FAC Explorer

Audit 363729

FY End
2024-12-31
Total Expended
$7.88M
Findings
6
Programs
6
Organization: Housing and Redevelopment Authority of Clay County (MN)
Year: 2024 Accepted: 2025-08-05
Auditor: Brady Martz & Associates PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
572603 2024-001 Significant Deficiency - N
572604 2024-001 Significant Deficiency - N
572605 2024-001 Significant Deficiency - N
1149045 2024-001 Significant Deficiency - N
1149046 2024-001 Significant Deficiency - N
1149047 2024-001 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
14.879 Mainstream Vouchers $1.49M Yes 1
14.267 Continuum of Care Program $445,370 - 0
14.195 Project-Based Rental Assistance (pbra) $329,893 - 0
14.871 Section 8 Housing Choice Vouchers $178,889 Yes 1
14.896 Family Self-Sufficiency Program $113,229 - 0
10.415 Rural Rental Housing Loans $35,976 - 0

Contacts

Name Title Type
GCSJYGM5JR75 Dara Lee Auditee
2182338883 Brian Opsahl Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (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 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. De Minimis Rate Used: N Rate Explanation: The Authority has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Schedule includes the federal award activity of the Authority under programs of the federal government for the year ended December 31, 2024. 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. Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Authority.
Title: DISCLOSURE OF OTHER FORMS OF ASSISTANCE Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (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 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. De Minimis Rate Used: N Rate Explanation: The Authority has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Authority has guaranteed debt in the Rural Rental Housing Loans (AL 10.415) in the amount of $28,276 as of December 31, 2024.

Finding Details

Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.
Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.
Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.
Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.
Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.
Finding 2024-001
Special Tests and Provisions: Rent Reasonableness Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 – Significant Deficiency Grant Award No. MN164-Housing Choice Voucher & MN164-Mainstream Voucher Federal Award Year 2024 Criteria The PHA must determine the rent to the owner is reasonable at the time of initial leasing and must determine reasonable rent during the term of the contract before any increase in the rent to owner. The PHA must maintain records to document the basis for determination that rent to owner is a reasonable rent (initial and during the term of the HAP contract) (24 CFR sections 982.4, 952.54(d)(15), 982.158(f)(7), and 982.507. Condition During our testing on 40 of the Authority’s 747 tenant files, it was noted that rent reasonableness was not performed on one occasion when a rent increase occurred. Questioned Costs None Context N/A Effect HAP payments could have been paid to a tenant where rent was not considered reasonable. Cause Upon change in rent during the term of the HAP contract, the Authority did not perform rent reasonableness comparisons prior to the increase. Rent reasonableness was completed once the file was selected by the auditors. Repeat Finding Not a repeat finding. Recommendation We recommend that the Authority review their control procedures to ensure all compliance procedures are being performed timely. Views of Responsible Officials The Authority recognizes the deficiency and plans to implement the auditor’s recommendation.