Finding 26298 (2022-002)

Type of Finding: Significant Deficiency / Noncompliance Repeat Finding: Finding is a repeat finding from prior year. Prior year reference 2021-002. Criteria: The Regulatory Agreement requires the Project to acquire specific documentation in determining tenant eligibility. Condition: The Project could not provide all requested documents for selected tenants. Cause: The Project's controls over tenant eligibility were not working properly. Effect or Potential Effect: The missing tenant file documents are noncompliance that could, at the discretion of HUD, result in the capital advance being called due, which would require the Project to reimburse HUD for the advance and pay interest. Perspective Information: The Project failed to acquire and/or maintain appropriate documentation from tenants through initial application and renewal. Through prior history with Project, this is not a systemic issue that cannot be rectified. Recommendations: The Project should obtain all appropriate documentation for tenants in order to maintain compliance with their Regulatory Agreement. Views of Responsible Officials: Management concurs with the finding. Management will contact tenants and ensure that all appropriate documentation is obtained.