ROWHOUSE C D C

Finding #2024-001 – Significant Deficiency and Other Noncompliance. Applicable federal program: U. S. Department of Housing and Urban Development, Passed through City of Houston, HOME Investment Partnership Fund, Assistance Listing #14.239, Contract period: 08/2008 – 12/2028. Criteria: Other – The management of Row House CDC is responsible for establishing internal controls over tenant rental agreements and setting lease payment amounts in accordance with applicable HUD guidelines. Condition and context: We noted the rental rate for 1 out of 6 tenant agreements tested for eligible families did not agree to the actual amount paid by the tenant. The tenant agreement reflected $600 in monthly rent compared to the amount paid of $575. The lease amount paid by the tenant did comply with HUD guidelines. Cause: Row House CDC did not have review procedures in place to reconcile lease agreement rental rates to the rent rolls or lease payment system. Effect: Failure to adequately maintain the rent roll and verify amounts per the lease agreement could result in noncompliance with HUD tenant rental rates. Recommendation: Strengthen procedures to consistently maintain rent roll and ensure lease agreements are correct based on allowable tenant rental rates. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.

Finding #2024-002 – Significant Deficiency and Other Noncompliance. Criteria: Reporting – Row House CDC is required to submit the Data Collection Form (DCF) to the Federal Audit Clearinghouse (FAC) by the earlier of 30 days from report issuance or 9 months after the fiscal year-end, as required by 2 CFR §200.512(a). Condition and context: Row House CDC’s single audit reporting package for fiscal year 2023 including the completed DCF, was submitted to the FAC approximately 1 year after the deadline. The single audit reporting package for fiscal year 2024 including the completed DCF is expected to be submitted approximately 6 months late. Cause: The late submission occurred due to a delay in completing the independent audits. Effect: The delayed filing caused Row House CDC to be out of compliance with the FAC requirements. Recommendation: Row House CDC should develop a schedule of critical dates for completion of the single audit leading up to the FAC deadline. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.