HOUSTON RHF HOUSING, INC. DBA CREEKBEND GARDENS 114-EE052

Assistance Listing title and number (federal award identification and year): Supportive Housing for the Elderly, Assistance Listing No. 14.157 (Project identification number 114-EE052 and 1999) Auditor non-compliance code: Z - Other Finding resolution status: Resolved Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size is not applicable to the finding. Statistically valid sample: N/A Name of Federal Agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $24,300 Statement of Condition 2025-001 (Assistance Listing 14.157): During the year ended January 31, 2025, HUD approved $83,950 of withdrawals as a pre-release to pay for HVAC replacements and boilers at the Property. The Corporation used $24,300 of the pre-release to fund operations, instead of paying the invoices approved by HUD and had not paid as of January 31, 2025. Criteria: Pursuant to Section 5 of the Regulatory Agreement, the Corporation may only make disbursements from the reserve for replacements for payments of amounts as approved by HUD. Effect: The Corporation is not in compliance with the Regulatory Agreement. Cause: Due to cash flow shortages, the Corporation was unable to use reserve for replacement withdrawals in the manor approved by HUD. Recommendation: Management should ensure that HUD approved reserve for replacement withdrawals are used for the approved purposes. Completion Date: March 3, 2025 Management Response: Agree. The Corporation paid the remaining costs included in the HUD approved withdrawal on March 3, 2025. There is no further action required.

Statement of Condition 2025-001 (Assistance Listing 14.157): During the year ended January 31, 2025, HUD approved $83,950 of withdrawals as a pre-release to pay for HVAC replacements and boilers at the Property. The Corporation used $24,300 of the pre-release to fund operations, instead of paying the invoices approved by HUD and had not paid as of January 31, 2025. Recommendation: Management should ensure that HUD approved reserve for replacement withdrawals are used for the approved purposes. Management Response: Agree. The Corporation paid the remaining costs included in the HUD approved withdrawal on March 3, 2025. There is no further action required.

Auditor non-compliance code: Z - Other Finding resolution status: Resolved Universe population size: 64 tenant files Sample size information: 7 tenant files Statistically valid sample: N/A Name of Federal Agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of Condition 2025-002 (Assistance Listing 14.157): During the year ended January 31, 2025, 1 move-out resident file selected for testing under the compliance supplement were missing necessary documents required by the PRAC and HUD Handbook 4350.3. Criteria: In accordance with the PRAC and HUD Handbook 4350.3, the Property must retain EIV reports, resident provided documentation, third party verification, and related supporting documentation in the resident file for the term of the tenancy plus three years. Effect: The Property is not in compliance with the terms of the PRAC or HUD Handbook 4350.3. Current, future, and potentially prior funding under the PRAC could be impacted as a result of these resident files. Cause: Due to the Property not having a manager, the resident did not sign the selected documents before the resident moved out. Recommendation: Management should ensure that all resident files are maintained at the site for each resident of the Property in accordance with the HUD Handbook 4350.3. Completion Date: June 13, 2024 Management Response: Management agrees with the recommendation and will ensure that resident files are retained in accordance with the HUD Handbook 4350.3. The resident moved-out on June 13, 2024. No further action is required.

Statement of Condition 2025-002 (Assistance Listing 14.157): During the year ended January 31, 2025, 1 move-out resident file selected for testing under the compliance supplement were missing necessary documents required by the PRAC and HUD Handbook 4350.3. Recommendation: Management should ensure that all resident files are maintained at the site for each resident of the Property in accordance with the HUD Handbook 4350.3. Management Response: Management agrees with the recommendation and will ensure that resident files are retained in accordance with the HUD Handbook 4350.3. The resident moved-out on June 13, 2024. No further action is required.

Finding reference number: 2024-001 Assistance Listing title and number (federal award identification and year): Supportive Housing for the Elderly, Assistance Listing No. 14.157 (Project identification number 114-EE052 and 1999) Auditor non-compliance code: N – Reserve for Replacements Deposits Finding resolution status: Resolved Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size is not applicable to the finding. Statistically valid sample: N/A Name of Federal Agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $3,300 Statement of Condition 2024-001 (Assistance Listing 14.157): The Corporation did not make all of the HUD required reserve for replacements deposits for the year ended January 31, 2024. Criteria: Pursuant to Section 5 of the Regulatory Agreement and Section 2.6 (c) of the PRAC, the Corporation is required to make monthly deposits to the reserve for replacements fund as required by HUD. Effect: The Corporation is not in compliance with the Regulatory Agreement and the PRAC. The reserve for replacements is underfunded by $3,300 at January 31, 2024. Cause: Due to a delay in the approval of the PRAC renewal, the required deposit of $3,300 for January 2024 was not made. Recommendation: Management should transfer $3,300 from the operating cash account to the reserve for replacements fund. Completion Date: February 28, 2024 Management Response: Agree. On February 28, 2024, management transferred $3,300 from the operating cash account to the reserve for replacements fund. No further action is required.

Finding 2024-001: The Corporation did not make all of the HUD required reserve for replacements deposits for the year ended January 31, 2024. Comments on the Finding and Each Recommendation: Management should transfer $3,300 from the operating cash account to the reserve for replacements fund. Action(s) taken or planned on the finding: Agree. On February 28, 2024, management transferred $3,300 from the operating cash account to the reserve for replacements fund. No further action is required.

Assistance Listing title and number (federal award identification and year): Supportive Housing for the Elderly, Assistance Listing No. 14.157 (Project identification number 114-EE052 and 1999) Auditor non-compliance code: R – Section 8 Program Administration Finding resolution status: Resolved Universe population size: 74 residents Sample size information: 8 resident files Statistically valid sample: Yes Name of Federal Agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of Condition 2023-001 (Assistance Listing 14.157): During the year ended January 31, 2023, 3 of the move-out resident files selected for testing under the Compliance Supplement were missing necessary documents required by the PRAC and HUD Handbook 4350.3. Criteria: In accordance with the Project Rental Assistance Contract ("PRAC") and HUD Handbook 4350.3, the Property must retain EIV reports, resident provided documentation, third party verification, and related supporting documentation in the resident file for the term of the tenancy plus three years. Effect: The Property is not in compliance with the terms of the PRAC or HUD Handbook 4350.3. Current, future, and potentially prior funding under the PRAC could be impacted as a result. Cause: The prior property manager discarded the selected resident files before the end of the document retention period. Recommendation: Management should ensure that all resident files are maintained at the site for each resident of the Property in accordance with the HUD Handbook 4350.3. Completion date: May 12, 2023 Management Response: Management agrees with the recommendation and will ensure that resident files are retained in accordance with the HUD Handbook 4350.3. Management will review and update all resident files as necessary to ensure the Property is in compliance.

Statement of Condition 2023-001 (Assistance Listing 14.157): During the year ended January 31, 2023, 3 of the move-out resident files selected for testing under the Compliance Supplement were missing necessary documents required by the PRAC and HUD Handbook 4350.3. Recommendation: Management should ensure that all resident files are maintained at the site for each resident of the Property in accordance with the HUD Handbook 4350.3. Management Response: Management agrees with the recommendation and will ensure that resident files are retained in accordance with the HUD Handbook 4350.3.

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION