We are conducting an audit survey of Saltillo Assisted Living (project) based on a referral from the U.S. Department of Housing and Urban Development’s (HUD) Departmental Enforcement Center and the activities included in our 2015 annual audit plan.  Our survey objective is to determine whether the owners and management agents of Saltillo Assisted Living complied with the executed regulatory agreement and HUD’s requirements.  Our preliminary results identified significant condition that we want to bring to your attention immediately.

The owners and operators of the project did not follow HUD’s requirements to carry liability and property insurance. According to the onsite management, the cancellation of insurance was caused by a lack of available project funds.  Possible injury to the residents, damage to the property, or lawsuits put the project’s residents and HUD at unnecessary risk.

We recommend that the Director of the Office of Residential Care Facilities enforce HUD’s requirements for owners and operator to immediately obtain and maintain liability and property insurance on the project, or take other administrative action as appropriate.