A state audit released on September 24, 2026, found that the Housing Authority of Chelan County and the City of Wenatchee could not produce records proving it acted on dangerous housing hazards within mandated timeframes.
Auditors examined a statistical sample of 12 failed inspections conducted in 2025. For half of those cases, the authority had no paperwork on file verifying it required landlords to rectify hazardous conditions within 24 hours of notification.
The Washington State Auditor’s Office designated this enforcement lapse as a material weakness in internal controls, which resulted in material noncompliance regarding the program’s inspection enforcement rules.
Because the Housing Authority did not follow up on HQS deficiencies within the required correction period, it cannot demonstrate that the housing units met HQS requirements, according to auditors, referring to federal Housing Quality Standards.
The report does not specify the particular dangers or properties involved, nor does it determine when repairs were finished.
The report pertains to the 2025 calendar year. During that period, the authority expended approximately $5.7 million through its Housing Voucher Cluster program, which encompasses Section 8 Housing Choice Vouchers. This program assists low-income families in affording rental housing.
Under the requirements described in the report, landlords must correct life-threatening deficiencies within 24 hours after notification of a failed inspection. Other deficiencies must be corrected within 30 calendar days of notification or within an extension approved by the authority.
If landlords fail to make corrections within the required period, the authority must stop assistance payments by the first day of the month after that period ends or terminate the housing assistance contract, the report says.
Auditors said the authority had procedures addressing those deadlines and had provided inspection training, but inspection staff did not follow procedures to ensure landlords corrected life-threatening deficiencies within 24 hours of notification.
The finding lists $0 in known questioned costs. Auditors issued unmodified opinions on the authority’s financial statements and its compliance with requirements for the major federal programs examined.
The report expressly states that the inspection finding did not modify the federal compliance opinions. No financial statement findings were reported.
The inspection enforcement problem had also appeared in the audit of the authority’s 2024 operations.
That finding involved two failed inspections without documentation demonstrating follow-up within required timeframes. The new report lists the prior finding as partially corrected.
In its update on that earlier finding, the authority said its compliance manager reviewed its 2025 inspection files following completion of the 2024 audit in September 2025. The authority said that review found its tracking system did not give management the information needed to identify failures in inspection follow-up.
The authority said its compliance manager and executive director identified continuing problems they expected would result in another finding in the 2025 audit.
The authority acknowledged that earlier internal assessments “did not accurately convey the reality of what was taking place during inspections and inspection follow-up.”
The authority said the review identified a need to improve tracking of inspection schedules, completion dates, pass-or-fail results and corrective action dates. It also reported improved enforcement through contract termination and payment abatement in late 2025 and into 2026.
In response to the new finding, the authority said it would improve inspection tracking and provide additional staff training on communication with landlords and tenants, timely follow-up and regular use of the tracking system.
Under the newly established corrective action plan, the agency’s deputy director is mandated to personally examine every inspection record on a quarterly basis, moving away from the previous practice of reviewing only partial samples. Additionally, personnel are now required to convene with the deputy director immediately following any unsuccessful inspection to evaluate the specific conditions identified and determine the necessary remedial steps.
The agency has set December 2026 as the target date for the full implementation of these corrective measures. The State Auditor’s Office indicated that it will verify the progress of these changes during its next scheduled audit cycle.