Finding 398562 (2023-002)

S3800-010: Finding Reference Number 2023-002 (Significant Deficiency) S3800-011: Program Information Federal Program: Supportive Housing for Persons with Disabilities – Section 811 Federal Agency: Department of Housing and Urban Development Assistance Listing #: 14.181 Pass-through Entity: None Federal Award Identification Number and Year: N/A Type of Compliance Finding: N – Special Tests and Provisions S3800-015: Type of Finding Financial Statements and Federal Awards S3800-016: Finding Resolution Status Unresolved S3800-017: Information on Universe Population Size N/A S3800-018: Sample Size Information N/A S3800-019: Identification of Repeat Finding and Finding Reference Number 2022-002 S3800-020: Criteria Per HUD Handbook 4381.5, REV-2, CHG-2, Management Agents of insured and assisted multifamily housing projects are required by HUD administrative guidelines to have a HUD approved Project Owner's / Management Agent’s Certification for Multifamily Housing Projects for very low-income persons with disabilities (Form 9839-B). S3800-030: Statement of Condition During our audit of the Organization’s fiscal year ended December 31, 2023 federal award program, we noted that the Organization did not have a HUD approved Form 9839-B; the last effective date was August 31, 2014. S3800-032: Cause Form 9839-B expired in 2014 and the Organization failed to obtain an approved HUD Form 9839-B since then. However, as of March 22, 2023, the Organization submitted a request for approval of Form 9839-B to HUD, however HUD requested additional documentation from the Organization regarding the operation and management of the property before granting approval. S3800-033: Effect or Potential Effect Charges for management fees for the fiscal year were not authorized. S3800-035: Auditor Non-Compliance Code: J – Unauthorized management fee S3800-040: Questioned Costs $9,478 S3800-045: Reporting Views of Responsible Officials The Organization agreed with this finding. S3800-050: Context The Organization is required to have all of its necessary forms and licenses current and up to date. S3800-080: Recommendation The Organization should establish a process to ensure they have obtained all required HUD approved forms. Additionally, the Organization should ask HUD to retrospectively approve Form 9839-B effective September 1, 2014. As of March 22, 2023, the Organization submitted a request for approval of Form 9839-B to HUD, however HUD requested additional documentation from the Organization regarding the operation and management of the property before granting approval, in which we recommend the Organization submit. S3800-090: Auditor’s Summary of the Auditee’s Comments on the Findings and Recommendations Auditee agreed with our recommendation. S3800-130: Response Indicator Agree S3800-140: Completion Date or Proposed Completion Date July 31, 2024 S3800-150: Response See Corrective Action Plan