Finding Text
2022-001 Name: Home Investment Partnership Program CFDA #: 14.239 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Program Income Criteria The loan documents require that recipients of HOME loans continue to own and reside in their homes that were acquired using HOME funding. Condition During our test of loan monitoring procedures, we noted that all of the loans tested did not include verification documentation regarding loan recipients were the home owners during the 2021-2022 fiscal year. We also noted verification that the loan recipients occupied the homes obtained with HOME funding was missing. Cause The City did not have formalized loan monitoring policies and procedures in place to ensure that loans were monitored on an annual basis in accordance with the loan agreements. Effect Documentation was not provided to verify that the loan recipients were in compliance with the requirements of their loan agreements. Questioned Cost No questioned costs were identified as a result of our procedures. Context We randomly selected one of the two HOME loan recipients to test loan monitoring procedures. Sampling was a statistically valid sample. We noted that the recipient was not in compliance with the HOME loan agreements. Repeat Finding This is a repeat of prior year finding 2021-001. Recommendation We recommend that the City develop and maintain policies and procedures regarding loan monitoring and ensure that all documentation of loan monitoring be maintained on an annual basis. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.