Finding Text
Finding No. 2024-001 – Period of Performance
Name of Federal Agency: U.S. Department of the Treasury, Community Development Financial Institutions Fund
Federal Program Name and Assistance Listing Number: Capital Magnet Fund, No. 21.011
Federal Award Identification Number and Year: 181CM050459, 2018
Criteria
In accordance with the fiscal year 2018 Capital Magnet Fund (“CMF”) Assistance Agreement, Section 3.2 (j), the entity shall achieve project completion with respect to projects financed/supported by its entire CMF Award by no later than March 27, 2024.
Condition
The entity did not achieve project completion for all projects financed by the entity’s CMF Award by the due date.
Cause
Construction was delayed due to COVID 19 and local permitting challenges.
Effect or Potential Effect
The entity is not in compliance with the fiscal year 2018 Capital Magnet Fund Assistance Agreement.
Questioned Costs: Not applicable.
Context
One of four projects did not achieve project completion. The production targets of the fiscal year 2018 Capital Magnet Fund Assistance Agreement were met without the incomplete project.
Repeat Finding: No
Recommendation
Management should complete construction on the project and submit required documentation to the Community Development Financial Institutions Fund.
Views of Responsible Officials
One of the four CMF funded projects, Barry Farm, is a two-phase project. The construction start was delayed due to local permitting challenges and COVID-related issues which resulted in the project not being completed by the original Project Completion date of March 27, 2024. Management informed CDFI Fund of the delays in the project and on May 16, 2024, CDFI Fund provided a one-year cure period to March 31, 2025.
At that time, Management informed CDFI Fund that the second phase of the Barry Farm project would require a longer cure period due to a 30-month delivery schedule, driven by the incorporation of a large geothermal system, with delivery set for late 2026. CDFI Fund directed Management to report on the second phase’s progress with a new cure period request annually until project completion.
During the cure period, Barry Farm’s first phase was completed, and is now leased up and operating. In March 2025, Management informed CDFI of the project status for phase two which is now 24% complete and remains on schedule for completion in November 2026. CDFI Fund provided a one-year cure period until March 31, 2026. Management has otherwise significantly exceeded the grant’s performance targets and will request cure period extensions until project completion.