House by House Reservation Rehabilitation Program Changes

June 29,2015

2 CFR Part 200 aka OMBs

• What is it???• How it affects you…..

– Cost Allocation Plans – Direct vs Indirect Costs– MFA oversight requirements

• …..Which ultimately affects sub-grantees

• Audit Requirements• Coming soon

• Data Act• Changes to Section 3

Audit Requirement Change• Agencies must provide either an Independent Financial Audit or Audited

Financial Statements. Both must contain a report on the financial statements and internal control and compliance. If applicable, a management letter addressing audit findings.

• Single Audit Threshold has changed. Beginning with Fiscal Year ending in 2015, the threshold was increased to $750,000 in one or more sources of Federal funding (was $500,000).

• Only local public bodies (local governments, housing authorities, etc.) are required to conduct annual independent financial audits by a certified auditor that has been approved by the New Mexico State Auditor’s Office and on the State Auditor’s List.

• All entities must at a minimum procure for auditing firm/services every 3 years, through a RFP and provide evidence of the procurement to MFA at the time of re-certification. Entity may still choose the same auditor if their response is more cost effective.

Program Requirements• Subsidy amounts – Maximum amount is $65,000

– Hard construction costs capped at $55,000

– Soft costs capped at $10,000 to offset:• Direct project related salaries for Project/Program Manager, Administrative

Assistant, Construction Manager to prepare:

– Work write-ups, cost estimates

– Bid Documents, bid opening

– Environmental review

– Progress inspections

• Fees:

– Title Search

– Appraisal

– Recording fees for Covenants/Tribal Land Award Agreements

– Admin fee capped at 3%

Program Requirements

• Current Eligible Partners may have up to three (3) projects open at one time.

• New Eligible Partners have to complete one project to start. If funding allows, they may submit for another project upon completion of their initial project.

• All projects must be completed and closed out by MFA within 180 days. Projects not invoiced within the first 90 days may be subject to cancellation by MFA.

• Eligible partners are responsible for guaranteeing that the work is inspected and completed

– Progress reports with pictures are required for all requests for reimbursement for hard construction costs.

– Time for project management must be project specific, dated and signed by personnel and supervisor/manager

Uniform Physical Conditions Standards

• What is UPCS– In the absence of State or Local building code, it is the minimum

standard that must be used when assessing a potential home for the Rehab program

– Replaces Housing Quality Standards (HQS)

– New Checklist and Manual

– Not a Pass/Fail system

– Levels of deficiencies• NOD – no observable deficiency• Levels 1, 2, 3 • N/A• Health and Safety

– Non-life threatening– Life threatenting

Uniform Physical Conditions Standards

• 5 areas of inspection– Building Exterior

• Foundations• Roof• Walls

– Building Systems• Domestic Water• Sanitary

– Unit – all rooms inside the home, interior systems such as electrical and HVAC, HWH

– Health and Safety

– Additional inspection items

Uniform Physical Conditions Standards

• Checklist example:

Inspectable Area: Unit

Level

Inspectable Item Observable Deficiency NOD 1 2 3 NA H&S

Bathroom Pages 10-11 Bathroom Cabinets - Damaged/Missing            

  Lavatory Sink - Damaged/Missing           NLT

  Plumbing - Clogged Drains           NLT

  Plumbing - Leaking Faucet/Pipes           NLT

 Shower/Tub - Damaged/Missing

          NLT

 Ventilation/Exhaust System - Inoperable

           

  Water Closet/Toilet - Damaged/Clogged/Missing           NLT

Uniform Physical Conditions Standards

• Manual exampleBathroom - A room equipped with a water closet or toilet, tub and/or shower, sink, cabinet(s) and/or closet. This item can have the following deficiencies: Bathroom Cabinets - Damaged/Missing Lavatory Sink - Damaged/Missing Plumbing - Clogged Drains Plumbing - Leaking Faucet/Pipes Shower/Tub - Damaged/Missing Ventilation/Exhaust System - Inoperable Water Closet/Toilet - Damaged/Clogged/Missing

Bathroom Cabinets - Damaged/Missing Deficiency: You see damaged or missing cabinets, vanity tops, drawers, shelves, doors, medicine cabinets, or vanities. Level of Deficiency: Level 1: You see damaged or missing shelves, vanity tops, drawers, or doors that are not functioning as they should for storage or their intended purpose. Level 2: N/A Level 3: N/A Lavatory Sink - Damaged/Missing Deficiency: A basin (sink) is missing or shows signs of deterioration or distress. Level of Deficiency: Level 1: N/A Level 2: N/A Level 3: The sink cannot be used, because the sink or associated hardware is missing or has failed.