FAC Explorer

Finding 571356 (2023-006)

Significant Deficiency Repeat Finding
Requirement
A
Questioned Costs
$1
Year
2023
Accepted
2025-07-15
Audit: 362297
Organization: Reach Community Development, Inc. (OR)
Auditor: Cohnreznick LLP

AI Summary

  • Core Issue: A vendor invoice for $40 was paid without being linked to an approved CDBG property, violating funding guidelines.
  • Impacted Requirements: Compliance with CDBG funding rules, specifically ensuring all expenses are for approved rehabilitation services.
  • Recommended Follow-up: The Program Manager must implement a process to verify each invoice against the approved CDBG property list before submission for reimbursement.

Finding Text

Finding No. 2023-006 - Uniform Guidance Compliance Requirement Code: A-Allowable Costs - Significant Deficiency CDBG Entitlement Grants Cluster Federal Assistance Listing Number #14.218 Community Development Block Grants - Entitlement Grants Cluster Entity Identifying Number Initial year Finding instances Passed-through City of Portland, Portland Housing Bureau:: Community Develoment Block Grants/Entitlement Grants 32002765 2022 1 Criteria Owners must use CDBG funded portion of programs to fund minor rehabilitation services to approved recipients /address' in accordance with the Rehabilitation and Preservation Activities (570.202(b)(2) and/or (11)). Condition The owner paid 1 vendor invoice of 79 tested, that were not listed on the CDBG Address List as reported to Portland Housing Bureau ("PHB") and charged through to and was reimbursed by PHB under their CDBG Grant. Cause REACH's Community Builders Program Manager did not ensure that the invoices were for an approved CDBG property. Effect or Potential Effect CDBG funds may be spent inappropriately potentially resulting in REACH having to repay the grants or a possible loss of future grants. Questioned Costs: $40. Context In connection with the procedures applied to compliance testing, there was 1 vendor invoice of 79 tested that was not for an approved CDBG property. Repeat Finding: Yes - Finding 2022-007 Recommendation REACH Community Builders Program Manager should follow procedures to match each vendor invoice to the approved CDBG property listing prior to coding to CDBG and passing through for reimbursement from this grant. Views of Responsible Officials This instance was $40 that was in fact allocated incorrectly and the $40 spent was paid back to PHB in October 2024.

Corrective Action Plan

Finding No. 2023-006 CDBG Entitlement Grants Cluster Federal Assistance Listing Number #14.218 Uniform Guidance Compliance Requirement Code: A-Allowable Costs Criteria Owners must use CDBG funded portion of programs to fund minor rehabilitation services to approved recipients /address' in accordance with the Rehabilitation and Preservation Activities (570.202(b)(2) and/or (11)). Condition The owner paid 1 vendor invoice of 79 tested, that were not listed on the CDBG Address List as reported to Portland Housing Bureau (“PHB”) and charged through to and was reimbursed by PHB under their CDBG Grant. Cause REACH's Community Builders Program Manager did not ensure that the invoices were for an approved CDBG property. Effect or Potential Effect CDBG funds may be spent inappropriately and REACH may be required to repay the grants and it may also result in a possible loss of future grants. Questioned Costs: $40. Context In connection with the procedures applied to compliance testing, there was 1 vendor invoice of 79 tested that was not for an approved CDBG property. Repeat Finding: Yes – Finding 2022-007 Recommendation REACH Community Builders Program Manager should follow procedures to match each vendor invoice to the approved CDBG property listing prior to coding to CDBG and passing through for reimbursement from this grant. Views of Responsible Officials This instance was $40 that was in fact allocated incorrectly and the $40 spend was paid back to PHB in October 2024.

Categories

Questioned Costs Allowable Costs / Cost Principles Cash Management Significant Deficiency

Other Findings in this Audit

  • 571351 2023-001
    Significant Deficiency Repeat
  • 571352 2023-002
    Significant Deficiency Repeat
  • 571353 2023-003
    Significant Deficiency Repeat
  • 571354 2023-004
    Significant Deficiency
  • 571355 2023-005
    Significant Deficiency
  • 571357 2023-007
    Significant Deficiency
  • 1147793 2023-001
    Significant Deficiency Repeat
  • 1147794 2023-002
    Significant Deficiency Repeat
  • 1147795 2023-003
    Significant Deficiency Repeat
  • 1147796 2023-004
    Significant Deficiency
  • 1147797 2023-005
    Significant Deficiency
  • 1147798 2023-006
    Significant Deficiency Repeat
  • 1147799 2023-007
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.218 Community Development Block Grants/entitlement Grants $1.76M
14.275 Housing Trust Fund $1.63M
99.999 Low Income Housing Preservation and Resident Homeownership Act of 1990-Capital Grant $964,955
14.195 Section 8 Housing Assistance Payments Program $536,176
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $527,343
21.000 Section 607(e ) of the Neighborhood Reinvestment Corporation Act, As Amended $432,750
14.241 Housing Opportunities for Persons with Aids $380,000
14.239 Home Investment Partnerships Program $214,929