| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #7684 | Closed | public | Multifamily | Les Sparks |
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I have question that has come up with a non-profit client of ours that I’m having trouble answering. Any insight you may have would be greatly appreciated. Several years ago they received a loan from the city where they are located, to be used in a rehabilitation project. The lender used HOME Funds (cfda 14.239) to fund the loan. I understand that in the year the loan funds were spent on the project, the amount spent would be included in the SEFA and also reported via the Federal Audit Clearinghouse submission, but would there be an expectation that the loan balance would be included in the SEFA and reported to the clearinghouse in subsequent years? Ultimately, there is no loan with HUD at the city or the NFP, and it’s not a HUD-insured loan. There are requirements stipulated by the city to essentially maintain low-income housing status. |
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From Les Sparks: The issue with mortgages/loans is just what remaining compliance requirements are left to manage. In most cases, the city makes these HOME funds available and then they just go away. Aside from the ongoing requirement to maintain “low-income” housing, what other compliance requirements are there? If there are none, I am going to assume that there is no reason to maintain those expenditures on the SEFA. As a matter of observation, we do not see those reported annually after the initial year. Of course, much of that money is given to for-profit entities anyway, which are not reported. It all depends on the content of the agreement. |