Finding reference number: 2024-001 Assistance Listing (Federal award identification number and year): Section 8 Project-Based Cluster, Assistance Listing No. 14.195, CA16L000004, and 1996 Auditor non-compliance code: Z - Other Finding resolution status: Resolved Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size is not application to the finding. Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of condition 2024-001: The Corporation did not furnish HUD with a complete annual financial report within ninety (90) days following the year ended December 31, 2024. Additionally, Form SF-SAC Single Audit Date Collection Form for the year ended December 31, 2024 was not submitted to the federal audit clearinghouse in the required timeframe. Criteria: Pursuant to the HAP Contract, within 90 days, or such a period established in writing by HUD, following the fiscal year end, the Corporation is required to furnish to HUD a complete annual financial report based upon the examination of the books and records of the Corporation prepared in accordance with GAAP and with the requirements of HUD, and audited in accordance with Generally Accepted Auditing Standards and Government Auditing Standards. Additionally, pursuant to Uniform Guidance, the Corporation is required to submit Form SF-SAC Single Audit Data Collection Form within the earlier of 30 days after the receipt of the auditor's report or nine months after the end of the audit period. Effect: The Corporation is not in compliance with the HAP Contract and Uniform Guidance. Cause: There was a change in auditors in August 2025. Recommendation: The Corporation should ensure the annual financial report to HUD and Form SFSAC Single Audit Data Collection form are filed within the regulatory timeline. Management's response: Management concurs with the finding and recommendation. The audited financial statements have been submitted to HUD and the federal clearinghouse. No further action is required.
Finding reference number: 2024-002 Assistance Listing (Federal award identification number and year): Section 8 Project-Based Cluster, Assistance Listing No. 14.195, CA16L000004, and 1996 Auditor non-compliance code: M - Security Deposits Finding resolution status: Resolved Universe population size: 12 months Sample size information: 3 months Statistically valid sample: Yes Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $11,052 Statement of condition 2024-002: The Corporation did not maintain a cash account for residents' security deposits in an amount greater than or equal to the outstanding balance of the residents' security deposit liability at all times during the year ended December 31, 2024. At December 31, 2024, the residents' security deposit cash account was underfunded by $11,052. Criteria: Pursuant to the HAP Contract, the amount on deposit must be at least equal to the outstanding security deposit obligations. Effect: The Corporation is not in compliance with the HAP Contract. Cause: The management agent did not establish a security deposit cash account when management of the Property was transferred. Recommendation: Management should establish a security deposit cash account and ensure the residents' security deposits cash account is adequately funded. Management should transfer funds from the Property's operating cash account to adequately fund the residents' security deposits cash accounts. Management's response: Management concurs with the finding and recommendation. Management transferred operating funds to adequately fund the security deposit cash account on November 13, 2025.
Finding reference number: 2024-003 Assistance Listing (Federal award identification number and year): Section 8 Project-Based Cluster, Assistance Listing No. 14.195, CA16L000004, and 1996 Auditor non-compliance code: M - Security Deposits Finding resolution status: Resolved Universe population size: 5 move out tenant files Sample size information: 3 move out tenant files Statistically valid sample: Yes Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $529 Statement of condition 2024-003: Management did not timely disburse calculated security deposit refunds to three tenants that moved out during the year ended December 31, 2024 timely. Criteria: Pursuant to the HUD Handbook 4350.3 Chapter 6, management must refund the security deposit no later than 30 days after the tenant moves out. Effect: The Corporation is not in compliance with the HAP Contract. Cause: Management did not process security deposit refunds timely after tenants moved out. Recommendation: Management should calculate and disburse a tenant's security deposit refund within 30 days of the tenant moving out. Management's response: Management concurs with the finding and recommendation. Management disbursed the tenants' security deposit refunds on October 22, 2025 and will disburse security deposit refunds within 30 days of the tenant moving out moving forward.
Finding reference number: 2024-004 Assistance Listing (Federal award identification number and year): Section 8 Project-Based Cluster, Assistance Listing No. 14.195, CA16L000004, and 1996 Auditor non-compliance code: R - Section 8 Program Administration Finding resolution status: Resolved Universe population size: 59 tenant files Sample size information: 15 tenant files Statistically valid sample: Yes Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of condition 2024-004: During the year ended December 31, 2024, management did not maintain tenant files in accordance with HUD Handbook 4350.3 Chapter 7. Criteria: Pursuant to the HUD Handbook 4350.3 Chapter 7, management is required to complete recertifications for each tenant at least annually and appropriately adjusting HAP vouchers monthly. Effect: The Corporation is not in compliance with the HAP Contract. Cause: There was a change in management effective January 1, 2024. The former management company did not complete recertifications for all tenants by November 1, 2023 and the current management company was not made aware until March 2024. For 12 of the 15 tenant files included in our sample, HUD began to hold HAP in March 2024 as the annual certification was not completed, which was required to be completed by November 1, 2023. Recertifications dated November 1, 2022 were reprocessed and dated November 1, 2023 in order to continue receiving HAP. For 1 of the 15 tenant files, there was move out documentation in the file dated in 2023 however the unit was listed as occupied by the tenant throughout 2024. HAP was received for this tenant throughout 2024 and was corrected on the January 2025 HAP voucher. Recommendation: Management should perform a review of all tenant files and complete all recertifications that were not completed timely. Management should also ensure that all requirements of HUD Handbook 4530.3 Chapter 7 are adhered to in future periods. Management's response: Management concurs with the finding and recommendation. Management has completed the recertifications effective November 1, 2024 and 2025 or adjusted on the HAP voucher for any that were not completed timely.