Audit 22244

S3800-010 Finding Reference Number: 2022-001 S3800-011 Title and CFDA Number of Federal Program: 14.219 - Flexible Subsidy Program Supportive Housing for the Elderly (Section 202) S3800-015 Type of Finding: Federal Award Finding S3800-016 Finding Resolution Status: In process S3800-017 Information on Universe and Population Size: 7 new tenants into the unassisted units. S3800-018 Sample Size Information: 3. Sample size: 3. Dollar amount: N/A. S3800-019 Identification of Repeat Finding and Finding Reference Number: Not a repeat finding. S3800-020 Criteria: Paragraph 4 of the Deferred Flexible Repayment Use Agreement ("the Use Agreement"), dated November 1, 2015, requires, in the case of the unassisted units, the Project to be used solely for moderate income elderly or disabled persons. S3800-030 Statement of Condition: During our review of compliance with the criteria set forth above, we noted one move-in during the year whose income exceeded the current moderate income threshold (80% of the median income for a single person). S3800-032 Cause: No income verification performed for non-assisted units. S3800-033 Effect or Potential Effect and Perspective: The potential effect is non-compliance with the provisions of the Use Agreement. Perspective - the Flexible Subsidy loan is substantially retired. Upon retirement, while the Use Agreement will be in place until October 31, 2035, the non-compliance would have no apparent material effect. S3800-035 Auditor Non-Compliance Code: Z - Other S3800-040 Questioned Costs: No questioned costs. S3800-045 Reporting Views of Responsible Officials: S3800-x12 Please identify the property(s) and associated questioned costs this finding applies to: Smith Tower. S3800-037 FHA/Contract Number: 127-SH009T S3800-050 Context: The Use Agreement does not provide any specific provisions or instructions with respect to the documentation that should be obtained in order to satisfy the requirement. Furthermore, inasmuch as the units are unassisted, there was no misuse of housing rental assistance. S3800-080 Recommendation: Management should establish minimum documentation standards for the processing of new applicants into the unassisted units. Furthermore, management should apply those standards to move-ins for 2020 - 2022. S3800-090 Auditor's Summary of Auditee's Comments on the Findings and Recommendations: Auditee agrees with finding and recommendation with immediate corrective action. S3800-130 Response Indicator: Agree S3800-140 Completion Date: 2/27/2023 S3800-150 Response: Auditee agrees with finding and has implemented corrective action.

S3800-010 Finding Reference Number: 2022-001 S3800-011 Title and CFDA Number of Federal Program: 14.219 - Flexible Subsidy Program Supportive Housing for the Elderly (Section 202) S3800-015 Type of Finding: Federal Award Finding S3800-016 Finding Resolution Status: In process S3800-017 Information on Universe and Population Size: 7 new tenants into the unassisted units. S3800-018 Sample Size Information: 3. Sample size: 3. Dollar amount: N/A. S3800-019 Identification of Repeat Finding and Finding Reference Number: Not a repeat finding. S3800-020 Criteria: Paragraph 4 of the Deferred Flexible Repayment Use Agreement ("the Use Agreement"), dated November 1, 2015, requires, in the case of the unassisted units, the Project to be used solely for moderate income elderly or disabled persons. S3800-030 Statement of Condition: During our review of compliance with the criteria set forth above, we noted one move-in during the year whose income exceeded the current moderate income threshold (80% of the median income for a single person). S3800-032 Cause: No income verification performed for non-assisted units. S3800-033 Effect or Potential Effect and Perspective: The potential effect is non-compliance with the provisions of the Use Agreement. Perspective - the Flexible Subsidy loan is substantially retired. Upon retirement, while the Use Agreement will be in place until October 31, 2035, the non-compliance would have no apparent material effect. S3800-035 Auditor Non-Compliance Code: Z - Other S3800-040 Questioned Costs: No questioned costs. S3800-045 Reporting Views of Responsible Officials: S3800-x12 Please identify the property(s) and associated questioned costs this finding applies to: Smith Tower. S3800-037 FHA/Contract Number: 127-SH009T S3800-050 Context: The Use Agreement does not provide any specific provisions or instructions with respect to the documentation that should be obtained in order to satisfy the requirement. Furthermore, inasmuch as the units are unassisted, there was no misuse of housing rental assistance. S3800-080 Recommendation: Management should establish minimum documentation standards for the processing of new applicants into the unassisted units. Furthermore, management should apply those standards to move-ins for 2020 - 2022. S3800-090 Auditor's Summary of Auditee's Comments on the Findings and Recommendations: Auditee agrees with finding and recommendation with immediate corrective action. S3800-130 Response Indicator: Agree S3800-140 Completion Date: 2/27/2023 S3800-150 Response: Auditee agrees with finding and has implemented corrective action.