Notes to SEFA
Title: CAPITAL ADVANCE
Accounting Policies: The Schedule of Expenditures of Federal Awards (the Schedule) presents the Federal award activity of JM Apartments, Inc., HUD Project No. 016-HD-050. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule furnishes only a selected portion of the operations of JM Apartments, Inc., it is not intended to and does not present the financial position, activities, or cash flows of JM Apartments, Inc. Expenditures reflected in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are either not allowable or limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: JM Apartments, Inc. has elected to not use the 10% de minimis indirect cost rate allowed under the Uniform Guidance.
Expenditures reported in the Schedule include Section 811 Capital Advance funding and Section 811 Project Rental Assistance Contract revenue received from the U.S. Department of Housing and Urban Development. The HUD Capital Advance amount does not bear interest if the apartments are rented to qualifying low-income tenants for a period of forty years. If no violations occur during that period, the note would be forgiven upon maturity on October 1, 2048.