Finding Text
Condition: Reserve for Replacement deposits were not made according to the HUD Regulatory Agreement. Criteria: The HUD regulatory agreement requires monthly deposits of $1,721 to be made into the reserve account. Effect: The reserve for replacements account is underfunded by $12,047. Cause: The Project is experiencing severe vacancies; therefore, cash flow is not sufficient to make the deposits. Recommendation: Consider obtaining additional federal or state funding to aid in cash flow issues as well as monitor operating expenses. Also, increase advertising for the Project. Views of Responsible Officials and Planned Corrective Action: Harbor View Housing Development Fund Co., Inc. agrees with the finding and the auditors' recommendations. The Project will implement the recommendations. As of January 4, 2023 the Project had made all of the required deposits.