Audit 322672

FY End
2023-12-31
Total Expended
$4.07M
Findings
2
Programs
1
Year: 2023 Accepted: 2024-09-30

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
499815 2023-001 Significant Deficiency Yes C
1076257 2023-001 Significant Deficiency Yes C

Contacts

Name Title Type
XQGLGKXJL8X8 Elizabeth Mbakaya Auditee
9736397837 Michael Pintabone Auditor
No contacts on file

Notes to SEFA

Title: 1. BASIS OF PRESENTATION Accounting Policies: The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of New Community Urban Renewal Corporation (the "Corporation" or the “Project”) under programs of the federal government for the year ended December 31, 2023. 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 presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation. De Minimis Rate Used: N Rate Explanation: The Corporation has not previously received a negotiated indirect cost rate, nor has it elected to use the 10 percent de minimus indirect cost rate allowable under Uniform Guidance. The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of New Community Urban Renewal Corporation (the "Corporation" or the “Project”) under programs of the federal government for the year ended December 31, 2023. 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 presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation.
Title: 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of New Community Urban Renewal Corporation (the "Corporation" or the “Project”) under programs of the federal government for the year ended December 31, 2023. 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 presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation. De Minimis Rate Used: N Rate Explanation: The Corporation has not previously received a negotiated indirect cost rate, nor has it elected to use the 10 percent de minimus indirect cost rate allowable under Uniform Guidance. Expenditures reported on the Schedule are reported on the accounting principles generally accepted in the United States of America 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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
Title: 3. LOANS/LOANS GUARANTEE OUTSTANDING BALANCE Accounting Policies: The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of New Community Urban Renewal Corporation (the "Corporation" or the “Project”) under programs of the federal government for the year ended December 31, 2023. 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 presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation. De Minimis Rate Used: N Rate Explanation: The Corporation has not previously received a negotiated indirect cost rate, nor has it elected to use the 10 percent de minimus indirect cost rate allowable under Uniform Guidance. The Project is financed by a mortgage loan guaranteed by the U.S. Department of Housing and Urban Development with balances and transactions relating to this program included within the Projects base financial statements. The loan outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule with the remaining balance in the amount of $3,587,383 as of December 31, 2023.
Title: 4. INDIRECT COSTS Accounting Policies: The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of New Community Urban Renewal Corporation (the "Corporation" or the “Project”) under programs of the federal government for the year ended December 31, 2023. 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 presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation. De Minimis Rate Used: N Rate Explanation: The Corporation has not previously received a negotiated indirect cost rate, nor has it elected to use the 10 percent de minimus indirect cost rate allowable under Uniform Guidance. The Corporation has not previously received a negotiated indirect cost rate, nor has it elected to use the 10 percent de minimus indirect cost rate allowable under Uniform Guidance.

Finding Details

Assistance Listing Number 14.129 HUD Sections 232 and 233 – Mortgage obligations Finding No. 2023-001 Criteria In accordance with the HUD regulatory agreement, New Community Urban Renewal Corporation may not, without prior written approval, assign, transfer, dispose of, or encumber any personal property of the project, including rent, and shall not disburse or pay out any funds except for usual operating expenses and necessary repairs. Condition New Community Urban Renewal Corporation has unauthorized loans of $1,712,142 to New Community Healthcare, Inc. as of December 31, 2023. Cause The amount due from New Community Healthcare, Inc. predominately dates back prior to 2003 and is believed to be the result of unpaid rents and potentially loans from the New Community Urban Renewal Corporation’s reserve for repairs and replacement. Effect New Community Urban Renewal Corporation is in violation of the HUD regulatory agreement. Identification as Repeat Finding Yes, refer to finding No.2022-001 Recommendation We recommend New Community Urban Renewal Corporation continues to regularly monitor its strict compliance with each aspect of the plan of compliance. Management’s Response New Community Urban Renewal Corporation and HUD have agreed to a plan of compliance requiring, among other things, restitution payments of not less than $150,000 per year through 2024. The required restitution payment for 2023 was made. New Community Urban Renewal Corporation is currently in communication with HUD regarding the new repayment proposal. Until such time as the parties agree to new terms, New Community Urban Renewal Corporation’s intention is to continue making payments of not less than $150,000. Questioned Costs None identified.
Assistance Listing Number 14.129 HUD Sections 232 and 233 – Mortgage obligations Finding No. 2023-001 Criteria In accordance with the HUD regulatory agreement, New Community Urban Renewal Corporation may not, without prior written approval, assign, transfer, dispose of, or encumber any personal property of the project, including rent, and shall not disburse or pay out any funds except for usual operating expenses and necessary repairs. Condition New Community Urban Renewal Corporation has unauthorized loans of $1,712,142 to New Community Healthcare, Inc. as of December 31, 2023. Cause The amount due from New Community Healthcare, Inc. predominately dates back prior to 2003 and is believed to be the result of unpaid rents and potentially loans from the New Community Urban Renewal Corporation’s reserve for repairs and replacement. Effect New Community Urban Renewal Corporation is in violation of the HUD regulatory agreement. Identification as Repeat Finding Yes, refer to finding No.2022-001 Recommendation We recommend New Community Urban Renewal Corporation continues to regularly monitor its strict compliance with each aspect of the plan of compliance. Management’s Response New Community Urban Renewal Corporation and HUD have agreed to a plan of compliance requiring, among other things, restitution payments of not less than $150,000 per year through 2024. The required restitution payment for 2023 was made. New Community Urban Renewal Corporation is currently in communication with HUD regarding the new repayment proposal. Until such time as the parties agree to new terms, New Community Urban Renewal Corporation’s intention is to continue making payments of not less than $150,000. Questioned Costs None identified.