DES MOINES RHF HOUSING, INC. DBA VIRGINIA PARK APARTMENTS #074-EH184

Assistance Listing title and number (federal award identification and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181 (Project identification number 074-EH184 and IA05Q881007 and 1992) Auditor non-compliance code: N - Reserve for Replacements Deposits Finding resolution status: Cleared Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information 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: $19,200 Statement of Condition 2024-001 (Assistance listing 14.181): The Corporation did not make all of the HUD required reserve for replacement deposits for the year ended October 31, 2024. Criteria: Pursuant to Section 5 of the Regulatory Agreement, the Property 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 reserve for replacements is underfunded by $19,200 at October 31, 2024. Cause: Due to cash flow shortages, the deposits to the reserve for replacements for the year ended October 31, 2024 were $19,200 less than the deposits required by HUD. Recommendation: Management should transfer $19,200 from the operating cash account to the reserve for replacements fund or request a suspension of monthly deposits from HUD. Completion date: January 9, 2025 Management Response: Agree. On January 9, 2025, management transferred $19,200 from the operating account to the reserve for replacements fund.

Assistance Listing title and number (federal award identification and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181 (Project identification number 074-EH184 and IA05Q881007 and 1992) Auditor non-compliance code: Z - Other Finding resolution status: Cleared Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information 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: N/A Statement of Condition 2024-002 (Assistance listing 14.181): The Property received a Management Occupancy Review (MOR) rating of Below Average and is unable to locate a response to HUD correcting the findings in the MOR. Criteria: Pursuant to Chapter 6 of the HUD Asset Management Handbook (4350.1 REV-1), deficiencies identified in a MOR must be corrected within 30 calendar days or as otherwise stipulated in the corrective action plan provided. Effect: In accordance with the HUD Handbook, if the HUD field office determines that a good faith effort had not been made to correct deficiencies, the HUD field office can refer the property to Senior Project Manager for troubled projects or to the DEC for enforcement action. Additionally, the property could be found to be in violation of the Project Rental Assistance Contract. Cause: Management believes they responded to all findings within an appropriate time frame, but were unable to find support and never received a close out letter from HUD. Management resent the responses to the findings on January 24, 2025. Recommendation: Management should clear all findings from the MOR and follow up with HUD to request a close-out letter. Completion date: January 24, 2025 Management Response: Agree. On January 24, 2025, management responded to the MOR findings and believes they have adequately addressed all deficiencies. No further action is required.

Assistance Listing title and number (federal award identification and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181 (Project identification number 074-EH184 and IA05Q881007 and 1992) Auditor non-compliance code: Z - Other Finding resolution status: Universe population size: 28 resident files Sample size information: 3 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 14.181): During the year ended October 31, 2023, 1 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: January 12, 2024 Management Response: Management agrees with the recommendation and will ensure that resident files are retained in accordance with the terms of the PRAC and HUD Handbook 4350.3.

Finding reference number: 2021-001 CFDA title and number (Federal award identification number and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181 (074-EH184 and 1992) Auditor non-compliance code: I ? Failure to maintain property / open physical inspection Finding resolution status: In process Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: No Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of Condition 2021-001 (Assistance Listing No. 14.181): The Property received a score of 41c* on a physical inspection of the Property performed on August 6, 2021 by a representative of HUD. By reference, the REAC inspection is included in the statement of condition. Criteria: Pursuant to the HUD Regulatory Agreement and Project Rental Assistance Contract, the Property is to be maintained in good repair and condition and considered decent, safe, and sanitary. Management is to conduct routine unit and general property inspections and deficiencies should be corrected. Effect: The Corporation is not in compliance with the Regulatory Agreement and Project Rental Assistance Contract. If deficiencies are of a life-threatening nature and not corrected in a timely manner, the units could be considered not to be in a decent, safe, and sanitary condition and the PRAC could be terminated. Cause: The Property manager was not using the Uniform Physical Condition Standards Comprehensive Listing Checklist to ensure the Corporation was in compliance with HUD requirements when completing self-inspections. Recommendation: Management should ensure all necessary repairs have been made. Management should continue to conduct routine unit and general property inspections and deficiencies should be corrected in a timely manner. Management Response: Agree. Management has responded to HUD regarding this inspection report and has addressed all health and safety issues. Management has corrected all remaining deficiencies noted, except the HVAC repairs, and will implement a process of self-inspection of units and common areas. The Agent continues to work with HUD to complete the required HVAC repairs. A response has yet to be received from HUD indicating all deficiencies have been corrected.

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