FAC Explorer

Audit 44593

FY End
2022-03-31
Total Expended
$4.06M
Findings
4
Programs
2
Organization: Jacksonville Towers, INC (FL)
Year: 2022 Accepted: 2022-12-12
Auditor: Bellows Associates P A

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
41958 2022-001 - - B
41959 2022-002 - - N
618400 2022-001 - - B
618401 2022-002 - - N

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $3.31M Yes 2
14.195 Section 8 Housing Assistance Payments Program $750,525 Yes 0

Contacts

Name Title Type
LNLJYFW4ZGU7 Irene Phillips Auditee
9548359200 Jennifer R. Koffman Auditor
No contacts on file

Notes to SEFA

Title: NOTE C U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT MORTGAGE REFINANC Accounting Policies: NOTE A BASIS OF PRESENTATIONThe accompanying schedule of expenditures of federal awards includes the federal award activity of Jacksonville Towers, Inc., HUD Project No. 082-11090, and is presented 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 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 Jacksonville Towers, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Jacksonville Towers, Inc. NOTE B SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESExpenditures reported on the Schedule are reported on the accrual basis of accounting. Suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, whereincertain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Jacksonville Towers, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the UniformGuidance. Jacksonville Towers, Inc. has received a U.S. Department of Housing and Urban Development mortgage insurance for the refinancing of existing multifamily rental housing projects loan under section 207/223(f) of the National Housing Act. The loan balance outstanding at the beginning of the year is included in the federal expenditures presented in the schedule. Jacksonville Towers, Inc. received no additional loans during the year. The balance of the loan outstanding at March 31, 2022 was $3,229,030.

Finding Details

Finding 2022-001
FINDING No. 2022-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: All management fee expenses. Sample Size Information: All management fee expenses. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD, the Project shall only use funds as specified in the Regulatory Agreement and owes the management company fees at the rate specified in the Project Owner?s/Management Agent?s Certification (Form HUD-9839-B). Statement of Condition: As a result of an expired Form HUD-9839-B, the Project has been overcharged management fees, resulting in an unauthorized loan to the Management Company. Cause: The Project?s Form HUD-9839-B expired and a new one was not prepared nor approved by HUD. Effect or Potential Effect: The Project has made an unauthorized loan to the management company as a result of overpaying management fees of $4,500. Auditor Non-Compliance Code: J ? Unauthorized Management Fees. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendations will be adopted. FINDING No. 2022-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 (Continued) Recommendation: The Project should implement procedures to monitor the expiration of HUD required documents to ensure timely preparation and approval. Response Indicator: Agree Completion Date: 3/31/2023 Response: Management is in the process of hiring a compliance coordinator to ensure all future HUD required documents are submitted timely.
Finding 2022-002
FINDING No. 2022-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamiy Rental Housing Projects, CFDA 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: Escrow accounts. Sample Size Information: Escrow accounts. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by the regulatory agreement, the Project is required to pay, when due, all taxes, assessments and other charges. Statement of Condition: The Project is deficient in funding escrow deposits in the amount of $10,423, as required by HUD. Cause: The Project did not properly fund the escrow accounts based on current period insurance premiums and tax rates. Effect or Potential Effect: The escrow deposits are not sufficient to meet future obligations. Auditor Non-Compliance Code: Z - Other Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendations will be adopted. FINDING No. 2022-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 (Continued) Recommendation: The Project should make sufficient deposits to the escrow accounts in a timely manner. Response Indicator: Agree Completion Date:3/31/2023 Response: The Project will perform monthly escrow analysis to ensure the accounts are adequately funded at all times.
Finding 2022-001
FINDING No. 2022-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: All management fee expenses. Sample Size Information: All management fee expenses. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD, the Project shall only use funds as specified in the Regulatory Agreement and owes the management company fees at the rate specified in the Project Owner?s/Management Agent?s Certification (Form HUD-9839-B). Statement of Condition: As a result of an expired Form HUD-9839-B, the Project has been overcharged management fees, resulting in an unauthorized loan to the Management Company. Cause: The Project?s Form HUD-9839-B expired and a new one was not prepared nor approved by HUD. Effect or Potential Effect: The Project has made an unauthorized loan to the management company as a result of overpaying management fees of $4,500. Auditor Non-Compliance Code: J ? Unauthorized Management Fees. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendations will be adopted. FINDING No. 2022-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 (Continued) Recommendation: The Project should implement procedures to monitor the expiration of HUD required documents to ensure timely preparation and approval. Response Indicator: Agree Completion Date: 3/31/2023 Response: Management is in the process of hiring a compliance coordinator to ensure all future HUD required documents are submitted timely.
Finding 2022-002
FINDING No. 2022-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamiy Rental Housing Projects, CFDA 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: Escrow accounts. Sample Size Information: Escrow accounts. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by the regulatory agreement, the Project is required to pay, when due, all taxes, assessments and other charges. Statement of Condition: The Project is deficient in funding escrow deposits in the amount of $10,423, as required by HUD. Cause: The Project did not properly fund the escrow accounts based on current period insurance premiums and tax rates. Effect or Potential Effect: The escrow deposits are not sufficient to meet future obligations. Auditor Non-Compliance Code: Z - Other Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendations will be adopted. FINDING No. 2022-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Rental Housing Projects, CFDA 14.155 (Continued) Recommendation: The Project should make sufficient deposits to the escrow accounts in a timely manner. Response Indicator: Agree Completion Date:3/31/2023 Response: The Project will perform monthly escrow analysis to ensure the accounts are adequately funded at all times.