The San Diego LGBT Community Center

2023-002 Program Income Program: 14.267 Continuum of Care Program Criteria: In accordance with 2 CFR 200.307, program income (in this case, tenant rent) must be correctly determined and properly recorded in the accounting records. Eligibility and rent determination evaluations are performed for new tenants before move-in and annually for existing tenants to determine their portion of rent to pay via the Tenant Income Certification or Re-certification of Permanent Supportive Housing – Eligibility and Rent Determination forms which are approved by the San Diego Housing Commission. Housing program tenants are required to pay up to 30% of their income for rent. Condition: For one out of 12 transactions tested, The Center collected $344.40 which could not be directly traced to an individual tenant. Because it could not be directly traced, the Tenant Income Certification or Re-certification of Permanent Supportive Housing – Eligibility and Rent Determination forms could not be identified and tested for accuracy or completeness and compliance with the tenant’s share of the rental payment could not be determined. Cause: There is no process to regularly review tenant rent payments to ensure that amounts received are matched with a specified tenant and that amounts collected are accurate and agree with the Eligibility and Rent Determination form. Effect: Rent payment was not attributed to an individual tenant. Rent was underpaid by one tenant for multiple months. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: After further investigation, it was determined that one tenant did not pay rent for certain months during fiscal year 2023. Based on a review of client payments and files, it was plausible that the payment received was back rent for this tenant. Repeat Finding: No. Recommendation: The Center should develop a policy for handling payment of tenant rent, including underpayments and overpayments. Rent collected should be compared to the amount determined on the Eligibility and Rent Determination form on a monthly basis to review for inconsistencies and, when differences arise, they should be timely investigated and followed-up on with the appropriate corrective action, per the established policy. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

Program: N/A Criteria: In 2 CFR Part 180, the Uniform Guidance requires that, for covered transactions, the non- Federal entity verify that entities are not suspended, debarred, or otherwise excluded. Condition: While The Center has a policy in place to ensure that its Board members and employees are not suspended, debarred, or otherwise excluded, it does not perform a review for vendors and landlords which may participate in covered transactions. Cause: Certain contracts specify that The Center perform debarment and exclusion checks monthly on all Board members and employees, but do not explicitly state that other parties should also be reviewed. Effect: Without reviewing vendors and landlords for suspension or debarment, there exists the possibility that The Center entered into covered transactions with excluded parties. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: The audit did not identify any transactions with suspended, debarred, or otherwise excluded parties. Repeat Finding: Yes; 2022-003. Recommendation: The Center should expand the current suspension and debarment policy to include review of vendors and landlords. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

2022-002 Program Income Program: 14.267 Continuum of Care Program Criteria: Housing program tenants are required to pay up to 30% of their income for rent. Eligibility and rent determination evaluations are performed for new tenants before move-in and annually for existing tenants to determine their portion of rent to pay. In accordance with 2 CFR 200.307, program income (in this case, tenant rent) must be correctly determined and properly recorded in the accounting records. Condition: For two out of 10 transactions tested, the amount of rent collected by The Center from the tenant was more than the amount determined on the Eligibility and Rent Determination form. Cause: There is no process to regularly review tenant rent to ensure amounts collected are accurate and agree with the Eligibility and Rent Determination form. Effect: One tenant overpaid their tenant portion of rent for a combined $44 during the fiscal year. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: Rent was overpaid by one tenant. Repeat Finding: Yes; 2021-003. Recommendation: The Center should develop a policy for handling underpayments and overpayments of tenant rent. Rent collected should be compared to the amount determined on the Eligibility and Rent Determination form on a monthly basis to review for inconsistencies and, when differences arise, they should be timely investigated and followed-up on with the appropriate corrective action, per the established policy. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

2022-003 Suspension and Debarment Policy Program: N/A Criteria: In 2 CFR Part 180, the Uniform Guidance requires that, for covered transactions, the non-Federal entity verify that entities are not suspended, debarred, or otherwise excluded. Condition: While The Center has a policy in place to ensure that its Board members and employees are not suspended, debarred, or otherwise excluded, it does not perform a review for vendors and landlords which may participate in covered transactions. Cause: Certain contracts specify that The Center perform debarment and exclusion checks monthly on all Board members and employees, but do not explicitly state that other parties should also be reviewed. Effect: Without reviewing vendors and landlords for suspension or debarment, there exists the possibility that The Center entered into covered transactions with excluded parties. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: The audit did not identify any transactions with suspended, debarred, or otherwise excluded parties. Repeat Finding: Yes; 2021-004. Recommendation: The Center should expand the current suspension and debarment policy to include review of vendors and landlords. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

Program: 14.267 Continuum of Care Program Criteria: Housing program tenants are required to pay up to 30% of their income for rent. Eligibility and rent determination evaluations are performed for new tenants before move-in and annually for existing tenants to determine their portion of rent to pay. In accordance with 2 CFR 200.307, program income (in this case, tenant rent) must be correctly determined and properly recorded in the accounting records. Condition: For one out of 11 transactions tested, the amount of rent collected by The Center from the tenant was more than the amount determined on the Eligibility and Rent Determination form. Cause: There is no process to regularly review tenant rent to ensure amounts collected are accurate and agree with the Eligibility and Rent Determination form. Effect: One tenant overpaid their tenant portion of rent by $20. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: Rent was overpaid by $10 for two months in a row, then all subsequent tenant payments were made for the correct amount. Management is currently processing a refund to the tenant for the overpayment amount. Repeat Finding: No. Recommendation: The Center should develop a policy for handling underpayments and overpayments of tenant rent. Rent collected should be compared to the amount determined on the Eligibility and Rent Determination form on a monthly basis to review for inconsistencies and, when differences arise, they should be timely investigated and followed-up on with the appropriate corrective action, per the established policy. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

Program: N/A Criteria: In 2 CFR Part 180, the Uniform Guidance requires that, for covered transactions, the non-Federal entity verify that entities are not suspended, debarred, or otherwise excluded. Condition: While The Center has a policy in place to ensure that its Board members and employees are not suspended, debarred, or otherwise excluded, it does not perform a review for vendors and landlords which may participate in covered transactions. Cause: Certain contracts specify that The Center perform debarment and exclusion checks monthly on all Board members and employees, but do not explicitly state that other parties should also be reviewed. Effect: Without reviewing vendors and landlords for suspension or debarment, there exists the possibility that The Center entered into covered transactions with excluded parties. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: The audit did not identify any transactions with suspended, debarred, or otherwise excluded parties. Repeat Finding: No. Recommendation: The Center should expand the current suspension and debarment policy to include review of vendors and landlords. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.