nonfederal funds $62,459 for units that remained in noncompliance with housing quality standards and were not properly abated.