verification verification reports income reports intro repayment agreement change 4 | hud handbook...

Verification

Verification Reports

Income Reports

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Repayment Agreement

Change 4 | HUD Handbook 4350.3

2321 Weldon Parkway St. Louis, MO 63017 P: 866-760-6000Zeffert & Associates2321 Weldon Parkway St. Louis, MO 63017 P: 866-760-6000

Zeffert & Associates

4350.3CHANGE 4 REVISION UPDATES

HUD RequirementsPresented by Rose Dubin

Zeffert & Associates

CONTACT US2321 Weldon Parkway St. Louis, MO 63146

Phone: 866-760-6000Email: [email protected]

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2321 Weldon Parkway St. Louis, MO 63017 P: 866-760-6000Zeffert & Associates

Enterprise Income Verification System (EIV) Required since 1/31/10 Third party source of employment and

income information for Wages, SS and SSI Identifies issues or discrepancies

impacting assistance Reduces administrative and subsidy

payment errors Insures that the right benefits are given

to the right person

Purpose is to ensure that the right subsidy is going to the tenant and to eliminate fraud

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EIVIntro

Data is collected from: Social Security Administration ( SSA) Dept. of Health and Human Services (HHS)State Workforce Agency (SWA)National Directory of New Hires (NDNH)New Hires: Quarterly Wages, Quarterly unemployment

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EIVIntro

Data UpdatesSocial Security Administration ( SSA)

COLA is not reflected in EIV until the end of the calendar year. AR effective after 4-1 must reflect the benefit amount with the COLA included

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EIVIntro

Applies to HUD Housing Programs Does not apply to LIHTC or RHS Section

515 In blended programs, EIV can only be

used for HUD Program View HUD Notice H2013-06

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EIVIntro

Data Updates National Directory of New Hires (NDNH) – Health and Human Services.

Various agency database share information based on key information “ Personal Identifiers”

Last Name DOB SSN

UPDATE CHG 4

Use of EIV to project anticipated income: • EIV provides 3rd party verification of the existence of

employment , not the basis of income calculations.• EIV 3rd party verifies the existence of SS payments AND is

used for income calculations

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Policies & Procedures Intro

Owner/Agents are required to develop a Policies and Procedures Manual to govern the use of the EIV system. These are separate from your Tenant Selection Plan.These procedures should address:

a. Authorized use of the EIV system;b. How to handle security breaches; andc. Destruction of EIV data.d. Frequency of printing EIV Reports based on HUD’s recommendations.

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Confidentiality Intro

Only necessary information should be gathered in file. Severe HUD and civil penalties apply if information is misused or disclosed to unauthorized persons.

Examples of unauthorized persons:• Employees who do not “need to know”• Other residents

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Who Can See EIV DataEIV data for an adult household member cannot be shared without consent of the adult Including other household members. However, the total income and how the rent was calculated MAY be discussed with the head of the household.

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Who Can See EIV DataA tenant may have someone assist them with the recert process. (Service Coordinators, translators, and assistants for the elderly/disabled, guardians, power of attorneys or other family members).• They may sign a consent for that person to see their

personal EIV data only. Exhibit 9-4 is a sample release form.

Limited allowable official disclosure includes CAs and IPAs hires by the owner to perform financial audits and OIG investigators.

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Security Intro

Physical Safeguards Steps must be taken to ensure that EIV data is safe whether stored electronically (computer) or in hard copy. (printed.

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Security Intro

Hardcopy EIV DataDo not leave printed EIV data unattended. Printing: Retrieve EIV document when they are printed. Faxing: Only under extreme circumstance can EIV be

sent over the fax. In these extreme circumstances confirm there is someone waiting and ready to retrieve the fax as soon as it is received (printed).

Mailing: EIV data must not be mailed to Independent Public Auditor offices.

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Security IntroComputer SecurityThe EIV system will time out after 30 minutes of inactivity, this automatic safeguard should not be the only security measure taken.• Use a password protected screensaver and lock their

computer when leaving their workspace.• Do not leave a computer unattended with EIV data

displayed on the screen• Exit the EIV system be exited using the “X” at the top

right of the screen which will remove the user from the entire WASS system.

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Security IntroSecurity TrainingAll EIV users and staff who view the data must adhere to the “Rules of Behavior” (ROB). This is available at the HUD website. This may include auditors.• Required online Cyber-Awareness Challenge training

annually for EIV staff. Certificates of Completion must be retained.

• Passwords can never be shared

Burn, shred, pulverize

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Required Forms Intro

All adult household members must sign the 9887 9887A at initial and annual certifications, or assistance must be denied. Must be signed at move-in and each recertification.HUD-9887 Fact Sheet Resident Rights and Responsibilities Brochure EIV & You Brochure Owner Created Verification Forms

Must make clear: 1) who will be asked and 2) to whom the form will be returned

3) must contain Title 18 language on verification form

•Must include statement in Figure 5-5 / 5-59

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EIV & MOR IntroA list of required EIV documentation will be provided by the reviewer prior to the Management & Occupancy Review (MOR). This list generally will include: An initial and current Approved EIV Coordinator Access

Authorization form, with supporting recertification documents (CAAF)

An initial and current Approved EIV User Access Authorization form, with supporting recertification documents (UAAF)

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EIV & MOR Intro

A list of required EIV documentation will be provided by the reviewer prior to the Management & Occupancy Review (MOR). This list generally will include: Owner’s approval letter authorizing coordinator access to EIV EIV Policies and Procedures Manual Signed copies of the EIV rules Of Behavior for individuals

without access to the EIV system. Copy of TRACS Rules of Behavior, signed and dated.

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Methods of VerificationUpfront-income verification (UIV). UIV is verification of income through an independent source that ” systematically and uniformly maintains income information in a computerized form”

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A. UIV VerificationThere are two types of UIV: 1) Using HUD’s EIV system for tenants (not available for applicants). (REQUIRED)Must be used as the 3rd party source employment and income information of tenants for all

• Recertifications • Interims

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There are two types of UIV: 2) UIV using non-EIV system to verify income: (Optional)

Of applicants; When no employment or income is available in EIV; or For other types of income received by the family

Examples of Non- EIV UIV• The Work Number • Other state government databases, if

available, to verify income

A. UIV VerificationVerifications

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Written Third Party VerificationExamples

• Pay stubs• Payroll summary report• Employer notice/letter of hire/termination• SSA benefit letter (if tenant does not agree)• Bank statements• Child support payment stubs• Welfare benefit letters

and/or printouts

B. Written 3rd Party Verifications

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B. Written 3rd Party The following must be considered when using tenant provided documentation: Is the document current? Is the documentation complete? Paystubs most be the

recent four to six, consecutive pay. Actual paychecks or copies of paychecks should never

be used. Is the document an unaltered original? Photocopied

documents generally cannot be assumed to be reliable.

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B. Written 3rd Party 2. “Written documentation sent directly by the third-party source by mail or electronically by fax, email or internet.”• Requested directly from the third party• Fax, email, view internet site, or mail all requests.

Repeat if necessary. Due diligence necessary with verifications. Ask yourself: Is it identifiable as coming from the source? Examples: fax number supplied on faxes, web address

on bottom of internet verification, company name in email address.

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B. Written 3rd PartyWhen documenting verbal clarification:Create a Clarification form which includes:• Name, position and contact info of 3rd party• Information requested and the information

provided• Name, date and time of

conversation• Signature of person collecting information

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C. Oral 3rd Party Be Certain you are speaking with the appropriate person• Only complete oral verification by calling the verification

source; do not accept verification from the source calling the property management office.

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http://www.google.com/imgres?biw=1600&bih=731&tbm=isch&tbnid=tnWMf4miKdWbfM:&imgrefurl=http://computercliparts.net/cell-phone-clip-art/&docid=OiTo-y-2fGKACM&imgurl=http://computercliparts.net/wp-content/uploads/2013/02/cell-phone-clip-art-AT-3.png&w=306&h=591&ei=dLMeUrr9CoORygGD1YGwAg&zoom=1&ved=1t:3588,r:66,s:0,i:294&iact=rc&page=3&tbnh=172&tbnw=89&start=62&ndsp=36&tx=36&ty=81

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D. Family CertificationOnly to be used if income cannot be verified by any of the above methods. Document why third-party verification was not available. Include in the file: • A note explaining why 3rd party verification was not

obtainable• Date-stamped original request• Record of Follow-up efforts• Note after 4 weeks of efforts without response

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Verifications are Valid…120 days from the date of receipt by the owner, *not the effective date of the 50059.If verifications are more than 120 days old *from the date of receipt by the owner*, the owner must obtain new verifications.Note: this is rarely exactly 4 months

Time limits do not apply to information that does not need to be re-verified, such as:• Age;• Disability status;• Family membership; or• Citizenship status.

Verifications EXAMPLEJolene Recertification is effective 7/1/2014The manager sends notice to Jolene on 3/3/14Jolene meets with the manager on 4/1/2014 and provides a 401K Statement dated 1/1/2014. Can the manager use the statement dated 1/1/2014? Yes, the statement was not older than 120 at the time of receipt ANDIt was received by the manager within 120 days of recert effective date.

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VerificationIndependent 3rd party verification is needed when:There is incomplete EIV income information for a tenant. Examples include:

• The effective date of employment, unemployment or SS benefits.

• New employment pay rate, number of hours per week, pay frequency, hire date (which are not required to be reported and may not be in EIV).

• When there is no EIV income data for a tenant.

A current HUD 9887 & 9887-A must be signed, dated and on file for each adult household prior to accessing EIV data for a

household member.

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Income Reports

Workshop: Report Frequency

XXXX

XX

X

XX

Zeffert & AssociatesZeffert & Associates


Zeffert & Associates2321 Weldon Parkway St. Louis, MO 63017 P: 866-760-6000

Existing Tenant Search Report(Prior to Move-In)

Purpose: Identify applicants who are receiving subsidy at other properties

What to do: Give applicant an opportunity to explain.

Report is filed in the tenant file

Example: A child subject to Joint custody




Failed EIV Pre-Screening Report Purpose: Identify tenants who have

missing or invalid personal identifiers

What to do: Check for typos, including incorrect SS#. Follow up with tenant.

Run Monthly Place in Master FileCheck-

DOBLast Name




Failed Verification Report Purpose: Identify tenants who have

missing or invalid personal identifiers with SSA

What to do: Check for typos. Follow up with tenant. Encourage them to contact SS with errors on SS’s reporting.

Run Monthly Place in Master File

Tenant to correct SS reporting




Multiple Subsidy Report Purpose: Identify existing tenants

who may be receiving subsidy elsewhere.

What to do: Give applicant an opportunity to explain.

Contact PHA or O/A Run at least quarterly for both MIH

and PIH and Place in MasterHousing Choice Vouchers may show up and

not be a problem if subsidy not double




Deceased Tenant Report Purpose: Identify tenants reported

by SS as deceased. What to do: Check with HH. Report

inaccurate data SS. Place in Master File, Run at least quarterly

If deceased: update ‘59 HH composition and income.

If single member HH: 14 days from EARLIER of decease or vacancy




New Hires Report Purpose: Identify existing tenants

who have started jobs in the past 6 months.

What to do: If job not reported send letter to come to office within 10 days.

Run the report at least quarterly for MIH and PIH.

Keep in Master FileTenant specific information to be kept in tenant file




Additional Reports Monthly Summary Reports No Income Reported on 50059 No income Reported by HHS/SSA Place in Tenant File as needed Any tenant specific information is to

be kept in tenant file

Run Reports as specified in your Policies and Procedures Manual




Summary Report Purpose: Provides summary of

current certification. Also provides Identity Verification Status. Place in tenant file.

What to do: 4 Verification statuses:

Once tenant is verified, they do not need to be verified again

1. Verified– personal ID match SS2. Failed – personal ID do not match SS3. Not verified – not sent to SS yet, or in process

• No action necessary, but check monthly for changes

4. Deceased – SS says deceased




Income Discrepancy Report Purpose: Reports discrepancies

between ‘59 and EIV. When difference is $2,400 under or over-reported.

What to do: Check for data entry accuracy.

ID discrepancy Understand discrepancy

Negative numbers = potential under-reportingPositive numbers = potential unreported decreases in income

Possible reasons:• Invalid discrepancy (employment changed prior to MI)• Tenant error (failure to disclose income)• O/A Error (data entry)• O/A Previously aware of error. Still in EIV system

Not all can be resolved: errors in SS or HUD system











TRACS Income Code Type of Income

B Business

F Federal Wage

M Military Pay

W Nonfederal Wage

U Unemployment

SS Social Security

SSI Supplemental SecurityIncome











Understanding POI (Period of Income)Effective Date of Action = effective date of active 50059Period of Income Start Date = 15 months prior to effective date of 50059Period of Income End Date = 12 months form the POI start date

Cert effective 7-1-2014POI Start Date 4-1-2013PIO End Date 3-31-2014





between ‘59 and EIV. When difference is $2,400 under or over-reported


Understand discrepancy




Income Discrepancy Report Keep in Tenant File. Attach the resolution to the

discrepancy as applicable Must be printed at be same time as

the Income Report. Print for all Recerts, Annual and

InterimDiscrepancy may re-appear

for several months after resolution




Steps to Address EIV Income Discrepancies

Identify Discrepancy Type:

Valid or Invalid

VALID

Tenant Failed to Report Income

Investigate 1. Obtain 3rd party verification.

2. Notify tenant to contact O/A within 10 days to discuss

3. Determine if “tenant error” or “fraud”




1. Obtain 3rd party verification.



1. Correct affected 50059s (not more than 5 years)

2. Notify Tenant of obligation to reimburse O/A 3. Collect Funds/Enter into Payment

Agreement (See chapter 8)4. Reimburse HUD collected funds5. Maintain copies of the Income Discrepancy

Report, Verification, affected 50059’s and repayment agreement in the tenant file during tenancy and three years after.

Tenant

Error




1. Obtain 3rd party verification.



Tenant

Fraud

1. Take Actions to address fraud and terminate tenancy in accord with Chapter 8 in the 4350.3 Change 4.

2. Report Fraud to HUD – OIG3. Maintain copies of the Income Discrepancy

Report, verifications, affected 50059’s and termination documentation in the file for 3 years after tenancy.






Valid or Invalid

VALID

O/A ErrorCorrect

1. Document in the file that the reported income discrepancy was a result of management error.

2. Correct all affected 50059’s

3. Reimburse HUD over paid subsidy

4. Maintain copies of the Income Discrepancy Report, Verification, and affected 50059’s in the file for 3 years after tenancy.






Valid or Invalid

INVALID

Erroneous Data reported by SSA/NDNH Investigate




Erroneous Data reported by SSA/NDNH Investigate


2. Determine source of incorrect data

3. Gather and maintain documentation demonstrating that the discrepancy is invalid ((i.e. correspondence with employer/SSA)

4. Document the file that the discrepancy is invalid and what steps were taken to resolve.

5. Maintain copies of the Income Discrepancy Report in the tenant file along with supporting documentation.






Valid or Invalid

INVALID

POI Prior to Move-in Investigate




POI Prior to Move-in Investigate

1. Obtain verification demonstrating the income reported was prior to move-in. I.e. For wages; verify that the tenant is no longer employed.

2. Document the tenant file that the income discrepancy is invalid; Income reported was for a period prior to move-in and it has be verified that the tenant is no longer receiving income from the reported source.

3. Maintain copies of the Income Discrepancy Report in the tenant file along with supporting documentation.




Income Report Purpose: Verify SS and if there is

employment income.

Not ALL countable income is on this report!

Annualize current for next 12 months

Not On Report• Welfare• Most Pensions• Some employment




Income Report Purpose: Verify SS and employment

income.

What to do: SS Verify, but AND calculate If tenant agrees to accuracy, have

them sign the EIV printout. If they disagree they need to provide documentation

Address COLA per your company policy

Medicare:


N = state is not paying





income.



Address COLA per company policy Medicare:


Y = if state paying& start date





income.



Address COLA per company policy Medicare:


Y = if state stopped paying

with start & end dates





income.

What to do: SS If tenant disputes, or claims SS not

on EIV report DO NOT send them to SS office Website Toll-free number





SS doesn’t provide info for garnishments or other deductions (ex.

Medicare Part D prescription Drug premiums). May reveal allowable deductions,

differences between gross & net SS in excess of Medicare premium should be discussed with the tenant

NOTE: the disability information provided by EIV is inaccurate and should NOT be used to verify disability status for a HUD program or elderly household deduction.




Additional Income Reports Accessed from the “Monthly

Summary Report”Caution: Reports retained in a tenant file must only contain information for members of that tenant’s household. If you are printing your EIV reports so they do not have page breaks between households. Owners will need to separate the reports by household by cutting the reports apart until page breaks are inserted

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Record Retention

Tenant File:3 years after tenancy

Applicant File (did not move-in): 3 years Master File:

3 years after run

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Requesting Info from SSADo not send tenants to SSA office

www.socialsecurity.gov or 1-800-772-1213

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Identity TheftIf tenant suspects identity theft:• Check with SSA• File complaint with Federal Trade Commission (FTC)• Monitor Credit Report

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Overpaid AssistanceRepayment goes back 5 years covered by 9887• No longer all the way back to move-inOwner mistakes cannot be collected from tenant

Repayment Agreement

Owner may retain a portion to recoup costsLesser of:

Actual costs (some examples):• Staff time investigating, meeting with tenants• Drafting agreement• Generating invoices• Generating manual voucher adjustment

20% of amount collected

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Repayment Options1. Lump sum2. Installments3. Combo of both4. Cannot collect more than 40% of income unless

tenant agrees

Tenant and owner must agree• Tenant may consult with HUD Housing Counseling

AgencyRepayment Agreement

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Repayment OptionsTTP + payment plan = no more than 40% adjusted income

Repayment Agreement

Example, Page 8-33 Family monthly adjusted income is $1,230 Monthly TTP is $369 (30% of mo. Adj. income). 40% of the family’s mo. adj. income is $492The monthly payments should not exceed $123.

$ 492 (40% Adj Inc)- $ 369 $ 123

$ 369 (mo TTP)+ $ 123 $ 492

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Repayment OptionsRepayment Time Period: time to repay

Repayment Agreement

Example, Page 8-33 The tenant agrees to repay $1,000 and agrees to

monthly payments of $25. $1,000/$25 = 40 months (time period).

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Repayment Options

Repayment Agreement

Required in the plan:

1. The total amount owed, amount of any lump sum paid and the monthly payment amount.2. Reference to the lease provisions whereby the tenant is in noncompliance and may be subject to termination of their lease.3. A clause whereby the agreement can be renegotiated if there is a decrease or increase in family income of $200 or more per month.

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Repayment Options

Repayment Agreement

Required in the plan:

4. A statement that the monthly retroactive rent repayment amount is in addition to the family’s monthly rent payment, and is payable to the owner.5. A clause that late and missed payments constitute default and may result in termination of assistance and/or tenancy.6. It must be signed and dated by the tenant and the owner.

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Repayment Agreement

Overpayment of RentTenant must be notified

Notice of the change in rent, retroactive to error The new monthly rent Amount of overpayment of rent due to tenant A form for the tenant to execute and return to the

owner stating whether the tenant wishes to:(1) Receive a full, immediate refund or(2) Apply the overpayment to future monthly rent

UPDATE CHG 4

Decreases in income of $2,400 or more a year on the EIV Income Discrepancy Report run at a recertification may indicate a tenant has overpaid rent




$ 100

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Fraud“Deceit or trickery deliberately practiced in order to gain some advantage dishonestly…an intentional deception; it cannot be committed accidentally.”Must be documentedOwner MUST file a civil action to recover subsidy overpayment • owner may keep 20% of charges collected as an

“Administrative Fee”Criminal charges MAY also be brought. Tenancy must be terminated.Repayment

Agreement

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Fraud“Deceit or trickery deliberately practiced in order to gain some advantage dishonestly…an intentional deception; it cannot be committed accidentally.”Must be documentedMUST be substantiated through documentation. • If can’t be done, MUST treat as an unintentional

program violation.In cases of potential fraud:• tenant must be informed in writing of the “error”• Must be allowed to schedule a meeting within 10 days.

Repayment Agreement





30 days

Income Report

Discrepancy Report

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Common AbbreviationsCAAF Coordinator Access Authorization FormDOB Date of BirthEIV Enterprise Income VerificationHUD Department of Housing and Urban DevelopmentLIHTC Low Income Housing Tax Credit ProgramO/A Owner AgentP/P Policies and ProceduresRHS Rural Housing ServicesROB Rules of BehaviorUAAF User Access Authorization Form

verification verification reports income reports intro repayment agreement change 4 | hud handbook...

Documents

hud handbook

income information

use of eiv

eiv system

confidentiality intro

fraud intro slide

rd party verification

severe hud