Notes to SEFA
The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the North Carolina Housing Finance Agency (the “Agency”) under programs of the federal government for the year ended June 30, 2025. 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 (the “Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the Agency, it is not intended to and does not present the financial position, changes in net position or cash flows of the Agency. Therefore, certain amounts presented in the Schedule may differ from amounts presented in the Agency’s financial statements. All of the Agency’s federal awards were in the form of cash assistance for the year ended June 30, 2025.
Expenditures reported on 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 not allowable or are limited as to reimbursement. As directed by the Office of the State Auditor of North Carolina, expenditures of funds from the State of North Carolina totaling $112,479,276 for the year ended June 30, 2025 are excluded from the Schedule. The negative adjustment shown on the Schedule represents an adjustment to amounts reported as expenditures in prior years. See Note 5 for additional details.
The Agency has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance.
The expenditures of federal awards included the following administrative fees:
During the fiscal year ended June 30, 2025, the Agency reclassified approximately $17,161,000 in federal expenditures originally reported in the June 30, 2024 schedule of expenditures of federal awards under the Community Development Block Grants – Disaster Recovery program (ALN 14.228) to the Emergency Rental Assistance Program (ALN 21.023). This reclassification resulted in the program adjustment presented on the Schedule. Prior to considering the effect of the federal funding adjustment on the Schedule, Community Development Block Grants – Disaster Recovery program expenditures for the year ended June 30, 2025 were $3,536,000. The reclassification of expenditures between the federal programs was made at the direction of the state of North Carolina (the “State”), following approval from the U.S. Department of the Treasury. The funding swap allowed the State, through the Agency, to fully utilize its Emergency Rental Assistance allocation while continuing to support affordable housing initiatives. The funding swap was not the result of any noncompliance or fault by the Agency. The expenditures reclassified to the Emergency Rental Assistance were incurred during the Emergency Rental Assistance program period of performance and meet all eligibility requirements. These expenditures are included in the accompanying Schedule under the Emergency Rental Assistance program.