U.S. flag

An official website of the United States government Here’s how you know

The .gov means it’s official.

Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.

The site is secure.

The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Hotline

Report Fraud, Waste and Abuse
August 14, 2007
  • Housing
2007-AT-1010
ig0741010.pdf

We audited the Cathedral Foundation of Jacksonville, Inc. (Foundation), concerning its involvement as owner and/or manager of four elderly multifamily housing projects (projects) located in Jacksonville, Florida. We conducted the audit based on a request from the Jacksonville Multifamily Housing Hub, U.S. Department of Housing and Urban Development (HUD), Jacksonville, Florida. Our audit objective was to determine whether the Foundation operated the four projects in accordance with HUD's regulatory agreements and other applicable laws, regulations, and requirements.

The Foundation used more than $2.65 million in project funds for questioned costs while the projects had no surplus cash and without required HUD approval. The questioned amount included $1.35 million, which the Foundation repaid itself without HUD approval for project advances and $1.30 million for questioned costs for salaries, fringe benefits, janitorial services, retirement plan, parking fees, and other costs. The questioned costs violated federal statutes, regulations, contracts, and other HUD requirements. The Foundation and subsidized project owners also collected $93,677 in prohibited parking fees from tenants. The prohibited parking fees placed an unjustified financial burden on the tenants. The violations occurred because the Foundation and project owners did not follow HUD's and other requirements.

We recommend that the director of HUD's Jacksonville Multifamily Housing Hub require the Foundation and project owners to deposit to the project's residual receipt accounts more than $2.5 million for ineligible, unreasonable, or unnecessary costs and repay any portion of the $147,277 in unsupported costs that it cannot document as reasonable and necessary costs for the projects. We further recommend that the director require the Foundation and the owners of the projects to reimburse $93,677 to tenants who paid prohibited parking fees. We also recommend that the director of the Departmental Enforcement Center, in coordination with the director of the Multifamily Division, Jacksonville Hub, take appropriate administrative action against the Foundation and project owners for not complying with requirements.