Finding 976679 (2023-002)

Type of Finding – Federal Award Finding Finding Resolution Status – In process Identification of Repeat Finding and Finding Reference Number – Finding Number 2022-002 - CFDA 14.181 - Supportive Housing for Persons with Disabilities (Section 811) Criteria or Specific Condition – The Regulatory Agreement requires the Company to make monthly deposits of $654 to the reserve for replacements. Statement of Condition – In addition to the five monthly deposits that were not made in 2022, the Project only made eleven (11) monthly deposits of $654 to the replacement reserve during 2023. As a result, the Project’s reserve for replacements was underfunded by $3,925 at December 31, 2023. Cause – The Project did not have sufficient cash flow to make the required deposits. Effect or Potential Effect – The Project is not in compliance with the regulatory requirements. Auditor Non-Compliance Code – N – Reserve for replacements deposits. Questioned Costs – $3,925 Reporting View of Responsible Officials – We concur with the auditor’s recommendation. Recommendation – The Project should deposit the reserve for replacement shortage of $3,925. Auditor’s Summary of the Auditee’s Comments on the Findings and Recommendations – Agree Response Indicator – Agree Completion Date – December 31, 2024 Response – Once the Project’s cash flow improves, the reserve for replacement deposits will be caught up and made monthly thereafter.