FAC Explorer

Audit 5747

FY End
2023-03-31
Total Expended
$1.16M
Findings
2
Programs
2
Organization: West Henrietta Housing Development Fund Corporation (NY)
Year: 2023 Accepted: 2023-12-07
Auditor: Bonadio & CO LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
3677 2023-001 Material Weakness Yes P
580119 2023-001 Material Weakness Yes P

Programs

ALN Program Spent Major Findings
14.239 Home Investment Partnerships Program $186,173 - 0
14.157 Supportive Housing for the Elderly $41,523 Yes 0

Contacts

Name Title Type
L94UJU5AF137 Florencio Del Valle Auditee
5853266530 Craig Stevens Auditor
No contacts on file

Notes to SEFA

Title: CAPITAL ADVANCES AND NOTE PAYABLE Accounting Policies: BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of West Henrietta Housing Development Fund Corporation, HUD Project No. 014-EE206 (the Corporation), under programs of the federal government for the year ended March 31, 2023 and has been prepared in accordance with accounting principles generally accepted in the United States of America. 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 the Corporation, it is not intended to and does not present the financial position, change in net assets, or cash flows of the Corporation. De Minimis Rate Used: N Rate Explanation: INDIRECT COST RATE The Corporation has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The Corporation has received Section 202 capital advances from the U.S. Department of Housing and Urban Development’s Supportive Housing for the Elderly program (Assistance Listing No. 14.157). Under the terms of the capital advance agreements, the Corporation must continue to operate the project for the specified purpose for a period of 40 years. Failure to operate the project in accordance with the capital advance agreement would result in the Corporation being required to repay HUD the entire capital advance, plus interest, since the date of the first advance. The Corporation has a note payable to the Housing Trust Fund Corporation in the amount of $186,173. The note does not bear interest and does not require any principal payments until November 2055, when the entire amount is due. The Corporation must keep the related housing available for a period of 50 years for low-income elderly individuals. Failure to keep the related housing available for these individuals would result in the Corporation being required to repay the entire loan balance at the time of default. The note is secured by the related property and building.

Finding Details

Finding 2023-001
Finding 2023-001 Program U.S. Department of Housing and Urban Development’s Supportive Housing for the Elderly (Section 202) and Project Rental Assistance, Assistance Listing No. 14.157. Condition We determined a sample selection size of one selection for tenant testing. The Corporation did not complete Form HUD-50059, Owner’s Certification of Compliance with HUD’s Tenant Eligibility and Rent Procedures, before the tenant’s anniversary date, as required by HUD, for the selection. Criteria Tenant recertifications should be completed and maintained as required by HUD requirements. Cause There were no procedures in place to ensure that all annual recertifications were properly completed and maintained. Effect Failure to comply with the annual recertification process is an instance of noncompliance with the Regulatory Agreement. Recommendation We recommend the Corporation to establish procedures to ensure that the annual recertifications are completed on a timely basis in accordance with HUD requirements. Reporting Views of Responsible Officials Management agrees with the recommendation and the Corporation’s Board of Directors has made the decision to change property managing agents effective January 1, 2024. It is anticipated that the change to a new property managing agent will allow the Corporation to establish procedures to ensure all recertifications are performed and maintained in accordance with the regulatory agreement.
Finding 2023-001
Finding 2023-001 Program U.S. Department of Housing and Urban Development’s Supportive Housing for the Elderly (Section 202) and Project Rental Assistance, Assistance Listing No. 14.157. Condition We determined a sample selection size of one selection for tenant testing. The Corporation did not complete Form HUD-50059, Owner’s Certification of Compliance with HUD’s Tenant Eligibility and Rent Procedures, before the tenant’s anniversary date, as required by HUD, for the selection. Criteria Tenant recertifications should be completed and maintained as required by HUD requirements. Cause There were no procedures in place to ensure that all annual recertifications were properly completed and maintained. Effect Failure to comply with the annual recertification process is an instance of noncompliance with the Regulatory Agreement. Recommendation We recommend the Corporation to establish procedures to ensure that the annual recertifications are completed on a timely basis in accordance with HUD requirements. Reporting Views of Responsible Officials Management agrees with the recommendation and the Corporation’s Board of Directors has made the decision to change property managing agents effective January 1, 2024. It is anticipated that the change to a new property managing agent will allow the Corporation to establish procedures to ensure all recertifications are performed and maintained in accordance with the regulatory agreement.