FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS REPORT SAN DIEGO HOUSING COMMISSION SCATTERED SITES HOUSING DEVELOPMENT PROJECT NO.

Transcription

1 FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS REPORT SAN DIEGO HOUSING COMMISSION SCATTERED SITES HOUSING DEVELOPMENT PROJECT NO. 80-RHC-002 JUNE 30, 2005

2 San Diego Housing Commission Scattered Sites Housing Development Project No. 80-RHC-002 TABLE OF CONTENTS PAGE INDEPENDENT AUDITORS REPORT 3 STATEMENT OF PROJECT OPERATIONS 5 SUPPLEMENTAL INFORMATION REQUIRED BY THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT CASH FLOW ANALYSIS 8 OPERATING REVENUE AND EXPENSES 10 OPERATING EXPENSES 12

3 INDEPENDENT AUDITORS REPORT To the Board of Commissioners of the San Diego Housing Commission RE: Scattered Sites Housing Development Project No. 80-RHC-002 We have audited the accompanying statement of project operations of the San Diego Housing Commission s Scattered Sites Housing Development Project No. 80-RHC-002 (the Project) for the year ended June 30, This statement is the responsibility of the Project s management. Our responsibility is to express an opinion on the statement based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying statement of project operations was prepared in conformity with the accounting and reporting practices prescribed by the California Department of Housing and Community Development, which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America. In our opinion, the statement of project operations referred to above presents fairly, in all material respects, the results of operations of the San Diego Housing Commission s Scattered Sites Housing Development Project No. 80-RHC-002 for the year ended June 30, 2005, on the basis of accounting described in note 1. Our audit was conducted for the purpose of forming an opinion on the statement of project operations. The accompanying supplemental information required by the California Department of Housing and Community Development on pages 8 through 13 is presented for purposes of additional analysis and is not a required part of the basic financial statement. Such information, except for that portion marked unaudited, on which we express no opinion has been subjected to the auditing procedures applied in the audit of the basic financial statement and, in our opinion, is fairly stated in all material respects in relation to the basic financial statement taken as a whole

4 This report is intended solely for the information and use of the San Diego Housing Commission and the California Department of Housing and Community Development and is not intended to be and should not be used by anyone other than these specified parties. Sacramento, California December 15,

5 San Diego Housing Commission Scattered Sites Housing Development Project No. 80-RHC-002 STATEMENT OF PROJECT OPERATIONS Year ended June 30, 2005 Revenue Total gross potential rents $ 135,740 Less vacancy loss (756) Total rental income 134,984 Other income Annuity grant income 80,019 Laundry income 6,158 Interest 558 Total revenue 221,719 Operating expenses Management fee 15,368 Administrative expenses 57,899 Utility expenses 31,440 Operating and maintenance expenses 75,984 Insurance and employee benefits 27,574 Total operating expenses 208,265 Income from operations $ 13,

6 San Diego Housing Commission Scattered Sites Housing Development Project No. 80-RHC-002 NOTE TO STATEMENT OF PROJECT OPERATIONS June 30, 2005 NOTE 1 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The statement of project operations of San Diego Housing Commission s Scattered Sites Housing Development Project No. 80-RHC-002 was prepared in conformity with the accounting and reporting practices prescribed by the California Department of Housing and Community Development. These practices differ from accounting principles generally accepted in the United States of America (GAAP). Specifically, the statement of operations does not reflect depreciation expense and interest income earned on restricted reserves. Use of Estimates The preparation of the Statement of Project Operations, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions. Those estimates and assumptions affect the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Annuity Grant Income Grant income is recorded as revenue when received from the State of California to fund budget deficits. Rental Income Rental income is recognized as rentals become due. Rental payments received in advance are deferred until earned. All leases between the Project and the tenants of the Project are operating leases. NOTE 2 - MANAGEMENT FEE The Project incurs a management fee to the San Diego Housing Commission for central office services and includes, but is not limited to bookkeeping, clerical and management overhead expenses, such as salaries and benefits, office supplies and equipment, data processing or computer services, postage, training and telephone services. This does not include the salary of the project manager whether onsite or offsite

7 SUPPLEMENTAL INFORMATION REQUIRED BY THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

8 STATE OF CALIFORNIA HCD RLM 1.4 (REV. 4/01) DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT CASH FLOW ANALYSIS Reporting Period: 7/01/2004 to 6/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 ACCOUNT NAME TOTAL PROJECT Account Unaudited Budget Actual Unaudited Variance Codes (A) (B) (C) REVENUE ACCOUNTS/RENT REVENUE: Rent revenue - gross potential , ,740 (470) 2 Tenant assistance payments Rent revenue - stores and commercial Garage and parking spaces Flexible subsidy revenue Miscellaneous rent revenue Excess rent Rent revenue/insurance Special claims revenue VACANCIES: 5200 Vacancy Percentages: 3.00% 0.56% 2.44% 11 Apartments , , Stores and commercial Rental concessions Garage and parking spaces Miscellaneous Total vacancies 5200T 4, ,330 Net rental revenue 5152T 132, ,984 2,860 ASSISTED LIVING/BOARD & CARE REVENUES: Food Recreation (activities) and rehabilitation Rehabilitation Other service revenue Total living revenue 6300T FINANCIAL REVENUE: Financial revenue - project operations (110) 21 Revenue from investments - operating reserves Revenue from investments - residual receipts Revenue from investments - replacement reserves Revenue from investments - miscellaneous Total financial revenue 5400T (110) OTHER REVENUE: Laundry and vending revenue ,005 6,158 3, NSF and late charges Damages and cleaning fees Forfeited tenant security deposits Other revenue Transfer from replacement reserve account Transfer from operating reserve account Total other revenue 5900T 3,005 6,158 3,

9 STATE OF CALIFORNIA HCD RLM 1.4 (REV. 4/01) DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT CASH FLOW ANALYSIS Reporting Period: 7/01/2004 to 6/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 ACCOUNT NAME TOTAL PROJECT Account Unaudited Budget Actual Unaudited Variance Codes (A) (B) (C) EFFECTIVE GROSS RENT (EGR) 5152T 135, ,700 5,903 TOTAL OPERATING EXPENSES , ,265 6 NET OPERATING INCOME (NOI) 5000 (72,462) (66,565) 5,897 FINANCIAL EXPENSES: Debt service 1st Mortgage = nd Mortgage= rd Mortgage= HCD required payments Lease payment Miscellaneous financial expenses Total financial expenses 6800T FUNDED RESERVES: Escrow deposits Replacement reserve - deposit ,557 7, Operating reserve- deposit Other reserves # # # Revenue from investments - operating reserves Revenue from investments - replacement reserves Revenue from investments - miscellaneous Total reserves 7,557 7, TOTAL OPERATING EXPENSES 6000T 208, ,265 (6) 43 TOTAL CASH FLOW (80,019) (74,122) 5, HCD interest payments Asset management fee (CHRP-R/SUHRP/HOME only) Annuity fund request (RHCP- original only) 80,019 80, Borrower contributions Borrower distributions Residual receipt loan payments HCD Use Only: Annuity payment of $80,019 for the fiscal year from July 1, 2004 to June 30, 2005 is approved for payment from the RHCP Annuity Monitoring and Management Program Representative Department of Housing and Community Development Date Monitoring and Management Program Manager Department of Housing and Community Development Date - 9 -

10 HCD RLM 1.2 (REV. 7/01) Operating Revenue and Expenses Reporting Period: 07/01/2004 to 06/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 TOTAL REVENUE ACCOUNT NAME UNAUDITED BUDGET ACTUAL UNAUDITED VARIANCE ANNUAL ANNUAL ANNUAL (A) (B) (C) Rental revenue 132, ,984 2,860 Financial revenue (110) Laundry revenue 3,005 6,158 3,153 RHCP annuity payment 80,019 80,019 0 Interest income Transfer from replacement reserve Recovery of uncollectible rent (net) Total income 215, ,719 5,903 TOTAL EXPENSES MANAGEMENT FEE: 6200/ Management fee 15,367 15,368 (1) ADMINISTRATIVE EXPENSES: 6200/ Advertising and marketing Apartment resale expense (cooperatives) Other renting expenses (credit checks, photography) Office salaries 20,758 22,062 (1,304) 6 Office supplies 2,445 3,431 (986) 7 Office or model apartment rent Manager and superintendent salaries 10,978 10, Manager's and superintendent's rent free unit Legal expense - project Audit expense- project Bookkeeping fees/accounting services 16,009 16,010 (1) 13 Telephone and answering service expenses Bad debt expense 1,350 1,658 (308) 15 Miscellaneous administrative expenses (specify) 4,176 3, TOTAL ADMINISTRATIVE EXPENSES 56,592 57,899 (1,307) UTILITIES EXPENSES: Fuel oil/coal Electricity 2,155 1, Water 21,777 17,602 4, Gas 12,594 12, Sewer TOTAL UTILITIES EXPENSES 36,526 31,440 5,086 OPERATING AND MAINTENANCE EXPENSES: Janitor and cleaning payroll Janitor and cleaning supplies Janitor and cleaning contracts 6,780 11,014 (4,234) 26 Exterminating payroll/contract 1, Exterminating supplies Garbage and trash removal 2,280 3,142 (862) 29 Security payroll/contract Grounds payroll Grounds supplies Grounds contract 3,400 5,114 (1,714) 33 Repairs payroll 17,696 18,895 (1,199) 34 Repairs materials 8,412 5,020 3, Repairs contract 14,255 21,285 (7,030) 36 Elevator maintenance/contract Heating/cooling repairs and maintenance Swim pool maintenance/contract Snow removal Decorating/payroll contract 4,000 6,833 (2,833) 41 Decorating supplies Vehicle and maint. equipment operation/repairs 1,511 1, Misc. operating and maintenance expenses 6,300 2,141 4, TOTAL OPERATING AND MAINTENANCE EXPENSES 66,234 75,984 (9,750)

11 HCD RLM 1.2 (REV. 7/01) Operating Revenue and Expenses Reporting Period: 07/01/2004 to 06/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 TOTAL REVENUE ACCOUNT NAME UNAUDITED BUDGET ACTUAL UNAUDITED VARIANCE ANNUAL ANNUAL ANNUAL (A) (B) (C) TAXES AND INSURANCE: Real estate taxes Payroll taxes (project's share) Misc. taxes, licenses, permits and insurance Property and liability insurance (hazard) 6,383 5, Fidelity bond insurance Worker's compensation Health insurance/other employee benefits 20,897 21,619 (722) 52 Other insurance (107) 53 TOTAL TAXES AND INSURANCE 27,474 27,574 (100) ASSISTED LIVING/BOARD AND CARE EXPENSES; Food Recreation and rehabilitation Rehabilitation salaries Other service expenses TOTAL ASSISTED LIVING EXPENSES SUBTOTAL OPERATING EXPENSES 202, ,265 (6,072) 60 CONTINGENCY RESERVE: 6,066 6, EXPENSES PAID FROM REPLACEMENT RESERVES TOTAL OPERATING EXPENSES 208, ,265 (6) REPLACEMENT RESERVE DEPOSIT 7,557 7,557 0 SIGNATURES: San Diego Housing Commission Management Borrower Sponsor (Local Agency) By By By DEPARTMENTAL APPROVAL: Department of Housing and Community Development By

12 STATE OF CALIFORNIA HCD RLM 1.2 (REV. 7/01) DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT Operating Expenses Reporting Period : 07/01/2004 to 06/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 ACCOUNT NAME TOTAL EXPENSES UNAUDITED APPROVED BUDGET ACTUAL ACCOUNT ANNUAL PUM ANNUAL PUM CODES (A) (B) (C) (D) MANAGEMENT FEE: 6200/ Management fee , , ADMINISTRATIVE EXPENSES: 6200/ Advertising and marketing Apartment resale expense (cooperatives) Other renting expenses (credit checks, photography) Office salaries , , Office supplies , , Office or model apartment rent Manager and superintendent salaries , , Manager's and superintendent's rent free unit Legal expense - project Audit expense- project Bookkeeping fees/accounting services , , Telephone and answering service expenses Bad debt expense , , Miscellaneous administrative expenses (specify) , , TOTAL ADMINISTRATIVE EXPENSES 6200/6300T 56, , UTILITIES EXPENSES: Fuel oil/coal Electricity , , Water , , Gas , , Sewer TOTAL UTILITIES EXPENSES 6400T 36, , OPERATING AND MAINTENANCE EXPENSES: Janitor and cleaning payroll Janitor and cleaning supplies Janitor and cleaning contracts , , Exterminating payroll/contract , Exterminating supplies Garbage and trash removal , , Security payroll/contract Grounds payroll Grounds supplies Grounds contract , , Repairs payroll , , Repairs materials , , Repairs contract , , Elevator maintenance/contract Heating/cooling repairs and maintenance Swim pool maintenance/contract Snow removal Decorating/payroll contract , , Decorating supplies Vehicle and maint. equipment operation/repairs , , Misc. operating and maintenance expenses , , TOTAL OPERATING & MAINTENANCE EXPENSES 6500T 66, ,

13 STATE OF CALIFORNIA HCD RLM 1.2 (REV. 7/01) DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT Operating Expenses Reporting Period : 07/01/2004 to 06/30/2005 Contract: 80-RHC-002 Units/Sq. Ft. - Assisted: 38 Project Name: San Diego Housing Commission's Scattered Sites Units/Sq. Ft. - Total: 38 Prepared by: Judy F. Elizondo Unit Months: 456 Date Prepared: 09/30/2005 ACCOUNT NAME TOTAL EXPENSES UNAUDITED APPROVED BUDGET ACTUAL ACCOUNT ANNUAL PUM ANNUAL PUM CODES (A) (B) (A) (B) TAXES AND INSURANCE: Real estate taxes Payroll taxes (project's share) Misc. taxes, licenses, permits and insurance Property and liability insurance (hazard) , , Fidelity bond insurance Worker's compensation Health insurance/other employee benefits , , Other insurance TOTAL TAXES AND INSURANCE 6700T 27, , ASSISTED LIVING/BOARD & CARE EXPENSES; Food Recreation and rehabilitation Rehabilitation salaries Other service expenses TOTAL ASSISTED LIVING EXPENSES 6900T SUBTOTAL OPERATING EXPENSES 202, , CONTINGENCY RESERVE: 3.00% 6, EXPENSES PAID FROM REPLACEMENT RESERVES EXPENSES PAID FROM OPERATING RESERVES TOTAL OPERATING EXPENSES 6000T 208, , SIGNATURES: San Diego Housing Commission Management By Manager of Financial Services Title Date Borrower By Title Date Sponsor (Local Agency) By Title Date DEPARTMENTAL APPROVAL: Department of Housing and By Title Date Community Development