Title: Loan/loan guarantee outstanding balances
Accounting Policies: 1.GENERAL INFORMATIONThe accompanying schedule of expenditures of federal awards presents the activities in all federal, state and local financial assistance programs of Dignity Housing. All financial assistance received directly from federal, state or local agencies, as well as financial assistance passed through other governmental agencies or not-for-profit organizations, are included on the schedule.2.BASIS OF ACCOUNTINGThe accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts may differ from certain financial reports submitted to federal, state and local funding agencies due to those reports being submitted on either a cash or modified accrual basis.3.RELATIONSHIP TO BASIC FINANCIAL STATEMENTSExpenditures reported under Section 8 Housing Assistance Payments, CFDA #14.195, are included in rental income on the statement of activities. The remaining federal, state and local awards are reported on the statement of activities as grants. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported on the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal, state or local awards.4.LOANS AND INTEREST SUBSIDIESThe accompanying schedule of expenditures of federal awards includes various notes payable to and interest subsidies received from the Redevelopment Authority of the City of Philadelphia (RDA). The amounts reflected as expenditures in the accompanying schedule represent the outstanding balance of the notes payable as of June 30, 2022 and the related interest subsidies for the year ended June 30, 2022 for those notes that do not bear interest. The notes payable, the original proceeds of which were used for purchase and rehabilitation of various housing properties, consisted of the following at June 30, 2022:Loan Interest Balances Subsidies TotalRDADignity II HOME loan (a)$778,000$36,955$814,955ESP HOME loan (b)314,52014,940329,460Dignity III HOME loan (c)681,21332,358713,571Dignity III SHP loan (d)232,31912,138244,458$2,006,052$96,391$2,102,444(a)Note payable to RDA bearing no interest provided Dignity Housing continues to comply with occupancy and rental requirements for a period of 30 years or until the loan is paid or forgiven in full. The principal balance is due in full on March 22, 2029. Contribution revenue and interest expense of $36,955 and $36,955 have been recognized in the accompanying statement of activities for the years ended June 30, 2022 and 2021, respectively, based on an imputed interest rate of 4.75%. The note is collateralized by a 2nd mortgage on the Dignity II rental housing facilities: 5151, 5153 and 5155 Wayne Avenue, Philadelphia, PA. (b)Note payable to RDA bearing no interest and due in full on June 12, 2031, provided Dignity Housing continues to comply with occupancy and rental requirements for a period of 30 years or until the loan is paid or forgiven in full. Contribution revenue and interest expense of $14,940 and $14,940 has been recognized in the accompanying statement of activities for the years ended June 30, 2022 and 2021, respectively, based on an imputed interest rate of 4.75%. The note is collateralized by a 1st mortgage on the ESP rental housing facilities: 1646 Nedro Street, 1941 South Ithan Street, Philadelphia, PA.(c)Note payable to RDA bearing no interest and due in full on September 27, 2027, provided Dignity Housing continues to comply with occupancy and rental requirements for a period of 25 years or until the loan is paid or forgiven in full. Contribution revenue and interest expense of $32,358 and $32,358 has been recognized in the accompanying statement of activities for the years ended June 30, 2
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
CONTINUUM OF CARE PROGRAM (14.267) - Balances outstanding at the end of the audit period were 778000. CONTINUUM OF CARE PROGRAM (14.267) - Balances outstanding at the end of the audit period were 232319. HOME INVESTMENT PARTNERSHIPS PROGRAM (14.239) - Balances outstanding at the end of the audit period were 314520. HOME INVESTMENT PARTNERSHIPS PROGRAM (14.239) - Balances outstanding at the end of the audit period were 681213.