The Iowa Finance Authority will not provide any more rental assistance funding to United Neighbors Inc. after a review of the organization's tenant files.
In a letter to Executive Director Evelyn Nelson, Home Program analyst Rita Eble informed United Neighbors that its tenant-based rental assistance program was not in compliance with federal rules and regulations.
"IFA's review of the five tenant files reveals that the administration of the TBRA grant did not follow federal rules and regulations," Eble wrote. "IFA will not provide further TBRA funds to United Neighbors for their 2015 HOME grant. A letter will follow from IFA's General Counsel providing United Neighbors further information and details regarding the TBRA grant."
Communications director Ashley Jared said under no circumstances will the authority reinstate funding to United Neighbors for its current grant award.
The Davenport-based agency was awarded a U.S. Department of Housing and Urban Development grant in the amount of $502,560 for its rental assistance program on Aug. 5, 2015, but the Finance Authority suspended payments to the rental assistance program in late October.
More than 100 individuals and families had received rental assistance from United Neighbors.
Eight days after Nelson took over United Neighbors from former director Ida Johnson, Nelson sent an email to the authority with questions about compliance.
The email triggered a monitoring visit from Eble on Oct. 21 and, based on her findings, payments were suspended.
United Neighbors was required to recertify potential tenants for assistance and submitted paperwork for 21 clients.
In requesting copies and randomly selecting five tenants for intense review, Eble said that "discrepancies were apparent."
Missing and incomplete information included income qualifications, rent, occupancy, landlords, third-party verifications, inspections, lead-based paint requirements, leases and lease addendums.
In four of the five cases reviewed, the Finance Authority found that households were overpaid in rental assistance funding ranging from $655 to $6,892.
In the fifth case, the lease was unreadable in areas, it did not indicate what utilities the tenant was responsible to pay for, and there was no lead-based paint documentation despite a child living in the house.
Nelson, who said she was not given aware of the letter from IFA until Tuesday, issued a statement in regards to United Neighbors compliance troubles.
"Immediately after becoming Director of United Neighbors, I discovered some troubling discrepancies in one of our housing programs, the Tenant-Based Rental Assistance (TBRA) program," Nelson said. "Eight days after I started as Director, I contacted the Iowa Finance Authority (IFA) with concerns about how the program was managed under previous staff and leadership. This initial action by my office led to the eventual decision to suspend TBRA funding to United Neighbors and IFA's January file audit."
Nelson said the organization used emergency funding to provide rental assistance to families affected by the payment suspension, but was unable to handle all of the IFA's requirements due to budget constraints.
Despite all the issues, Nelson defended the organization's most recent actions since she took over control, including the decision to terminate four employees with links to the rental assistance problems.