Audit 374359

FY End

2024-08-31

Total Expended

$974,169

Findings

2

Programs

1

Organization: Row House Community Development Corporation (TX)

Year: 2024 Accepted: 2025-12-12

Auditor: BLAZEK & VETTERLING

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
1164685	2024-001	Material Weakness	Yes	P
1164686	2024-002	Material Weakness	Yes	L

ALN	Program	Spent	Major	Findings
14.239	HOME INVESTMENT PARTNERSHIPS PROGRAM	$974,169	Yes	2

Contacts

Name	Title	Type
Q6XJKTA7MGN5	Daimian Hines	Auditee
7135267662	Kay Walther	Auditor
No contacts on file

Notes to SEFA

Basis of presentation – The schedule of expenditures of federal awards (the schedule) is prepared on the accrual basis of accounting. The information in this 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 (Uniform Guidance). Federal expenses include allowable expenses funded by federal grants. Allowable costs are subject to the cost principles of the Uniform Guidance guidelines and include both costs that are capitalized and costs that are recognized as expenses in Row House CDC’s financial statements in conformity with generally accepted accounting principles. Row House CDC does not use the 10% de minimis rate. Row House CDC does not have subrecipients. Because the schedule presents only a selected portion of the operations of Row House CDC it is not intended to and does not present the financial position, changes in net assets, or cash flows of Row House CDC.

In 2006, Row House CDC received a U. S. Department of Housing and Urban Development deferred payment loan funded by the HOME Investment Partnership Program and passed through City of Houston. The balance of the outstanding forgivable loan at August 31, 2024 of $974,169, represents the actual draws paid by the City of Houston and is reported in the schedule of expenditures of federal awards as such.

Finding Details

Finding 2024-001

Finding #2024-001 – Significant Deficiency and Other Noncompliance. Applicable federal program: U. S. Department of Housing and Urban Development, Passed through City of Houston, HOME Investment Partnership Fund, Assistance Listing #14.239, Contract period: 08/2008 – 12/2028. Criteria: Other – The management of Row House CDC is responsible for establishing internal controls over tenant rental agreements and setting lease payment amounts in accordance with applicable HUD guidelines. Condition and context: We noted the rental rate for 1 out of 6 tenant agreements tested for eligible families did not agree to the actual amount paid by the tenant. The tenant agreement reflected $600 in monthly rent compared to the amount paid of $575. The lease amount paid by the tenant did comply with HUD guidelines. Cause: Row House CDC did not have review procedures in place to reconcile lease agreement rental rates to the rent rolls or lease payment system. Effect: Failure to adequately maintain the rent roll and verify amounts per the lease agreement could result in noncompliance with HUD tenant rental rates. Recommendation: Strengthen procedures to consistently maintain rent roll and ensure lease agreements are correct based on allowable tenant rental rates. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.

Finding 2024-002

Finding #2024-002 – Significant Deficiency and Other Noncompliance. Criteria: Reporting – Row House CDC is required to submit the Data Collection Form (DCF) to the Federal Audit Clearinghouse (FAC) by the earlier of 30 days from report issuance or 9 months after the fiscal year-end, as required by 2 CFR §200.512(a). Condition and context: Row House CDC’s single audit reporting package for fiscal year 2023 including the completed DCF, was submitted to the FAC approximately 1 year after the deadline. The single audit reporting package for fiscal year 2024 including the completed DCF is expected to be submitted approximately 6 months late. Cause: The late submission occurred due to a delay in completing the independent audits. Effect: The delayed filing caused Row House CDC to be out of compliance with the FAC requirements. Recommendation: Row House CDC should develop a schedule of critical dates for completion of the single audit leading up to the FAC deadline. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.