HUD recently completed a quality control study to provide national estimates for the accuracy of local compliance with Federal regulations for determining public housing and Section 8 rent subsidies. To measure the accuracy of calculation, HUD first made independent determinations of tenants' incomes, rents, and subsidies based on adherence to all HUD guidelines and then compared these determinations to those made by local public housing authorities (PHAs) and Section 8 staff. Summarizing the study's findings, Quality Control for Rental Assistance Subsidies Determinations estimates that tenants underpaid $1.7 billion in annual rent—nearly three times the amount that tenants overpaid. The report highlights findings about the severity, costs, and sources of subsidy errors and recommends corrective actions to enhance HUD oversight and local compliance. The study finds that localities often made substantial errors in rent and income determinations that resulted in incorrect levels of HUD rental assistance subsidies. Errors are defined as any rent calculation or eligibility determination that differs from what would have occurred if the locality had followed all of HUD's income certification and rent calculation requirements. The two most common local problems are calculation errors and the failure to verify tenants' income and expense information. Although obtaining income verification is often difficult, some program sponsors do a better job than others, and the report concludes that it is reasonable to expect all program sponsors to have a success rate as high as that of the current top performers. The study finds that thorough, detailed interviews with tenants allow local staff to identify additional sources of income and expenses and calculate rental subsidies more accurately. The report recommends changes at the national and local level to improve rental subsidy determinations. Suggested improvements at the Federal level include:
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