On August 5, 2026, HUD’s Office of Inspector General (OIG) issued Report 2026-FO-0004, its annual review of HUD’s compliance with the Payment Integrity Information Act of 2019. The headline finding is not new. For the ninth consecutive year, HUD could not produce a compliant estimate of improper payments in its two largest rental assistance programs: Tenant-Based Rental Assistance, which funds the Housing Choice Voucher (HCV) program, and Project-Based Rental Assistance. 

What is new is where the work is heading. HUD has told the OIG it will rely on OIG testing of tenant files to produce its next estimate. PIH has said it is developing monitoring protocols to hold PHAs accountable for specific payment errors. The attention is moving from HUD headquarters to the recertification file. 

This post explains what the OIG found, what HUD is doing in response, and the specific steps PHAs can take now to make sure their files hold up when the review arrives. 

What the OIG Found 

Federal law requires every agency to estimate, each year, how much it pays out in error. For rental assistance, a compliant estimate means pulling a statistically valid sample of housing assistance payments and checking each one against the tenant file: income verification, the HAP calculation, the lease, and the contract. 

HUD has struggled to complete that testing because much of the supporting documentation it needs is maintained outside the Department. The OIG identifies a longstanding structural challenge: thousands of PHAs and contract administrators process these payments using nonstandardized processes, while the supporting documentation needed to test the underlying eligibility and payment determinations is not maintained at HUD. 

HUD divides this testing into two tiers. Payee Tier testing examines payments from HUD to contract administrators and payments from contract administrators to owners or agents based on the existence of valid contracts between the parties. Eligibility Tier testing examines the underlying tenant eligibility and housing assistance to determine whether the payment amount is correct based on tenant- and unit-level documentation. This can include tenant files, lease agreements, income verification, and documentation supporting the HAP calculation. 

In FY 2025, HUD tried a different approach. Instead of testing files, it ran data matching across every voucher and project-based payment made in FY 2024. That exercise flagged a large volume of payments as “unknown,” meaning HUD could not tell whether they were proper or improper. The categories that involve PHAs include: 

• Payments made to PHAs whose SAM.gov registration had lapsed or could not be matched to a Unique Entity Identifier. 
• Payments made on behalf of tenants whose Social Security numbers did not conform to Social Security Administration standards. 
• Payments made on behalf of tenants who appeared on the Death Master File. 
• Housing assistance payments that exceeded 110 percent of the published Fair Market Rent. 
• Payments that appeared to fall before a tenant’s move-in date or after move-out or termination. 

HUD’s data matching ultimately produced a $5.8 billion unknown-payment estimate across the two programs. The largest component was $5.2 billion associated with entities without active or identifiable SAM.gov registrations. HUD also flagged $150.3 million associated with nonconforming SSNs, $77 million associated with deceased tenants, and $287.6 million in assistance exceeding the 110 percent FMR threshold. These amounts were classified as unknown because HUD had not reviewed the underlying documentation needed to determine whether the payments were actually improper. HUD later reported that most of the flags in the deceased-tenant and SSN categories resolved as timing and recordkeeping issues rather than actual losses, though the OIG has not tested that claim.

The OIG’s objection is that HUD did not review a single supporting document to confirm whether any of those flags represented an actual error. The report also notes that HUD did not submit a required corrective plan and timeline to Congress and OMB, which was due in June 2025 after four consecutive years of noncompliance. As a result, the OIG could not evaluate HUD’s corrective actions or reduction targets because there is no compliant estimate to measure them against. 

One point worth reading carefully: the OIG states that the greatest risk to payment integrity occurs at the PHA and PBCA level, where eligibility is determined, the HAP is calculated, and payments to landlords are made.  

What HUD Is Doing in Response 

HUD’s formal response to the report is dated July 24, 2026 and is included in the report’s appendix. HUD agreed that it did not comply and stated that additional work remains. The response describes several actions, some already in effect and some still in development. 

Clearing the flagged payments. HUD reported that nearly all of the deceased-tenant flags had been cleared as timing and recordkeeping issues rather than actual losses. For the voucher program, 666 of the 8,196 flagged households were still open as of March 2026

Notice PIH 2026-11. Published April 30, 2026, this notice replaced the 2012 guidance on the EIV Deceased Tenants Report. PHAs must generate the report at least monthly. Agencies administering HCV, PBV, or Mod Rehab must run it before disbursing monthly HAP. When a household member is confirmed deceased, the PHA must submit an updated Form HUD-50058 within 60 days and, for single-member households, an End of Participation record. The notice also restates the PHA’s obligation to recover overpaid HAP from the landlord. 

SAM.gov registration. Notice PIH 2026-12 ties an active SAM.gov registration to HCV renewal funding. In its response to the OIG, PIH stated that it is reviewing the remaining PHAs with lapsed registrations and is exploring enforcement actions, including withholding of funding. As of July 2026, a portion of the PHAs originally flagged still had unresolved registrations. 

New monitoring tools. HUD reports two control enhancements: a Rental Assistance Data Accuracy and Risk (RADAR) dashboard that centralizes anomaly and risk indicators across rental assistance data, and automated SAM.gov validation that sends proactive notices to recipients with expiring registrations. 

Do Not Pay integration. HUD reinstated its computer matching agreement with Treasury in March 2025 and went live with Death Master File verification in May 2026. A revised agency-wide Do Not Pay policy is expected by February 2027. 

OIG file testing. This is separate from the report discussed above. The OIG has started a second audit, still underway, that samples housing assistance payments in the HCV program and checks each one against the tenant file at the PHA. HUD has said it will use the results of that audit as its FY 2026 improper payment estimate. In other words, HUD could not test PHA files itself, so the OIG is now doing it. For PHAs, this is the most important development in the report, because the testing happens at the agency level. 

Project Voucher. HUD described a broader modernization initiative intended to strengthen data quality and detection across both programs, with interim capabilities targeted for September 30, 2026. HUD did not provide the OIG with a project plan or timeline. 

What Has Reached Your Desk So Far 

HUD has not sent PHAs a communication about the OIG report itself. What it has sent, since late 2025, is a series of separate items that each address one piece of it: 

• A December 16, 2025 letter on citizenship and eligibility verification. 
• A January 2026 letter on the EIV-SAVE Tenant Match Report, which stated that agencies not using EIV reports may face corrective action orders, reimbursement from non-HUD sources, or withheld or reduced funding. 
• Notice PIH 2026-11 on the Deceased Tenants Report. 
• Notice PIH 2026-12 and the 2026 HAP renewal funding letters, both of which state the SAM.gov registration requirement. 
• Direct outreach to individual agencies on flagged deceased tenant and SAM.gov cases. 

Read one at a time, these look like routine housekeeping. Read together against the OIG report, they are the front end of a testing and accountability process. No single HUD communication has connected them. HUD has not said this out loud. Read together, these notices say it quietly.

Why This Matters for PHAs 

None of this creates a new program rule. What it creates is a shift in where scrutiny lands. For nine years, the finding has been about HUD’s inability to test. Now the testing is happening, the monitoring tools exist, and PIH has stated an intent to hold agencies accountable for specific error types. 

That accountability is already showing up at the field office level. In early 2026, HUD began requesting written corrective plans and timelines from agencies with repeat single-audit findings on late reexaminations and HAP accuracy. Those letters address the same file-level errors the OIG is now sampling, and they arrive with a response deadline measured in days. 

The exposure for a PHA comes down to five questions: 

• Is the agency’s SAM.gov registration active, with an owner assigned to keep it that way? 
• Is the EIV Deceased Tenants Report run and documented monthly, before HAP goes out, with every match resolved on the timelines in Notice PIH 2026-11? 
• Are identity verification failures in EIV cleared and documented, rather than carried forward? 
• Can the agency produce approval and rent reasonableness support for every payment standard above 110 percent of FMR? 
• If the OIG pulled a random sample of files tomorrow, would the income, the HAP calculation, and the Form HUD-50058 agree with each other? 

Agencies that can answer yes to all five are in a strong position. Agencies that are unsure about any of them have a clear place to start. 

What PHAs Should Do Now 

1. Confirm SAM.gov status today. Check the registration expiration date, assign a named owner, and calendar the renewal at least 60 days out. A lapse now carries a stated funding risk. 
2. Build the Deceased Tenants Report into the monthly HAP cycle. Run it before disbursement, save the report, and log the disposition of every match. Follow the 60-day Form HUD-50058 timeline in Notice PIH 2026-11 and document any landlord recovery. 
3. Clear the EIV Identity Verification Report. Resolve failed, pending, and excluded records. Where a household member is not required to provide an SSN, document the regulatory basis in the file. 
4. Audit every payment standard above 110 percent of FMR. Pull the approval, the rent reasonableness determination, and any exception authority. If the support is not in the file, obtain it now. 
5. Check HAP effective dates against move-in, move-out, and End of Participation dates. Reconcile any gaps and correct the Form HUD-50058 where needed. 
6. Run an internal quality control sample. Select files across specialists and recertification months. Test income verification, the HAP calculation, and the Form HUD-50058 against each other. Track the error rate and fix the process behind any pattern, not just the file. 

Getting Ahead of the Review 

The six steps above are the same ones an auditor works through, in roughly the same order. Agencies that complete them on their own schedule control the timing, the scope, and the findings. Agencies that wait for the sample do not. 

AMA’s Audit Preparation service is built for exactly this situation. The work starts with an assessment of the HCV files and monthly controls to identify gaps and risk, moves to equipping the team with the procedures and documentation the review will require, and closes with a strengthened, repeatable process the agency can sustain after the engagement ends. The result is a file set that holds up under an OIG sample and a team that knows why. 

When Additional Support May Make Sense 

Most agencies already know where their files are strong and where they are thin. The challenge is rarely knowledge. It is capacity. Monthly EIV reviews, exception documentation, and a real QC sample take staff time that many agencies do not have while also keeping recertifications current. 

AMA works with PHAs to establish consistent, defensible recertification and quality control processes, reduce backlogs, and give leadership clear visibility into file accuracy before an outside review arrives. If your agency wants a second set of eyes on its HCV files or a structured approach to the items above, a short conversation is a good place to start. 

This article is intended as general information and does not replace HUD regulations or official guidance.