Finding 1205807 (2025-001)

and AL Number of Federal Program: Supportive Housing for Persons with Disabilities, AL 14.181 - Type of finding: Compliance - Resolution Status: In process -Population size: N/A - Sample size: N/A - Repeat finding: No - Criteria: Per the HUD management fee schedule for owners and agents, the basic rate for management fees is $50 per unit per month (pupm). The Project qualifies for add-on fees of $10 pupm for having 1 to 15 units in property and $3 pupm for being a Sec 811 property with the total cap of management fees at $63 pupm. - Condition: Management fees for the year ended December 31, 2025 were paid in excess of the monthly pupm cap. - Cause: Management oversight. - Effect: Management miscalculated the management fees for the year ended December 31, 2025, and hence, fees were paid in excess of the cap by $4,452. A receivable was recorded for the overpaid management fees. - Noncompliance code: J. Unauthorized management fees - Questioned costs: $4,452. - Reporting views of officials: Auditee agrees with the finding, - Context: This was noted while performing audit procedures on management fees during the audit. - Recommendation: Management should ensure that management fees are paid in accordance with HUD limits. - Auditee's comments: Auditee agrees with the finding and will repay the overcharged fees. -Auditors' summary of auditee's comments: They are in agreement. - Completion date: 12/31/26. - Response: Management plans to repay the overcharged fees as soon as possible.