Audit Finds Housing Safety Enforcement Failures at Chelan-Wenatchee Housing Authority

The Housing Authority of Chelan County and the City of Wenatchee lacked records showing it followed up on life-threatening deficiencies in federally subsidized rental housing within required deadlines, according to a state audit published September 24, 2026.

Auditors reviewed a statistical sample of 12 failed inspections from 2025. In six, the authority lacked documentation showing it had followed up and required landlords to correct life-threatening deficiencies within 24 hours of notification.

The Washington State Auditor’s Office classified the enforcement failure as a material weakness in internal controls that led to material noncompliance with the program’s inspection enforcement requirements.

“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,” auditors wrote, referring to federal Housing Quality Standards.

The finding does not identify the specific hazards or properties involved, or establish when repairs were completed.

The report covers the 2025 calendar year. The authority spent about $5.7 million under its Housing Voucher Cluster program that year, which includes Section 8 Housing Choice Vouchers. The program helps low-income families afford 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.

Its deputy director will audit all inspections each quarter rather than review a sample, according to the corrective action plan. Staff have also been directed to meet with the deputy director after a failed inspection to review the conditions and the steps required to address them.

The authority listed December 2026 as its anticipated completion date for corrective action.

The State Auditor’s Office said it will follow up during the next audit.