Finding Text
Finding 2025-001: Supportive Housing for the Elderly (Section 202), Federal Assistance Listing Number 14.157 Criteria: HUD requires Section 811 Project Rental Assistance Contract (PRAC) properties to remit residual receipts balances in excess of $250 per unit to HUD’s Accounting Center upon termination/renewal of the PRAC contract. Condition: O’Brien Road Senior Apartments 2’s residual receipts account exceeded the $250 per unit retained balance at the PRAC anniversary/renewal date, but O’Brien Road Senior Apartments 2 did not remit the excess residual receipts to HUD’s Accounting Center nor obtain HUD approval for retention or alternative use. The overage that was not submitted amounted to $14,632. Questioned Costs: The questioned costs were calculated as the residual receipts amount less the number of units (24) multiplied by $250/unit, which computes to an overage amount of $14,632. Context: O’Brien Road Senior Apartments 2 had excess residual receipts that were not remitted at renewal. Cause: There is a lack of a formal compliance control. Effect: Noncompliance with HUD PRAC residual receipts requirements, potentially resulting in improper retention of federal funds. Recommendation: We recommend that O’Brien Road Senior Apartments 2 remit the overage of $14,632 to HUD’s Accounting Center or submit HUD 9250 for HUD approved application if directed. Views of management and planned corrective action: Management concurs and will submit form HUD 9250.