Finding Text
HUD insured mortgage program Section 223(f), ALN 14.155 Criteria: The Project’s occupancy rate should be adequate to maintain Project operations. Statement of Condition: The Project’s vacancy expense was 35% of rental revenue for the year ended September 30, 2025. Cause: Thirteen of the Project’s 48 units were vacant the entire year, and nine units were vacant for different periods during the year. Effect: Decreased revenue may result in excessive future usage of replacement reserve and debt service savings reserve funds. Decreased revenue may also negatively impact the Project’s ability to fund future Project operations. Recommendation: The Project should continue its efforts to obtain tenants and decrease vacancies. Views of Responsible Officials: We agree with the finding. The Project will continue its attempts to decrease vacancies.