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Finding No. 2024-004 - Uniform Guidance Compliance Requirement Code: E-Eligibility - Significant Deficiency HUD HOME Investment Partnerships Program Federal Assistance Listing Number #14.239 HOME Investment Partnership Program Entity Identifying Number Initial Year Finding instances Passed-through Clark County: McCallister Village (Fruit Valley) 2010-HOME-0H0 2010 1 Total instances 1 Criteria Each owner must comply with the requirements set forth in 24 CFR Part 92 regulations as outlined in the "Compliance in HOME Rental Projects: A Guide for Property Owners" published by HUD which requires the property to maintain the contracted number of HOME units as well as the designated splits in bedroom size and High Home/Low Home unit ratios. Condition The owner did not make available to HOME tenants the contracted number and type of HOME units. This is considered a temporary noncompliance as follows: "Next Available Unit" rule: The owner must rent the next comparable or smaller unit that becomes vacant to a low-income household. Temporary noncompliance: The unit is temporarily out of compliance with HOME requirements, but the property can regain compliance by following the "next available unit" rule. Unit conversion: If the owner fails to comply and rents a comparable vacant unit to a non-low-income tenant, the over-income unit loses its low-income status and the building's compliance is reduced. A two bedroom unit did become available in 2024 and this tenant was not relocated. Cause Management's policies with respect to maintaining the number and split of contracted HOME units were not consistently followed. Effect or Potential Effect The procedures for determining and maintaining the correct HOME units within the property were not applied. This could result in ineligible tenants occupying HOME designated units. Questioned Costs: Not applicable. Context In connection with the procedures applied to our HOME units testing, one of the five properties tested did not meet the contracted HOME units size portfolio (a tenant is over the max HOME income limit allowed)). Repeat Finding: No Recommendation Management should follow procedures in place to ensure consistent application and adherence to the requirements in accordance with the "Compliance in HOME Rental Projects: A Guide for Property Owners" published by HUD. Views of Responsible Officials ________________OPEN FOR REACH REPLY