Finding 1153829 (2024-003)

Material Weakness Repeat Finding
Requirement
A
Questioned Costs
-
Year
2024
Accepted
2025-09-22

AI Summary

  • Core Issue: The Corporation is still liable for a $49,775 PPP loan that was charged off by the lender and not forgiven due to ineligibility.
  • Impacted Requirements: The loan was not approved by HUD, preventing payments from current Project funds, and the Corporation does not meet the criteria for forgiveness as a nonprofit.
  • Recommended Follow-Up: Review the Corporation's eligibility for future funding options and explore alternative repayment strategies for the outstanding loan.

Finding Text

The Corporation entered into Paycheck Protection Program Loans (PPP) for $49,775 via QuickBooks Capital through Cross River Bank (the Lender). The Lender has charged off the PPP loan, and the SBA purchased it. The Corporation is still liable for the PPP Loan. Due to the PPP loan not being approved by HUD, the payment of principal and interest cannot be made with current Project funds. The PPP Forgiveness Application was submitted to QuickBooks Capital. On April 25, 2025, the Corporation’s PPP loan was not forgiven. Per QuickBooks Capital, “However, after a review of your business’ operations, it has been determined that your business operates in a manner that would indicate it to be an ineligible business as outlined in 13 CFR 120.110 as revised by SBA regulations and guidance.” According to 13 CFR 121.110, Nonprofit businesses are ineligible for PPP Loan forgiveness.

Corrective Action Plan

The Corporation will register the PPP loan with the SBA to determine the course of action that can be taken.

Categories

Procurement, Suspension & Debarment Eligibility HUD Housing Programs Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 1153826 2024-001
    Material Weakness Repeat
  • 1153827 2024-001
    Material Weakness Repeat
  • 1153828 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $2.81M
14.195 Project-Based Rental Assistance (pbra) $689,145