Audit 17457

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying schedule of expenditures of federal, state and city awards (the Schedule) presents the activities in the federal, state and city financial assistance programs of Project HOME for the year ended June 30, 2022. All governmental financial assistance received directly from federal agencies as well as financial governmental assistance passed through other state and local agencies is included on the Schedule. All of the awards are used to fund the operations and maintenance of various shelter facilities and to provide medical and other services to individuals who are low income or homeless. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and the City of Philadelphia Subrecipient Audit Guide. Because the Schedule presents only a selected portion of the operations of Project HOME, it is not intended to and does not present the consolidated financial position, changes in net assets or cash flows of Project HOME. 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (1) The accompanying schedule of expenditures of federal, state and city awards is presented using the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. (2) Federal, state and city financial assistance expenditures are reported on the consolidated statements of activities and changes in net assets as contract revenue and included in the total agency expenditures. In certain programs, the expenditures reported in the basic consolidated financial statements may differ from the expenditures reported in the schedule of expenditures of federal, state and city awards due to program expenditures exceeding grant or contract budget limitations that are not included as federal, state and city financial assistance. (3) Project HOME did not elect to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. 3 - U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Direct Programs Project HOME was awarded a one-year grant for $773,964 from the Department of Housing and Urban Development (HUD) for a supportive housing program under HUDs Continuum of Care. This grant expired in February 2022 and the total funds expended under this grant were $773,964 as of June 30, 2022, including $502,079 expended during the year ended June 30, 2022.U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (Continued)Direct Programs (Continued)Project HOME was awarded an additional one-year grant for $3,412,610 from HUD to continue this supportive housing program. These grants includes various contracts that expire through May 2023 and the total funds expended under these grants were $2,552,866 as of June 30, 2022. Indirect Programs Project HOME entered into various contracts with the Philadelphia Office of Homeless Services to provide Continuum of Care services. The contracts provide for designated rental assistance housing units and supportive services to homeless individuals who are disabled due to severe mental illness and/or chronic substance abuse. Total funds utilized under all Continuum of Care contracts were $240,369 for the year ended June 30, 2022. This represents allowable contract rent and salaries of $267,335 plus general and administrative charges of $22,822 less resident contributions of $49,788. 4 - REDEVELOPMENT AUTHORITY OF THE CITY OF PHILADELPHIA During the year ended June 30, 2011, Project HOME entered into a note payable agreement with the Redevelopment Authority of the City of Philadelphia, for a total amount not to exceed $9,203,039. As of June 30, 2022, the total amount outstanding on this loan was $9,166,357. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS (14.218) Balances outstanding at the end of the audit period were $5,043,039. COMMUNITY DEVELOPMENT BLOCK GRANTS/STATE'S PROGRAM AND NONENTITLEMENT GRANTS IN HAWAII (14.228) Balances outstanding at the end of the audit period were $4,123,318.