Finding Text
Finding No. 2022-001 (repeats 2009-1) Federal Assistance Listing #14.134 Mortgage Insurance - Rental Housing Federal Assistance Listing #14.195 Section 8 Housing Assistance Payments Criteria The Organization is restricted by the Regulatory Agreement as to the use of Project funds, which prohibits the loan of Project funds to an affiliate. Condition As a result of the HUD OIG audit dated August 9, 2009, HUD quantified ineligible costs that are required to be repaid by Casa Otonal, Inc., an affiliate of Casa Otonal Housing Corporation. The Organization is working with both the local HUD office and Casa Otonal, Inc. to work out the repayment as Casa Otonal, Inc. has limited assets available for repayment. Cause Prior year ineligible costs resulted in a loan to an affiliate. Effect or Potential Effect Prior year ineligible costs resulted in a loan to an affiliate. Questioned Costs None Context There were no current year questioned costs or unauthorized loans. Recommendation We recommend that the Board of Directors continues to work with HUD to resolve the outstanding balance. Auditor Noncompliance Code Z ? Other ? prior year unauthorized loans from Project funds Finding Resolution Status: In process Views of Responsible Officials and Planned Corrective Actions The management agent is not involved in the resolution of this finding. The Board of Directors is working directly with HUD as the finding occurred prior to engaging the current management company.