Exhibit C:
ESG Match Follow-Up Questions and Match Exclusions
Please identify ESG Matching Funds (eligible Match Funds only) by name of the funding source and dollar amount. Please also provide answers to the below questions.
Source of ESG Match Funds
(Eligible Match Only. Please be specific.)
Dollar ($) Amount of Match
Day 1 Families $339.589
$
$
$
$
$
$
$
$
$
TOTAL $ 339,589
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
Please review the Match statements below and indicate whether they are correct or not.
In general, Federal, State, local, or private funds, other than ESG, may be used to satisfy the requirement that the subrecipient provide matching contributions to City of Fresno ESG funding, so long as the following conditions are met:
1. The matching funds to be contributed to the activity described in the NOFA Part B Application will be exclusively expended on the subrecipient’s described activity and is an allowable ESG costs.
Yes
No
2. The matching funds will not be expended before the commencement date of the applicable ESG subrecipient agreement.
Yes
No
3. The matching funds will be expended by the expenditure deadline that applies to the ESG funds being matched.
Yes
No
4. The matching funds have not been, and will not be, used to match any other Federal program’s funds nor any other ESG grant.
Yes
No
5. The subrecipient does not use ESG funds to meet another program's matching requirement.
Yes
No
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
6. The subrecipient will keep records of the source and use of the matching funds, including the fiscal year of the ESG grant for which the matching contribution is counted.
Yes
No
Note: Because the matching funds are contributed to the ESG program and expended for the subrecipient’s allowable ESG costs, the following are not allowed to be used as match:
SNAP benefits (food stamps) because the funds are being used to cover the program participant’s costs;
Housing Choice Vouchers, because the funds are used to pay the PHA’s obligations under its Housing Assistance Payment contract with the owner; and The tenant’s portion of the rent because this amount is the tenant’s obligation.
Please also note the following:
The matching funds are provided based on the total grant amount and do not have to be provided on a component-by-component basis.
HOME-TBRA funds cannot be used as a match because the requirements for rental assistance are significantly different between the two programs. In particular, under the HOME-TBRA program (24 CFR parts 92.209 and 92.253), subrecipient(s) may not require a program participant to accept any services (subrecipient may offer services but cannot require them). In contrast, when providing ESG homelessness prevention or rapid re-housing assistance to a program participant, the recipient or subrecipient must require the program participant to meet with a case manager not less than once per month to assist the program participant in ensuring long-term housing stability and develop a plan to assist the program participant to retain permanent housing after the ESG assistance ends (24 CFR 576.401(e)). Because of these differences in the two programs, HOME-TBRA funds may not be used as Match for the ESG funds.
SHP funds generally cannot be used as a match, because very few activity costs are allowable under both SHP and ESG. However, in some cases, such as where SHP funds are used for HMIS or street outreach costs that are allowable under ESG, SHP funds can be counted as match in accordance with conditions 1-8 above.
Please note, however, that HMIS costs are only eligible to be used as match under ESG if they are eligible under section 576.107 and allocable to the ESG program, whether charged as direct costs or indirect costs. If the SHP HMIS funds are being used to pay for SHP projects’ data entry, those data entry costs are not allocable to the ESG program, and the funds used cannot be counted as match.
WESTCARE CALIFORNIA, INC.
FINANCIAL STATEMENTS
AND SUPPLEMENTAL INFORMATION
JUNE 30, 2022
WESTCARE CALIFORNIA, INC.
REPORT ON FINANCIAL STATEMENTS
JUNE 30, 2022
TABLE OF CONTENTS
PAGE
Independent Auditor’s Report 1-2
Financial Statements:
Statement of Financial Position 3
Statement of Activities 4
Statement of Cash Flows 5
Statement of Functional Expenses 6
Notes to the Financial Statements 7-13
Supplemental and Other Information:
Schedule of Expenditures of Federal Awards 14
Notes to Schedule of Expenditures of Federal Awards 15
Schedule of Findings and Questioned Costs 16
Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 17-18
Independent Auditor’s Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance 19-20
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of WestCare California, Inc.’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about WestCare California, Inc.’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole.
The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards is presented for purposes of additional analysis and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 3, 2023, on our consideration of WestCare California, Inc.’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering WestCare California, Inc.’s internal control over financial reporting and compliance.
Fresno, California
January 3, 2023
2 WESTCARE CALIFORNIA, INC.
STATEMENT OF FINANCIAL POSITION
JUNE 30, 2022
ASSETS
Cash and Cash Equivalents $ 7,711
Grant Contracts Receivable 10,509,418
Prepaid Expenses 239,527
Cash Restricted for Client Funds 162,218
Due from Related Organization 4,635,992
Property and Equipment, Net 4,306,494
Total Assets $19,861,360
LIABILITIES
Accounts Payable and Accrued Expenses $ 5,839,209
Accrued Salaries and Related Expenses 1,581,572
Due to Clients (Contra) 114,609
Deferred Revenue 3,292,252
Total Liabilities $10,827,642
NET ASSETS
Without Donor Restrictions 9,033,718
Total Net Assets 9,033,718
Total Liabilities and Net Assets $19,861,360
See accompanying notes to financial statements
3 WESTCARE CALIFORNIA, INC.
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2022
Change in Net Assets Without Donor Restrictions
Revenues and Other Support
Federal Contract Revenue $ 9,358,049
State Contract Revenue 5,334,568
STOP Contract 10,142,365
STOP Aftercare 20,423,500
County Contract Revenue 12,162,117
City Contract Revenue 1,121,616
Other Contract Revenue 716,135
Client Fees 1,851,088
Donations and Gifts 42,087
Other Revenue 27,088
Total Revenues and Other Support
Without Donor Restrictions $ 61,178,613
Expenses
Program Services
Grants and Program Support 51,520,272
Total Program Services 51,520,272
Supporting Services
General and Administrative 9,078,077
Total Supporting Services 9,078,077
Total Expenses 60,598,349
Change in Net Assets Without Donor Restrictions 580,264 Net Assets, Beginning of Year 8,453,454
Net Assets, End of Year $ 9,033,718
See accompanying notes to financial statements
4 WESTCARE CALIFORNIA, INC.
STATEMENT OF CASH FLOWS
JUNE 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Change in Net Assets Without Donor Restrictions $ 580,264 Adjustments to Reconcile Change in Net Assets
To Net Cash Provided by Operating Activities:
Depreciation 330,247
(Increase) or Decrease in:
Grants Receivable (1,087,727)
Prepaid Expenses (33,578)
Increase or (Decrease) in:
Accounts Payable and Accrued Expenses 1,409,964
Accrued Salaries and Related Expenses 123,070
Clients Funds (Contra) (132,480)
Deferred Revenue (307,326)
Net Cash Provided/(Used) in Operating Activities $ 882,434 CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Property and Equipment ( 69,187)
Net Cash Provided/(Used) in Investing Activities (69,187) CASH FLOWS FROM FINANCING ACTIVITIES:
Advances to Related Organization (2,131,535)
Net Cash Provided/(Used) in Financing Activities (2,131,535) Net Increase (Decrease) in Cash, Cash Equivalents, and
Restricted Cash (1,318,288)
Beginning Cash, Cash Equivalents, and Restricted Cash 1,487,217 Ending Cash, Cash Equivalents, and Restricted Cash $ 169,929 Supplemental Disclosure:
Interest Paid $ --
See accompanying notes to financial statements
5 GENERAL
FEDERAL STATE LOCAL OTHER PROGRAM TOTAL AND TOTAL
GRANTS GRANTS GRANTS GRANTS SUPPORT PROGRAM FUNDRAISING ADMINISTRATIVE EXPENSES
SALARIES AND RELATED EXPENSES
Salaries $ 2,923,784 $ 6,199,189 $ 7,943,024 $ 193,808 $ 203,969 $ 17,463,774 $ - $ 924,371 $ 18,388,145 Payroll taxes and employee benefits 454,631 554,915 806,364 15,463 15,894 1,847,267 - 2,190,360 4,037,627 TOTAL SALARIES AND RELATED EXPEN 3,378,415 6,754,104 8,749,388 209,271 219,863 19,311,041 - 3,114,731 22,425,772
OTHER EXPENSES
Building occupancy 234,203 754,990 508,618 27,742 29,651 1,555,204 66,492 1,621,696 Travel 15,295 86,262 41,242 5,915 317 149,031 26,347 175,378 Equipment costs 103,385 163,685 97,217 56,538 11,125 431,950 31,877 463,827 Repair and maintenance 38,504 143,869 115,095 3,890 4,260 305,618 25,460 331,078 Vehicles 197,991 168,920 205,800 33,892 2,521 609,124 3,668 612,792 Food costs 11,256 593,113 504,319 156 39 1,108,883 2,690 1,111,573 Program assistance and supplies 3,906,303 863,666 1,272,471 204,017 8,443 6,254,900 15,300 6,270,200 Purchased aftercare 20,423,500 20,423,500 - 20,423,500
Interest and taxes 15,699 5,339 3,931 1,816 531 27,316 20,960 48,276 Operating supplies and expenses 166,379 294,718 257,453 21,288 34,604 774,442 765,052 1,539,494 Legal settlements - - - - - - 67,300 67,300
Professional services 44,315 113,181 172,138 45,503 604 375,741 307,171 682,912 Management and administration - - - - - - 4,494,304 4,494,304 TOTAL OTHER EXPENSES 4,733,330 23,611,243 3,178,284 400,757 92,095 32,015,709 - 5,826,621 37,842,330
TOTAL EXPENSES BEFORE
DEPRECIATION 8,111,745 30,365,347 11,927,672 610,028 311,958 51,326,750 - 8,941,352 60,268,102 Depreciation 1,184 34,882 144,379 - 13,077 193,522 - 136,725 330,247 TOTAL EXPENSES $ 8,112,929 $ 30,400,229 $ 12,072,051 $ 610,028 $ 325,035 $ 51,520,272 $ - 9,078,077 $ 60,598,349 See accompanying notes to financial statements.
WestCare California, Inc.
STATEMENT OF FUNCTIONAL EXPENSES
Year Ended June 30, 2022
6 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 1 – ORGANIZATION AND NATURE OF ACTIVITIES:
Organization and Nature of Activities: WestCare California, Inc. is a tax exempt, nonprofit corporation governed by a volunteer board of directors incorporated in 1999 whose purposes include, but are not limited to the following:
A. To promote public awareness about chemical dependency and related issues and problems; and,
B. To promote recovery from chemical dependency and or related illnesses, through developing, establishing and/or maintaining of centers for the rehabilitation of individuals and their families.
C. To promote the health and well being of all citizens.
The Organization provides residential and out-patient rehabilitation programs, criminal justice programs, health related and a variety of prevention programs and services all of which are related to the purposes for which it is established.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting: The accompanying financial statements of the Organization have been prepared on the accrual basis in accordance with accounting principles generally accepted in the United States of America.
Basis of Presentation: Net assets and revenues, expenses, gains, and losses are classified based on the existence or absence of donor-imposed restrictions.
Accordingly, net assets of the Organization and changes therein are classified as follows:
Net assets without donor restrictions: Net assets that are not subject to donorimposed restrictions and may be expended for any purpose in performing the primary objectives of the Organization. These net assets may be used at the discretion of Management and the Board of Directors.
Net assets with donor restrictions: Net assets subject to stipulations imposed by donors and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Organization or by the passage of time.
Other donor restrictions are perpetual in nature, whereby the donor has stipulated the funds be maintained in perpetuity.
7 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Measure of Operations: The statement of activities reports all changes in net assets, including changes in net assets from operating and non-operating activities. Operating activities consist of those items attributable to the Organization’s ongoing activities.
Non-operating activities are limited to resources that generate return from investments and other activities considered to be of a more unusual or nonrecurring nature.
Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures contained in the financial statements. Actual results could differ from those estimates.
Cash and Cash Equivalents: For purposes of the statement of cash flows, the Organization considers investments available for current use with an initial maturity of three months or less to be cash equivalents.
Concentrations of Credit Risk: Financial instruments that potentially subject the Organization to concentration of credit risk are cash and receivables. Concentration of credit risk with respect to receivables is limited because a substantial portion of these balances are due from federal and state governmental agencies. Management believes the Organization is not exposed to any significant credit risk on cash. The Organization maintains its cash in various bank accounts that, at times, may exceed federally insured limits. These accounts have been placed with high credit quality financial institutions.
On June 30, 2022, the Organization did not have cash in excess of the FDIC insured limit.
Receivables: Receivables are stated at the amount management expects to collect from balances outstanding at year end. The receivables are primarily contracts and/or grants from funding sources for services performed under cost reimbursement contracts. It is the practice of the Organization to record an allowance for doubtful accounts. Bad debts are charged to the allowance account as incurred. Based on management’s assessment of receivables it has concluded that an allowance is not necessary on June 30, 2022. Balances that are still outstanding after management has used reasonable collection efforts are written off to bad debt expense.
Revenue and Revenue Recognition: Revenue is recognized when earned. Program service fees and payments received in advance are deferred to the applicable period in which the related services are performed, or expenditures are incurred, respectively.
Contract Revenue: Revenue under some third-party payor agreements is subject to audit and retroactive adjustments. Provisions for estimated third-party payor settlements are provided in the period the related services are rendered, if determinable. 8 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Contributions: Contributions are recorded as income at the estimated value at date of receipt as net assets without donor restrictions or net assets with donor restrictions, depending on the existence and/or nature of any donor-imposed restrictions. No donations with donor-imposed restrictions have been received.
Conditional Promises to Give: Conditional promises to give, that is, those with a measurable performance or other barrier, and a right of return, are not recognized until the conditions on which they depend have been substantially met. Conditional gifts received prior to the satisfaction of conditions are recorded as refundable advances.
Donated Services and In-Kind Contributions: Volunteers contribute significant amounts of time to our program services, administration, and fundraising and development activities; however, the financial statements do not reflect the value of these contributed services because they do not meet recognition criteria prescribed by generally accepted accounting principles. Donated goods are recorded at fair value at the date of donation.
Donated services are recorded at the respective fair values of the services received. No significant contributions of such goods or services were received during the year ended June 30, 2022.
Due to/from related parties: Amounts as due to/from related parties, included in the accompanying statements of financial position, arise principally from the collaborative activities between the affiliates to further the mission of the Organization.
Property and Equipment: The Organization capitalizes property and equipment over $5,000. Lesser amounts are expensed. Purchased property and equipment is capitalized at cost. Donations of property and equipment are recorded as contributions at their estimated fair value. Such donations are reported as unrestricted contributions unless the donor has restricted the donated assets to a specific purpose. The cost of maintenance and repairs is charged to expense as incurred, significant renewals and betterments are capitalized. Property and equipment are depreciated using the straightline method over the estimated useful lives of the assets.
Compensated Absences: The Organization’s policy allows employees to accumulate vacation and sick leave based on the length of service, position, and other factors.
Accrual of vacation time is included in the accompanying financial statements. The total amount accrued for vacation on June 30, 2022 was $746,300.
Income Taxes: The Organization qualifies as a not-for-profit organization as described in Section 501 (c)(3) of the Internal Revenue Code and is tax exempt from federal and state income taxes, therefore no provisions for income taxes have been made.
Management is of the opinion that there is no unrelated business income subject to taxation. Management is also of the opinion that there are no material uncertain tax positions. All tax returns have been appropriately filed by the Organization. 9 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Functional Expenses: The financial statements report certain categories of expenses that are attributable to more than one program or supporting function. Therefore, these expenses require allocation on a reasonable basis that is consistently applied. The costs of providing the various programs and supporting services have been summarized on a functional basis in the statement of activities. The statement of functional expenses presents the natural classification detail of expenses by function. Such expenses are charged to grant programs and supporting services on the basis of program costs.
General and administrative costs include those expenses that are not directly identifiable with any specific program but provide for the overall support of the Organization. Accordingly, certain costs have been allocated among program services and supporting services benefited. Such allocations are determined by management on an equitable basis.
Salaries and benefits are charged directly to the program for which work has been done based on time and effort. Other expenses and overhead costs are based on staff allocation to functional areas.
NOTE 3 – CASH AND CASH EQUIVALENTS:
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the amounts shown in the statement of cash flows:
Cash and Cash Equivalents $ 7,711
Cash Restricted for Client Funds 162,218
Total Cash, Cash Equivalents, and Restricted Cash
shown in the Statement of Cash Flows $ 169,929
NOTE 4 – RESTRICTIONS ON ASSETS:
Restrictions, if any, on assets as of June 30, 2022, are related to grant awards and/or lending agreements. Such assets must be used in accordance with the purposes established by laws and regulations of the grants or agreements in contrast with unrestricted funds over which the governing board remained full control to use in achieving any of its organizational purposes.
Separate cash accounts are maintained as required by grant and/or lending agreements. The Organization also holds cash in trust for participants in various programs.
10 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 5– LIQUIDITY AND AVAILABILITY OF FINANCIAL ASSETS:
The following reflects the Organization’s financial assets available within one year of the statement of financial position date. There are no amounts reduced and not available for general use because of donor-imposed restrictions or long-term investments.
Cash and cash equivalents $ 7,711
Grant contracts receivable 10,509,418
Total available for general expenditures $10,517,129
As part of the Organization’s liquidity management, it utilizes a zero-balance account (zba) with WestCare Foundation, Inc., a checking account in which a balance of zero is maintained by automatically transferring funds from a master account in an amount only large enough to cover checks presented. This cash pooling system is designed to leave in the current accounts of the subsidiaries the minimum amounts to be able to deal with their debts contracted. The advantage of this system is to centralize the cash to be able to obtain better rates. In addition, the Organization transfers amounts as needed to meet cash flow needs through a related affiliate, WestCare Foundation, Inc.
NOTE 6 – PROPERTY AND EQUIPMENT, NET:
Property and equipment, net consisted of the following on June 30, 2022:
Land $ 391,095
Buildings and Improvements 5,979,190
Leasehold Improvements 1,261,595
Furniture and Fixtures 382,613
Computer Equipment 122,759
Vehicles 649,894
8,787,146
Less: Accumulated Depreciation (4,480,652)
Total Property and Equipment, Net $4,306,494
For the year ended June 30, 2022, depreciation expense totaled $330,247.
NOTE 7 – EMPLOYEE BENEFIT PLAN:
The Organization has a 401(k)-retirement plan covering eligible employees held with Voya Financial with a Safe Harbor Match. The Organization’s match is 3% of each qualified employee’s basic contribution plus an additional $.50 for each $1 contributed for the next 2% earnings. Plan contribution by the Organization for the year ended June 30, 2022 was $205,717.
11 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 8 – COMMITMENTS AND CONTINGENCIES:
Operating Leases:
As of June 30, 2022, the Organization had entered into various non-cancellable operating lease agreements for real property. The approximate minimum future commitments on an annual basis are as follows: 2023 $582,104, 2024 $442,059, 2025 $343,508, 2026 $114,828 and thereafter $-0-.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to recognize leases on the statement of financial position for most leases with a term longer than 12 months. The effective date for this standard has been delayed to reporting periods beginning after December 15, 2021.
Contingencies:
Federal Grants – The Organization receives financial assistance from the federal government in the form of grants and entitlements. Receipt of grants is generally conditioned upon compliance with terms and conditions of the grant agreements and applicable federal laws and regulations, including the expenditure of resources for eligible purposes. Accordingly, expenditures financed by these programs are subject to financial and compliance audits by the grantor agencies, which could result in request for reimbursement by the grantor agencies for expenditures, if disallowed by the granting agencies, cannot be determined at this time. Management believes that such disallowances, if any, will not have a material adverse effect on the financial position of the Organization.
NOTE 9 – DEFERRED REVENUE:
Deferred revenue consists of the following amounts as of June 30, 2022:
Donation from Bezos Day one Families for Homeless $2,234,593 Contra Costa – COVID Rate 669,622
Other 388,037
$3,292,252
NOTE 10 – ECONOMIC DEPENDENCY:
The Organization receives a significant portion of its support and revenues from contracts and/or agreements with agencies of the Government of the United States. The Organization’s ability to continue operating is predicated on the government’s continued support and funding of its programs. The continuation of program services in the subsequent year is expected based on contract renewals and continuations received to date. A significant reduction in the level of this funding, if this were to occur, could have an adverse effect on the programs and activities.
12 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 11 – RELATED PARTY TRANSACTION:
WestCare Foundation, Inc. is a managing and governing oversight organization for WestCare California, Inc. During the year ending June 30, 2022, WestCare Foundation, Inc. received management fees for general and administrative expenses of $4,494,304 from WestCare California, Inc.
In addition, WestCare California, Inc. has advanced funds as of June 30, 2022 to WestCare Foundation, Inc. for $4,635,992.
NOTE 12 – COVID-19 PANDEMIC:
The COVID-19 pandemic, whose effects first became known in January 2020, is still having a broad and negative impact on commerce and financial markets around the world. The United States and global markets experienced significant declines in value resulting from uncertainty caused by the pandemic. The Organization continues to closely monitor its liquidity and impact of potential declines in operations. Accordingly, the extent to which COVID-19 may impact the Organization’s financial position and changes in net assets and cash flows remains uncertain and the accompanying financial statements include no adjustments relating to the effects of this pandemic.
NOTE 13 – SUBSEQUENT EVENTS:
The Organization has evaluated subsequent events through January 3, 2023, the date which the financial statements were available to be issued and has determined that there were no events occurring during that period that required disclosure to the accompanying financial statements.
END OF NOTES TO THE FINANCIAL STATEMENTS
13 WESTCARE CALIFORNIA, INC.
SUPPLEMENTAL MATERIAL
Pass through Federal Federal Transfers to
Identifying # CFDA# Expenditures Subrecipients
US Department of Housing & Urban Development
Emergency Solutions Grant Program
Pass Through Award(s):
Fresno County - ESG MAP (CA) A-18-338 14.231 149,753 -
Fresno County - Diversion (CA) A-19-259 14.231 342,694 - Fresno County-ESG-CV 2019-096 14.231 114,415
City of Fresno - ESG Project Unite (CA) 2021-101 14.231 154,891 Total Emergency Solutions Grant Program 761,753 -
Housing Opportunities for Persons with AIDS (HOPWA)
Pass Through Award(s):
City of Fresno (CA) 2020-237 14.241 677,765 61,112
Housing Opportunities for Persons with AIDS (HOPWA) 677,765 61,112 Continuum of Care Program
Direct Award(s):
Continuum of Care Program (CA)-Project LiftOff 14.267 306,458 3,695 Continuum of Care Program (CA)-Coordinated Entry 14.267 404,100 - Total Continuum of Care Program 710,558 3,695
Department of Veterans Affairs
VA Homeless Providers Grant and Perdiem Program
Direct Award(s):
VA Capital Grant & Per Diem (CA) 64.024 688,477
Veterans Grant Program-Case Management 64.024 75,081 -
Total VA Homeless Providers Grant and Perdiem Program 763,558 - VA Supportive Services for Veteran Families Program
Direct Award(s):
5,740,187 -
499,504 -
VA Supportive Services for Veterans Families (CA) - FY 21 64.033 VA Supportive Services for Veterans Families (CA) - COVID 19 - CARES 64.033 VA Supportive Services for Veterans Families (CA) - Shallow Subsidy Serv 64.033 226,263 Total VA Supportive Services for Veteran Families Program 6,465,954 - US Department of Health & Human Services:
Substance Abuse and Mental Health Services Projects of Regional and National Significance Direct Award(s):
SAMHSA BEAT HIV/AIDS (CA) 93.243 543,341 -
SAMHSA Opening Doors to Housing and Wellness 93.243 298,721 - SAMHSA MAT PDOA 93.243 208,818 10,975
SAMHSA Youth and Family Tree 93.243 242,950 -
SAMHSA Fresno City College 93.243 241,583 -
Total Substance Abuse and Mental Health Services Projects 1,535,413 10,975 Block Grants for the Prevention and Treatment of Substance Abuse Pass Through Award(s):
US Probation & PreTrial (CA) 0972-2016-19 93.959 124,150 Sierra Health Foundation SOS MLK 0972-21-14SR 93.959 35,362 Siera Health Foundation- Telehealth Bakersfield 93.959 11,381 Siera Health Foundation- Telehealth Belmont 93.959 12,573 Siera Health Foundation- Telehealth Hanford 93.959 10,664 Sierra Health Foundation SOS 93.959 8,521
Sierra Health Foundation Richmond 93.959 1,810
Total Block Grants for the prevention and Treatment of Substance Abuse 204,461 - Total Expenditures of Federal Awards $ 11,119,462 $ 75,782 WESTCARE CALIFORNIA, INC.
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
14 The accompanying notes are an integral part of this schedule.
WESTCARE CALIFORNIA, INC.
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
NOTE A - BASIS OF PRESENTATION:
The accompanying schedule of expenditures of federal awards include the federal award activity of WestCare California, Inc. under programs of the federal government for the year ended June 30, 2022. The information in the schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of WestCare California, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of WestCare California, Inc.
NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Expenditures reported on the Schedule are reported on the accrual basis of accounting.
Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
NOTE C – INDIRECT COST RATE:
WestCare California, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. WestCare California, Inc. has a provisional indirect rate agreement for 26% for the year ended June 30, 2022. 15 WESTCARE CALIFORNIA, INC.
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FEDERAL PROGRAMS
FOR THE YEAR ENDED JUNE 30, 2022
Section I – Summary of Auditor’s Results
Financial Statements
Type of auditor’s report issued on whether the financial statements audited were prepared in accordance with GAAP: Unmodified Internal control over financial reporting:
• Material weakness(es) idenitifed? No
• Significant deficiency(ies) identified? None reported Noncompliance material to financial statements noted? No Federal Awards
Internal control over major programs:
• Material weakness(es) identified? No
• Significant deficiency(ies) identified? None reported Types of auditor’s report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with CFR 200.516(a)? No
Identification of major programs:
Federal Program or Cluster Federal CFDA No.
VA Homeless Providers Grant 64.024
Substance Abuse and Mental Health Services 93.243
Block Grants for Prevention & Treatment Substance Abuse 93.959 Dollar threshold used to distinguish between type A & type B Programs:
Federal Programs: $750,000
Auditee qualified as low-risk auditee pursuant to Uniform Guidance: Yes
Section II – Financial Statement Findings
None reported
Section III – Federal Award Findings and Questioned Costs None reported
Section IV – Other Issues/Prior Year Audit Findings
No management letter is required because there were no findings required to be reported in the management letter.
No Summary Schedule of Prior Audit Findings is required because there were no prior audit findings.
No Corrective Action Plan is required because there were no findings required to be reported. 16 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether WestCare California, Inc.’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the organization’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the organization’s internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Fresno, California
January 3, 2023
18 conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about WestCare California, Inc.’s compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding WestCare California, Inc.’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.
• Obtain an understanding of WestCare California, Inc.’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of WestCare California, Inc.’s internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with the type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be significant deficiencies or material weaknesses in internal control. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Fresno, California
January 3, 2023
20 February 13, 2024
City of Fresno
Planning and Development Department
Community Development Division (HCDD)
2600 Fresno Street
Fresno, CA 93721
RE: Letter of Support for WestCare California, Inc.
Dear Grant Review Committee,
Fresno Housing is pleased to support WestCare California’s application for Emergency Solutions Grant (ESG) funding to provide rapid rehousing and homelessness prevention services in the City of Fresno. WestCare California is an important partner, and its work to support and house people experiencing homelessness continues to be greatly needed and highly valued.
Through many collaborations, WestCare California and its partners serve hundreds of people experiencing homelessness in Fresno City each year, including the chronically homeless, Veterans, and families. WestCare California is instrumental in providing housing and other supportive programs for these most vulnerable members of our community.
WestCare California is an important leader in enabling Fresno City to reach its goals to end homelessness and prevent its return for individuals and families in need. We look forward to continuing our critical work with WestCare California and improving the quality of life for our entire community.
Respectfully,
Doreen Eley
Assistant Director, Resident Empowerment
City of Fresno
Planning and Development Department
Community Development Division (HCDD)
2600 Fresno Street
Fresno, CA 93721
Re: Letter of Support for WestCare California, Inc.
Dear Grant Review Committee:
RH Community Builders is pleased to support WestCare California’s application for Emergency Solutions Grant (ESG) funding to provide rapid rehousing and homelessness prevention services in the City of Fresno. WestCare California is an important partner, and its work to support and house people experiencing homelessness continues to be greatly needed and highly valued.
Through many collaborations, WestCare California and its partners serve hundreds of people experiencing homelessness in Fresno City each year, including the chronically homeless, Veterans, and families. WestCare California is instrumental in providing housing and other supportive programs for these most vulnerable members of our community.
WestCare California is an important leader in enabling Fresno City to reach its goals to end homelessness and prevent its return for individuals and families in need. We look forward to continuing our critical work with WestCare California and improving the quality of life for our entire community.
Respectfully,
Brad Hardie
President
RHCOMMUNITYBUILDERS.COM
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Application
HOPWA
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
PY 2024-2025 APPLICATION
Homeless Services and Homelessness Prevention Programs
1. Project Summary Information
Project Name (10 words or fewer): The Living Room
Amount Requested: $ 960,486.00
ESG Applicants Only – please provide a breakdown of amounts requested by program component:
Street Outreach: $ .00
Emergency Shelter: $ .00
Homelessness Prevention: $ .00
Rapid Rehousing: $ .00
HMIS: $ .00
HOPWA Applicants Only – please provide a breakdown of amounts requested by program component:
Rapid Rehousing: $ 86,214.00
Tenant-Based Rental Assistance (TBRA): $ 210,000.00
Short-Term Rent, Mortgage and Utility (STRMU): $ 78,492.00 Supportive Services: $ 417,685.00
Housing Information: $ 168,095.00
This is a:
New Project/Program
Existing Project/Program
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
Provide a short description of the proposed program/activity. (1 to 3 sentences and must fit in the provided space).
WestCare California, Inc. is the lead agency partnering with Fresno Housing to continue providing housing assistance and related support for people living with HIV and their families in Fresno County. Specific services include Rapid Rehousing, Tenant-Based Rental Assistance (TBRA), Short-Term Rent, Mortgage, and Utility (STRMU) assistance, Supportive Services, and Housing Information. The primary goals of the proposed program are to help participants achieve permanent housing and health stability.
2. Organizational Capacity
a. Describe the organization’s experience with administering Federally funded programs like the one described in this application.
WestCare California has provided behavioral health and human services in Fresno County since 1974. Today, WestCare's services fall into five primary domains: Mental Health & Wellness, Treatment & Rehabilitation, Veteran Services, Criminal Justice, Housing Opportunities, and HIV Education & Prevention. WestCare has extensive experience working with a variety of special populations, including people experiencing homelessness, people with substance use and mental health disorders, people living with HIV, criminal justice populations, Veterans, and the LGBTQ community.
WestCare has administered the short-term rental assistance, outreach, and case management components of HOPWA since 2007 and has systems in place for connecting with and helping the high-priority HOPWA subpopulations, including people experiencing unsheltered homelessness, people experiencing chronic homelessness, Veterans experiencing homelessness, and other highly vulnerable persons, such as victims of domestic violence, households with children, and youth aging out of the foster care system. Since 1996, WestCare has operated The Living Room, one of the only community centers for people living with HIV in the Central Valley.
With ongoing funding from multiple federal, state, and local agencies, including HUD, SAMHSA, Veterans Administration, California Department of Corrections and Rehabilitation, Board of State and Community Corrections, County of Fresno, City of Fresno, and others, WestCare administers 60 separate contracts throughout California with a budget of approximately $60 million and more than 400 staff. WestCare's leadership team has decades of PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
experience administering homelessness prevention and housing programs in Fresno.
WestCare currently operates several housing programs in Fresno County, including Housing Opportunities for People with AIDS (HOPWA) and Project Unite under contract with the City of Fresno; Project Liftoff and Coordinated Entry funded by HUD, and several other housing programs funded by various public and private agencies.
b. For how many years has the organization administered activities of the type described in this application?
17 c. Please describe the cultural competency training staff will be required to complete during the term of this program.
All WestCare staff must complete cultural competency training within 30 days of hire and annually thereafter. The “Diversity in the Workplace” training is designed to help participants recognize diversities and understand how they can create an accepting environment that celebrates each person’s diversity. After completing this course, staff will be prepared to: 1) List ways in which we’re diverse, 2) Describe the challenges and opportunities of having a diverse workplace, 3) Name ways to avoid discrimination in the workplace, 4) Recognize ways to embrace diversity, and 5) Identify interpersonal diversity skills.
d. Does the organization have the following in place (check box if ‘yes’)? Written policies and procedures for the proposed project or program (i.e., intake, eligibility)
Written Financial Management Policies and Procedures
Non-Discrimination / Equal Opportunity Policy
Conflict of Interest Policies and Procedures
Procurement Policies and Procedures
Facility utilization plan and policies
Note: If not, be aware, the City will require a facility utilization plan and policies prior to the execution of a subrecipient agreement.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
e. Provide addresses for each applicable location of site(s) where activity will occur, a brief description of the facilities, and a description of the service area (a map may be attached in lieu of a service area description).
The Living Room moved in December 2023 to 1850 N Gateway Blvd, Ste 100, Fresno, CA 93727-1626. The new facility has private offices for staff that can be used for counseling or testing. The facility also has a kitchen, drop-in center, bathrooms, and a reception area. The Living Room's office is located on multiple bus lines and is ADA-accessible. A map of the service area is attached in lieu of a service area description.
3. Proposed Scope of Work
a. Briefly describe the needs this proposal addresses, and how existing resources are insufficient to meet this need.
There is a great need in the City of Fresno for housing and supportive services for an increasing homeless population. The 2023 Point-in-Time (PIT) Count, which attempts to document all people experiencing homelessness in Fresno and Madera Counties, showed that a total of 4,493 people were experiencing homelessness in Fresno and Madera Counties on the night of the survey. This includes 2,758 (61%) people who were experiencing unsheltered homelessness, 1,431 (32%) people who were staying in emergency shelters, and 304 (7%) people who were living in transitional housing.
These figures represent an overall 7% increase in homelessness in the FresnoMadera area since the last PIT Count was conducted in 2022. 34 (1%) people identified through the PIT Count had an HIV/AIDS-related illness. However, this is likely a significant underrepresentation considering that The Living Room serves hundreds of people living with HIV experiencing homelessness every year in Fresno.
The most recent HIV Surveillance Report published by the California Department of Public Health, Office of AIDS, shows that in 2021 there were 2,246 persons living with diagnosed HIV infection in Fresno County. From 2015 to 2022, 745 new HIV cases were identified among Fresno County residents. Over this same period, HIV incidence rates were approximately five times higher for men than for women. Of those cases where the transmission route was known, most new HIV infections occurred among men who have sex with men (MSM) (85.7%). Other reported transmission routes included heterosexual contact only (4.4%), MSM and intravenous drug use (IDU) (3.2%), IDU only (2.8%), heterosexual contact and IDU (2.2%), and heterosexual and MSM contact (1.4%). In 24% of new HIV cases in Fresno County, there were no risk factors identified as likely transmission routes.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
In 2022, the majority (65%) of newly diagnosed HIV cases in Fresno County occurred among Hispanic/Latinx individuals. Although these individuals made up the majority of new HIV cases, prevalence rates were nearly three times higher among Fresno’s Black population, revealing a significant health disparity for this group. Moreover, HIV incidence rates in Fresno County have dramatically increased among people under 30 years old over the last several years. Roughly 42% of Fresno’s new HIV cases were diagnosed in people from this age group in 2022. This data indicates that the individuals who are currently at the highest risk for contracting HIV in Fresno County are Black and Hispanic/Latinx MSM under 30 years of age.
Currently, available resources are not enough to meet the needs of low-income people living with HIV in this community. Many more HOPWA-eligible people need these services than the program can currently serve with its existing resources. Last year, 14 households were on the wait list for TBRA and 15 were on the wait list for ST-TFBH. More resources are urgently needed to help close this gap in services. b. Briefly describe the target population, how they will be assessed, and how the project will meet the specific needs of the target population.
Target Population. The priority populations for the Living Room include those individuals who are currently at the highest risk for contracting HIV in Fresno County, namely Black and Hispanic/Latinx MSM under 30 years of age. The Living Room’s participants are representative of Fresno County’s most high-risk populations, including people who inject drugs, people experiencing unsheltered and chronic homelessness, MSM, young MSM (YMSM), sex industry workers, people with criminal records, and people with SUD, mental health disorders, and co-occurring disorders (COD). Although housing is the most immediate need for most of The Living Room’s participants, most clients also have significant needs in other areas as well, including linkage to appropriate medical care, SUD and mental health treatment, food, clothing, adult basic education, employment, and assistance securing public benefits, which they often are not aware that they are eligible for.
Assessment. Upon enrollment to the program, the program team will collaborate with the client to comprehensively assess their strengths, needs, and preferences. Clients will complete a VI-SPDAT housing assessment along with a comprehensive biopsychosocial assessment, which covers all life areas needed to achieve wellness, not just for housing but also for life areas that will support future housing stability, including SUD treatment, mental health therapy, medical care, financial, educational, vocational, legal, social, and recreation/leisure needs. The assessment results will form the basis for creating the client’s individualized housing and services plan.
Meeting Client Needs. Based on the assessment results, the Lead Case Manager and Client Service Navigator will collaborate with clients to develop an individualized housing and services plan that outlines the specific housing assistance and PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
supportive services they will participate in to achieve their identified goals. Once the goals for the plan are established, the caseworker will assist the client in obtaining all services identified in their plan, including housing assistance, medical care, and any supportive services they may need to achieve housing stability. The caseworker will provide a warm handoff to all service linkages rather than a mere referral to ensure the client receives all services identified in their plan. Program staff will also assist the client with making appointments while following up with community service providers to ensure that the client attends their scheduled appointments. If the client is experiencing barriers to accessing services, program staff will help address those barriers, including providing transportation to service providers’ offices. Initially, clients will meet with their assigned caseworker on at least a weekly basis, or more often as necessary, to monitor progress on their plan and make updates as needed.
Once a client’s living situation becomes more stable, meetings may taper off to once every other week.
c. Describe how the project was developed in consultation with the target population.
At WestCare, we believe that getting participant feedback is the best way to improve the effectiveness and efficiency of our programs. To this end, program staff regularly gather small groups of clients in an informal setting to discuss the services they’re most interested in receiving and how they can best be delivered to meet their needs.
These informal conversations aim to gather candid feedback on services from the client’s perspective and determine their satisfaction with the services they received.
This feedback is critical to WestCare’s program design process because it can help the program team identify any shortcomings the program may have, discover any unmet needs that participants may have, and determine areas for improvement. d. Describe how the project will be marketed to the target population.
The Living Room has a well-established presence in Fresno County, having conducted outreach and engagement activities here since its founding in 1996. Outreach conducted for the proposed program will focus on the priority population of Black and Hispanic/Latinx MSM under 30 years of age, who have the highest prevalence and incidence rates, respectively, for HIV in Fresno County. To reach this priority population, The Living Room will apply a multi-pronged approach for outreach encompassing the strategies listed below.
Leverage relationships with other CBOs serving the priority population. As a long-term HIV housing and service provider in Fresno County, The Living PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
Room has extensive relationships with local LGBTQ+ centers, housing agencies, and health clinics serving the priority population. Although The Living Room receives referrals from (and provides linkages to) many agencies, our primary referral partners include HIV clinics (CRMC, Kaiser Permanente, Clinica Sierra Vista, and United Health Centers), housing providers (through the FMCoC’s Coordinated Entry System), SUD treatment programs (WestCare, Touchstone Recovery Center), and LGBTQ+ agencies (Spectrum Center, Trans-E-Motion, and Fresno EOC’s LGBTQ+ Resource Center).
Host a safe drop-in space. The Living Room was founded in 1996 as "a place to belong," giving people living with HIV/AIDS a safe, secure environment to access needed services to improve their physical, mental, and emotional wellbeing. Today, The Living Room continues to offer a safe drop-in space where HIV+ individuals can feel comfortable discussing sexual health, accessing information about available resources, and participating in welcoming support groups.
Attend and host local LGBTQ+ events. The Living Room is a regular presence at Fresno’s LGBTQ events, including the annual Pride Parade, Reel Pride Film Festival, Fresno Rainbow Pride Pageant, and Imperial Dove Court. At many of these events, The Living Room will host a table providing free HIV testing and informational brochures with HIV resources. The Living Room also hosts regular Drag Queen Bingo Nights at local bars and clubs.
Attend and host HIV-specific events. Two of the biggest HIV-specific events in Fresno each year are World AIDS Day and the annual Fresno AIDS Walk and 5K Run. Each event aims to create community, fight stigma, and provide a safe space to remember the lives of those who have been lost to the virus.
The Living Room is the lead organizer of the Fresno AIDS Walk and has hosted this event every year since 2012. This highly anticipated event brings out hundreds of residents to support the cause each year.
Social media. The Living Room is active across several social media channels, including separate Facebook pages for The Living Room and the Fresno AIDS Walk. WestCare’s Facebook, Twitter/X, and Instagram channels also provide information on the services available to HOPWA-eligible individuals. At least 10 monthly posts per social media account promote HOPWA services and HIV testing events.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
e. Summary of services to be provided:
Select all services to be provided, including those that are not funded by the City.
Emergency Shelter
Transitional Housing
Homeless Prevention/Housing Assistance
Homeless Diversion
Mental Health/Other Services
- Individual and Family Counseling
- Drug/Alcohol Treatment
- Job Training
- Children’s Program
- Parenting education
- Domestic Violence Intervention
- Self-Sufficiency Skills Training
- Outreach
- Assessment of Needs
Permanent Housing with Supportive Services
Affordable Housing
Job Training/ Job Search
Women’s Program
Day Care
Youth Program
Access to Medical
Immigration Assistance
Fair Housing Assistance
Academic Support/Tutoring
Referral Services
Case Management
Provide Meals
Free Services
Business Development to micro-enterprise
Other (specify):If WestCare does not provide a needed service directly, the program will provide a warm handoff to other service providers in the community who do.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
f. Estimate the number of unduplicated persons expected to benefit from the project:
175 unduplicated persons will receive a direct benefit from this project. g. Please indicate which of these service types will be provided and the number of unduplicated persons who will benefit.
Check if
Providing Public and Community Service Types Estimated No. Persons Assisted Operating Cost of Shelters for Persons
who are homeless or impacted by
HIV/AIDS
Rental Assistance/Subsidy 130
Supportive/Essential Services (not
duplicated with services provided in
conjunction with another activity)
150
Housing information services (not
duplicated with services provided in
conjunction with another activity)
150
h. Describe the homeless service or homelessness prevention program. Please include information about barriers to program participation and how the activity will address those barriers, and any information about how the activity was developed or refined in consultation with the target population. Limit description to the space provided on this and the next page.
Alignment with the Consolidated Plan. WestCare's proposed activities are consistent with the priorities outlined in the City of Fresno 2020-2024 Consolidated Plan. The specific priority addressed under this application is for "Homelessness and the Prevention of Homelessness" to "provide assistance for the homeless and those at risk of becoming homeless through safe lowbarrier shelter options, housing first collaborations, and associated supportive services." WestCare's proposed services are consistent with the plan’s priorities regarding homelessness, will help participants regain housing stability, and are grounded in the Housing First approach.
WestCare and its partners provide all aspects of homeless housing and homelessness prevention, including emergency shelter, transitional housing, housing relocation, rental assistance, housing stabilization, linkages to medical care, access to substance use disorder treatment services, and case PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
management. The Consolidated Plan's HOPWA-specific goals continue to prioritize short-term rent, mortgage, and utility assistance (STRMU), tenantbased rental assistance (TBRA), and transitional housing. WestCare and FHA currently provide these services, including outreach, case management, and supportive services. All clients assessed for housing are entered into a database for consideration for Section 8 vouchers.
The Program. The Living Room's operations plan reflects a client-driven, holistic, and culturally affirming approach to promoting long-term housing stability and well-being for low-income people living with HIV. The program is centered around a Housing First approach, ensuring accessible and equitable housing assistance for HOPWA-eligible clients without mandatory participation in treatment services. The program’s outreach strategies will focus on a priority population of Black and Hispanic/Latinx MSM under 30. To reach this audience, specific outreach strategies will include leveraging community partnerships, hosting safe drop-in spaces, attending and hosting LGBTQ+ and HIV-specific events, and utilizing social media. At intake, the program’s Case Manager will verify eligibility for services based on a positive HIV diagnosis, proof of homelessness, and documented low-income status. Each client will complete a comprehensive assessment and collaborate with their Case Manager to develop an individualized housing plan incorporating supportive services to address underlying issues contributing to housing instability.
Clients will receive various housing assistance services based on their unique needs and preferences, including Rapid Rehousing, Tenant-Based Rental Assistance (TBRA), Short-Term Rent, Mortgage, and Utility (STRMU) assistance, Supportive Services, and Housing Information. Once clients have established stable housing and demonstrate the ability to maintain it successfully, they will be eligible for discharge. The Case Manager will provide six months of post-discharge follow-ups to ensure the client’s sustained stability, and cases will be closed after clients demonstrate six months of ongoing stability.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
Detailed Narrative Description of Project/Program (Continued from previous page) Partnership with Fresno Housing. The Living Room has a longstanding collaboration with Fresno’s public housing agency, Fresno Housing, to administer TBRA for low-income people living with HIV and their families in Fresno County. Under this agreement, WestCare will continue to provide Fresno Housing with a subcontract for its services, which include 1) Conducting a Housing Quality Standard inspection and verifying rent reasonableness for each prospective leased unit; 2) Completing income eligibility and rent calculation to determine each participant’s rent responsibility; 3) Ensuring timely rental assistance payments are made to property owners/landlords; 4) Conducting annual re-certifications, interims, and transfers using HACF-approved tracking software; 5) Assisting WestCare staff in providing support as needed for housing retention; and 6) Making rent payments on behalf of program participants and billing these payments to WestCare.
Addressing Barriers. People experiencing homelessness face formidable barriers, including lack of reliable transportation, need for childcare, lack of steady work history and/or inadequate preparation for employment, little or no income, food scarcity, and the inability to navigate complex systems. WestCare mitigates these factors through comprehensive services, including providing transportation to appointments, linking participants to medical and mental health providers, substance use disorder treatment, vocational and educational services, assistance enrolling in public benefits, and providing hot meals and an emergency food pantry.
Consultation with the Target Population. At WestCare, we believe that getting participant feedback is the best way to improve the effectiveness and efficiency of our programs. To this end, program staff regularly gather small groups of clients in an informal setting to discuss the services they’re most interested in receiving and how they can best be delivered to meet their needs. These informal conversations aim to gather candid feedback on services from the client’s perspective and determine their satisfaction with the services they received. This feedback is critical to WestCare’s program design process because it can help the program team identify any shortcomings the program may have, discover any unmet needs that participants may have, and determine areas for improvement.
Meaningful Impact. For the current program year (April 1, 2023 – March 30, 2024), The Living Room is on track to exceed many of its performance targets: 21 households received TBRA, 79 households received STRMU, 23 households received Short-Term Transitional Facility-Based Housing (ST-TFBH), 675 food boxes were provided, and 1,390 hot meals were provided. When low-income people living with HIV have access to stable housing and nutritious food, this stability contributes to better health outcomes. It helps clients reach a point where their viral loads become undetectable and untransmittable. Ultimately, these efforts reduce the risk of spreading HIV, improving overall community health.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
i. Collaboration
Briefly describe any collaboration efforts with other organizations for this project/program or related initiatives.
Collaborating Organization Description of Collaboration Fresno Housing TBRA administration
Community Special Services
clinic at Community Regional
Medical Center
HIV treatment
Kaiser Permanente HIV treatment
Clinica Sierra Vista HIV treatment
Trans-E-Motion Support groups, community education
Spectrum Center LGBTQ programming, social and community events Avita Pharmacy PrEP
4. Project/Program Budget
a. Activity Budget by Funding Type
Please provide a high-level summary of the total budget by federal and nonfederal funds.
Proposed Activity Budget Amount
Total ESG, HOPWA, and/or CDBG Funds Requested $1,300,075 Total Other Federal Funds (do not include the above funds on this line)
$0
Total Non-Federal Funds $339,589
Total Proposed Activity Budget $1,639,664
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
b. List of Funding Sources
Provide all planned funding anticipated/ committed for this activity for FY 2024- 2025. If the organization has received funding commitment letters, please attach as an exhibit to this application.
Funding Source (Name of
Funder)
Name of
Funding
Program (if
applicable)
Dollar Amount
Commitment
Status
(Committed
or Pending)
If Pending,
Expected
Commitment
Date
Broadway Cares/Equity
Fights AIDS
National Grants
Program –
Direct Services
$7,500 Committed N/A
c. Activity Budget Summary and Narrative
Please complete Exhibit A – Operating Budget Summary.
The above referenced Budget worksheet is available in Excel format at www.fresno.gov/housing under ‘Notices of Funding Available.’ Please complete Exhibit B – Budget Narrative to provide a brief explanation of the expenses included in the budget.
d. Prior-Year Financial Statement
For existing programs, please attach a financial statement labeled as Exhibit D for the proposed program for the last full operating year. Failure to provide the financial statement will result in disqualification.
PY24-25 Consolidated NOFA Part B
Application – Homeless and Homelessness Prevention
Attachments to Part B Application:
EXHIBIT A – Operating Budget Summary
EXHIBIT B – Budget Narrative
EXHIBIT C – Homeless Service and Homelessness Prevention ESG Sources and Amounts of Match and Match Questionnaire (ESG-Only)
EXHIBIT D – Prior-year audited financial statement including statement of activities, statement of financial position and statement of cash flows (required when total Federal grant awards equaled or exceeded $750,000 during the annual audit period); or prior-year unaudited financial statement when total Federal grant awards for the annual audit period was less than $750,000
Optional Additional Exhibits:
EXHIBIT E – Funding Commitment Letters (if available)
EXHIBIT F – Letters of Support (optional – maximum 2)
EXHIBIT G – Service Area Map (required if not described in 2.e.) Salaries & Wages Fringe Benefits
Totals
(City of Fresno HUD
Funds)
Other Federal
Funds State Funds Local Govm'tFunds
Private / Donor
Funds
Other Funds
(specify)
Salaries/Wages (Specify each position; add additional rows as needed) Direct Service Personnel:
Program Director 63,000.00 14,238.00 77,238.00 77,238.00 Lead Case Manager 54,600.00 12,339.60 66,939.60 66,939.60 Outreach Specialist 50,232.00 11,352.43 61,584.43 61,584.43 Kitchen Assistant 24,960.00 5,640.96 30,600.96 30,600.96 Client Services Navigator 45,864.00 10,365.26 56,229.26 56,229.26 Administrative Personnel:
Administrative Assistance 43,680.00 9,871.68 53,551.68 53,551.68 ‐ ‐
‐ ‐
Independent Contractors / Consultants: $ 53,551.68 TBRA ‐ Fresno Housing
Authority 204,000.00 204,000.00 204,000.00 ‐ ‐
TOTAL PERSONNEL BUDGET $ 282,336.00 $ 63,807.94 $ 346,143.94 $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 346,143.94 Occupancy, Supplies, and Other Operating
Office Rent $ 12,000.00 12,000.00 12,000.00 Utilities 6,000.00 6,000.00 6,000.00 Telecommunications 8,250.00 8,250.00 8,250.00 Office Supplies 5,228.00 5,228.00 5,228.00 Client Personal Needs 11,570.00 11,570.00 11,570.00 Client Travel 6,000.00 6,000.00 6,000.00 Repairs/Maintenance 5,000.00 5,000.00 5,000.00 Travel 7,250.00 7,250.00 7,250.00 Training 2,800.00 2,800.00 2,800.00 Vehicle Lease/Insurance 25,200.00 25,200.00 25,200.00 HMIS Licensing 660.00 660.00 660.00 Employee Recruitment 1,500.00 1,500.00 1,500.00 Other (Specify) ‐
TOTAL OCCUPANCY, SUPPLIES
AND OTHER OPERATING
BUDGET
$ 91,458.00 $ 91,458.00 $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 91,458.00 INDIRECT COSTS (Select 1 indirect rate Only)
Approved Cost Allocation Plan
Rate 24% 151,255.18 151,255.18 151,255.18 De minimus 10 % Rate ‐ TOTAL INDIRECT COST BUDGET 151,255.18 $ 151,255.18 $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 151,255.18 Program Expense Budget
Permanent Housing Placement 15,000.00 15,000.00 15,000.00 Emergency Shelter (Hotel) 15,000.00 15,000.00 15,000.00 Grant Assistance to
Beneficiaries ‐ SUD treatmentg
(5 persons / 30 days /
$110/day)
9,900.00 9,900.00 9,900.00 Grant Assistance to
Beneficiaries ‐ Sober Living (10
persons / 33 days / $33/day)
9,900.00 9,900.00 9,900.00 Bridge Housing (4 units ‐ #208,
#213, new unit Dakota Ln) @
$995/unit/month + deposit
54,528.00 54,528.00 54,528.00 Short‐Term Rent, Mortgage,
Utilities (STRMU) 63,300.00 63,300.00 63,300.00 Loans to Beneficiaries ‐ ‐ Other (Specify) ‐ ‐
TOTAL PROGRAM EXPENSE
BUDGET 167,628.00 $ 167,628.00 $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 167,628.00 TOTAL PROJECT BUDGET $ 896,677.18 $ 63,807.94 $ 960,485.12 $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 960,485.11
CITY OF FRESNO
OPERATING BUDGET SUMMARY (non‐capital projects)
Budgeted Position (Personnel)
or Category (Operations)
City of Fresno HUD Funds Other Funds for Project
Project Totals (All
Funds)
WestCare California
Program Director The Program Director will be responsible for oversight of the program and scope of work. This position will approve all purchases to ensure costs are within budget, monitor data for contract compliance, submit performance reports, and will provide supervision through direct observation and follow‐up training.
Lead Case Manager Person in this position will be responsible for providing programmatic leadership and oversight of a caseload for the program. Responsible for the coordination of client care by collaborating with multidisciplinary healthcare professionals and other community‐ based programs as needed to provide and facilitate services toward housing stability and client self‐efficacy. Lead Case Manager will meet with each client twice monthly, or as needed to provide support and assistance towards achieving each Individualized Housing Plan. This full time position will be paid at $26.25/hour.
Outreach Specialist/Case Manager This staff member will be responsible for a caseload of PLWA, and coordinating and facilitating outreach efforts in the greter Fresno community; prioritizing efforts in the rural communities that are greatly underserved. The Case Manager will meet with each client at least once weekly to provide support and assistance towards achieving each Individualized Service Plan. This 1.0 FTE will be paid at $24.15/hour.
Kitchen Assistant The Kitchen Assistant will ensure meals are prepared on Tuesday, Wednesday and Thursday and are in accordance with safe food handling guidlines. They will also provide maintenance of the food patry and prepare and distrubute grocery bags to program participants. This part‐time position will work on‐site a total of 24 hours per week (0.6 FTE) and will be paid $20/hour.
Fringe Benefits Calculated at 22.6% of total salaries
Facility Lease/Rent This line item represents the cost of rented space to be used for the day‐to‐day operations of the program. Office space, reception area, restrooms, kitchen, food pantry, etc. Estimated costs are $1,000/month.
Utilities This line item represents the cost of electricity, natural gas, water/sewer, trash removal, alarm service, and other utility costs allocated per the rented space to be used by the program. Calculated at an estimated $500 per month x 12 months.
Repairs/Maintenance This line item represents the repairs/maintenance/remodel of office space for staff to be used for the program calculated at an estimated cost of $5,000 for the year or $416.67 per month for 12 months.
Supplies/Expendable Equipment This line item represents the cost of consumables such as paper, pens, clipboards, toner, staples, etc. for the program staff/facility in addition to the cost of copier/printer/scanner lease. Calculated at an estimated $291.67 per month x 12 months.
Auto Lease Line item represents the cost of one truck leased at $1,050/month for 12 months.
Staff Travel/Training/Fuel Costs/Vehicle
Maintenance
Cost of fuel for leased vehicles, mileage reimbursements for staff who use their personal vehicle for program related travel, and vehicle maintenance. Additionally, cost allocated for possible staff training during the PY. Calculated at an estimated $7,250 for the PY.
HMIS Licensing Cost of two staff to be HMIS licenced at $330 per license.
Communications For the monthly connectivity fees associated with the program cell phones to be used by HOPWA program staff, desk phone, fedex cost , internet/cable, etc. Calculated at $466.67 per month x 12 months.
Client Needs This line item represents the cost of consumables…... Calculated at an estimated $964.17 per month x 12 months.
Employee Recruitment This line item represents the recruiting of staff, Indeed, physical exams, lab work, etc. at $1,500/year.
Permanent Housing Placement (PHP) Funds to provide assistance to clients for a path to permanent housing for clients Estimated at $1,250 per month x 12 months.
WestCare California, Inc.
City of Fresno HOPWA
PY22‐23 CoF ‐ FY24‐25 WCCA
Supportive Services
Sober Living Funds to provide assistance to clients for short‐term stay in sober environment for 10 clients / 30 days / $33 per day. Estimated at $825 per month x 12 months.
Bed Days/SUD Treatment Funds to provide substance use disorder (SUD) assistance to clients for short‐term stay in sober environment for 3 clients / 30 days / $110 per day. Estimated at $1,375 per month x 12 months.
Bridge Housing This line represents the cost of three apartments located on Dakota Lane, leased by the program at a cost of $1200/ 2 units x 12 months, and $1072 x 2 units x 12 months Client Services Navigator 1.0 FTE paid at $21/hour
Administrative Assistant Position to assist clients at front desk and in the operation/support of HOPWA office functions. Position is 1.0 FTE and will be paid at $20/hour.
Fringe Benefits Calculated at 22.6% of total salaries
Supplies/Expendable Equipment This line item represents the cost of consumables such as paper, pens, clipboards, toner, etc.; for the program staff/facility. Calculated at an estimated $142.38 per month x 12 months.
Staff Travel/Training/Fuel Costs/Vehicle
Maintenance
Cost of fuel for leased vehicles, mileage reimbursements due to staff for use of their personal vehicle for program related travel, and vehicle maintenance. Additionally, cost allocated for possible staff training during the PY. Calculated at an estimated $2,800 for the PY.
Auto Lease Line item represents the cost of one car leased at $1050/month for 12 months.
Client Travel This line item represents the cost of client transportation via bus passes, etc.
Calculated at $500 per month.
Communications For the monthly connectivity fees associated with the program cell phones to be used by HOPWA program staff, desk phone, fedex cost , internet/cable, etc. Calculated at $218.83 per month x 12 months.
TBRA
Contractual TBRA‐FHA Contracted housing assistance through the Fresno Housing Authority for HOPWA clients as a part of the TBRA Voucher program. Cost include FHA staff hours and rental assistance, calculated at $17,000 per month for 12 months.
STRMU
Others‐STRMU Short‐Term Rent, Mortgage, Utilities assistance for HOPWA clients in need of such services. Calculated at an average monthly cost of $5692 per month for 12 months.
Indirect Costs Costs are comprised of administrative personnel and other such costs that support the program and are not covered in the line item budget. These costs include, but are not limited to, management, accounting, auditing, payroll, human resources, and technical support. Calculated at 24% of direct costs.
Housing Information Referral Services
Emergency Shelter
WESTCARE CALIFORNIA, INC.
FINANCIAL STATEMENTS
AND SUPPLEMENTAL INFORMATION
JUNE 30, 2022
WESTCARE CALIFORNIA, INC.
REPORT ON FINANCIAL STATEMENTS
JUNE 30, 2022
TABLE OF CONTENTS
PAGE
Independent Auditor’s Report 1-2
Financial Statements:
Statement of Financial Position 3
Statement of Activities 4
Statement of Cash Flows 5
Statement of Functional Expenses 6
Notes to the Financial Statements 7-13
Supplemental and Other Information:
Schedule of Expenditures of Federal Awards 14
Notes to Schedule of Expenditures of Federal Awards 15
Schedule of Findings and Questioned Costs 16
Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 17-18
Independent Auditor’s Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance 19-20
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of WestCare California, Inc.’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about WestCare California, Inc.’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole.
The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards is presented for purposes of additional analysis and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 3, 2023, on our consideration of WestCare California, Inc.’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering WestCare California, Inc.’s internal control over financial reporting and compliance.
Fresno, California
January 3, 2023
2 WESTCARE CALIFORNIA, INC.
STATEMENT OF FINANCIAL POSITION
JUNE 30, 2022
ASSETS
Cash and Cash Equivalents $ 7,711
Grant Contracts Receivable 10,509,418
Prepaid Expenses 239,527
Cash Restricted for Client Funds 162,218
Due from Related Organization 4,635,992
Property and Equipment, Net 4,306,494
Total Assets $19,861,360
LIABILITIES
Accounts Payable and Accrued Expenses $ 5,839,209
Accrued Salaries and Related Expenses 1,581,572
Due to Clients (Contra) 114,609
Deferred Revenue 3,292,252
Total Liabilities $10,827,642
NET ASSETS
Without Donor Restrictions 9,033,718
Total Net Assets 9,033,718
Total Liabilities and Net Assets $19,861,360
See accompanying notes to financial statements
3 WESTCARE CALIFORNIA, INC.
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2022
Change in Net Assets Without Donor Restrictions
Revenues and Other Support
Federal Contract Revenue $ 9,358,049
State Contract Revenue 5,334,568
STOP Contract 10,142,365
STOP Aftercare 20,423,500
County Contract Revenue 12,162,117
City Contract Revenue 1,121,616
Other Contract Revenue 716,135
Client Fees 1,851,088
Donations and Gifts 42,087
Other Revenue 27,088
Total Revenues and Other Support
Without Donor Restrictions $ 61,178,613
Expenses
Program Services
Grants and Program Support 51,520,272
Total Program Services 51,520,272
Supporting Services
General and Administrative 9,078,077
Total Supporting Services 9,078,077
Total Expenses 60,598,349
Change in Net Assets Without Donor Restrictions 580,264 Net Assets, Beginning of Year 8,453,454
Net Assets, End of Year $ 9,033,718
See accompanying notes to financial statements
4 WESTCARE CALIFORNIA, INC.
STATEMENT OF CASH FLOWS
JUNE 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Change in Net Assets Without Donor Restrictions $ 580,264 Adjustments to Reconcile Change in Net Assets
To Net Cash Provided by Operating Activities:
Depreciation 330,247
(Increase) or Decrease in:
Grants Receivable (1,087,727)
Prepaid Expenses (33,578)
Increase or (Decrease) in:
Accounts Payable and Accrued Expenses 1,409,964
Accrued Salaries and Related Expenses 123,070
Clients Funds (Contra) (132,480)
Deferred Revenue (307,326)
Net Cash Provided/(Used) in Operating Activities $ 882,434 CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Property and Equipment ( 69,187)
Net Cash Provided/(Used) in Investing Activities (69,187) CASH FLOWS FROM FINANCING ACTIVITIES:
Advances to Related Organization (2,131,535)
Net Cash Provided/(Used) in Financing Activities (2,131,535) Net Increase (Decrease) in Cash, Cash Equivalents, and
Restricted Cash (1,318,288)
Beginning Cash, Cash Equivalents, and Restricted Cash 1,487,217 Ending Cash, Cash Equivalents, and Restricted Cash $ 169,929 Supplemental Disclosure:
Interest Paid $ --
See accompanying notes to financial statements
5 GENERAL
FEDERAL STATE LOCAL OTHER PROGRAM TOTAL AND TOTAL
GRANTS GRANTS GRANTS GRANTS SUPPORT PROGRAM FUNDRAISING ADMINISTRATIVE EXPENSES
SALARIES AND RELATED EXPENSES
Salaries $ 2,923,784 $ 6,199,189 $ 7,943,024 $ 193,808 $ 203,969 $ 17,463,774 $ - $ 924,371 $ 18,388,145 Payroll taxes and employee benefits 454,631 554,915 806,364 15,463 15,894 1,847,267 - 2,190,360 4,037,627 TOTAL SALARIES AND RELATED EXPEN 3,378,415 6,754,104 8,749,388 209,271 219,863 19,311,041 - 3,114,731 22,425,772
OTHER EXPENSES
Building occupancy 234,203 754,990 508,618 27,742 29,651 1,555,204 66,492 1,621,696 Travel 15,295 86,262 41,242 5,915 317 149,031 26,347 175,378 Equipment costs 103,385 163,685 97,217 56,538 11,125 431,950 31,877 463,827 Repair and maintenance 38,504 143,869 115,095 3,890 4,260 305,618 25,460 331,078 Vehicles 197,991 168,920 205,800 33,892 2,521 609,124 3,668 612,792 Food costs 11,256 593,113 504,319 156 39 1,108,883 2,690 1,111,573 Program assistance and supplies 3,906,303 863,666 1,272,471 204,017 8,443 6,254,900 15,300 6,270,200 Purchased aftercare 20,423,500 20,423,500 - 20,423,500
Interest and taxes 15,699 5,339 3,931 1,816 531 27,316 20,960 48,276 Operating supplies and expenses 166,379 294,718 257,453 21,288 34,604 774,442 765,052 1,539,494 Legal settlements - - - - - - 67,300 67,300
Professional services 44,315 113,181 172,138 45,503 604 375,741 307,171 682,912 Management and administration - - - - - - 4,494,304 4,494,304 TOTAL OTHER EXPENSES 4,733,330 23,611,243 3,178,284 400,757 92,095 32,015,709 - 5,826,621 37,842,330
TOTAL EXPENSES BEFORE
DEPRECIATION 8,111,745 30,365,347 11,927,672 610,028 311,958 51,326,750 - 8,941,352 60,268,102 Depreciation 1,184 34,882 144,379 - 13,077 193,522 - 136,725 330,247 TOTAL EXPENSES $ 8,112,929 $ 30,400,229 $ 12,072,051 $ 610,028 $ 325,035 $ 51,520,272 $ - 9,078,077 $ 60,598,349 See accompanying notes to financial statements.
WestCare California, Inc.
STATEMENT OF FUNCTIONAL EXPENSES
Year Ended June 30, 2022
6 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 1 – ORGANIZATION AND NATURE OF ACTIVITIES:
Organization and Nature of Activities: WestCare California, Inc. is a tax exempt, nonprofit corporation governed by a volunteer board of directors incorporated in 1999 whose purposes include, but are not limited to the following:
A. To promote public awareness about chemical dependency and related issues and problems; and,
B. To promote recovery from chemical dependency and or related illnesses, through developing, establishing and/or maintaining of centers for the rehabilitation of individuals and their families.
C. To promote the health and well being of all citizens.
The Organization provides residential and out-patient rehabilitation programs, criminal justice programs, health related and a variety of prevention programs and services all of which are related to the purposes for which it is established.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting: The accompanying financial statements of the Organization have been prepared on the accrual basis in accordance with accounting principles generally accepted in the United States of America.
Basis of Presentation: Net assets and revenues, expenses, gains, and losses are classified based on the existence or absence of donor-imposed restrictions.
Accordingly, net assets of the Organization and changes therein are classified as follows:
Net assets without donor restrictions: Net assets that are not subject to donorimposed restrictions and may be expended for any purpose in performing the primary objectives of the Organization. These net assets may be used at the discretion of Management and the Board of Directors.
Net assets with donor restrictions: Net assets subject to stipulations imposed by donors and grantors. Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Organization or by the passage of time.
Other donor restrictions are perpetual in nature, whereby the donor has stipulated the funds be maintained in perpetuity.
7 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Measure of Operations: The statement of activities reports all changes in net assets, including changes in net assets from operating and non-operating activities. Operating activities consist of those items attributable to the Organization’s ongoing activities.
Non-operating activities are limited to resources that generate return from investments and other activities considered to be of a more unusual or nonrecurring nature.
Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures contained in the financial statements. Actual results could differ from those estimates.
Cash and Cash Equivalents: For purposes of the statement of cash flows, the Organization considers investments available for current use with an initial maturity of three months or less to be cash equivalents.
Concentrations of Credit Risk: Financial instruments that potentially subject the Organization to concentration of credit risk are cash and receivables. Concentration of credit risk with respect to receivables is limited because a substantial portion of these balances are due from federal and state governmental agencies. Management believes the Organization is not exposed to any significant credit risk on cash. The Organization maintains its cash in various bank accounts that, at times, may exceed federally insured limits. These accounts have been placed with high credit quality financial institutions.
On June 30, 2022, the Organization did not have cash in excess of the FDIC insured limit.
Receivables: Receivables are stated at the amount management expects to collect from balances outstanding at year end. The receivables are primarily contracts and/or grants from funding sources for services performed under cost reimbursement contracts. It is the practice of the Organization to record an allowance for doubtful accounts. Bad debts are charged to the allowance account as incurred. Based on management’s assessment of receivables it has concluded that an allowance is not necessary on June 30, 2022. Balances that are still outstanding after management has used reasonable collection efforts are written off to bad debt expense.
Revenue and Revenue Recognition: Revenue is recognized when earned. Program service fees and payments received in advance are deferred to the applicable period in which the related services are performed, or expenditures are incurred, respectively.
Contract Revenue: Revenue under some third-party payor agreements is subject to audit and retroactive adjustments. Provisions for estimated third-party payor settlements are provided in the period the related services are rendered, if determinable. 8 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Contributions: Contributions are recorded as income at the estimated value at date of receipt as net assets without donor restrictions or net assets with donor restrictions, depending on the existence and/or nature of any donor-imposed restrictions. No donations with donor-imposed restrictions have been received.
Conditional Promises to Give: Conditional promises to give, that is, those with a measurable performance or other barrier, and a right of return, are not recognized until the conditions on which they depend have been substantially met. Conditional gifts received prior to the satisfaction of conditions are recorded as refundable advances.
Donated Services and In-Kind Contributions: Volunteers contribute significant amounts of time to our program services, administration, and fundraising and development activities; however, the financial statements do not reflect the value of these contributed services because they do not meet recognition criteria prescribed by generally accepted accounting principles. Donated goods are recorded at fair value at the date of donation.
Donated services are recorded at the respective fair values of the services received. No significant contributions of such goods or services were received during the year ended June 30, 2022.
Due to/from related parties: Amounts as due to/from related parties, included in the accompanying statements of financial position, arise principally from the collaborative activities between the affiliates to further the mission of the Organization.
Property and Equipment: The Organization capitalizes property and equipment over $5,000. Lesser amounts are expensed. Purchased property and equipment is capitalized at cost. Donations of property and equipment are recorded as contributions at their estimated fair value. Such donations are reported as unrestricted contributions unless the donor has restricted the donated assets to a specific purpose. The cost of maintenance and repairs is charged to expense as incurred, significant renewals and betterments are capitalized. Property and equipment are depreciated using the straightline method over the estimated useful lives of the assets.
Compensated Absences: The Organization’s policy allows employees to accumulate vacation and sick leave based on the length of service, position, and other factors.
Accrual of vacation time is included in the accompanying financial statements. The total amount accrued for vacation on June 30, 2022 was $746,300.
Income Taxes: The Organization qualifies as a not-for-profit organization as described in Section 501 (c)(3) of the Internal Revenue Code and is tax exempt from federal and state income taxes, therefore no provisions for income taxes have been made.
Management is of the opinion that there is no unrelated business income subject to taxation. Management is also of the opinion that there are no material uncertain tax positions. All tax returns have been appropriately filed by the Organization. 9 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Functional Expenses: The financial statements report certain categories of expenses that are attributable to more than one program or supporting function. Therefore, these expenses require allocation on a reasonable basis that is consistently applied. The costs of providing the various programs and supporting services have been summarized on a functional basis in the statement of activities. The statement of functional expenses presents the natural classification detail of expenses by function. Such expenses are charged to grant programs and supporting services on the basis of program costs.
General and administrative costs include those expenses that are not directly identifiable with any specific program but provide for the overall support of the Organization. Accordingly, certain costs have been allocated among program services and supporting services benefited. Such allocations are determined by management on an equitable basis.
Salaries and benefits are charged directly to the program for which work has been done based on time and effort. Other expenses and overhead costs are based on staff allocation to functional areas.
NOTE 3 – CASH AND CASH EQUIVALENTS:
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the amounts shown in the statement of cash flows:
Cash and Cash Equivalents $ 7,711
Cash Restricted for Client Funds 162,218
Total Cash, Cash Equivalents, and Restricted Cash
shown in the Statement of Cash Flows $ 169,929
NOTE 4 – RESTRICTIONS ON ASSETS:
Restrictions, if any, on assets as of June 30, 2022, are related to grant awards and/or lending agreements. Such assets must be used in accordance with the purposes established by laws and regulations of the grants or agreements in contrast with unrestricted funds over which the governing board remained full control to use in achieving any of its organizational purposes.
Separate cash accounts are maintained as required by grant and/or lending agreements. The Organization also holds cash in trust for participants in various programs.
10 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 5– LIQUIDITY AND AVAILABILITY OF FINANCIAL ASSETS:
The following reflects the Organization’s financial assets available within one year of the statement of financial position date. There are no amounts reduced and not available for general use because of donor-imposed restrictions or long-term investments.
Cash and cash equivalents $ 7,711
Grant contracts receivable 10,509,418
Total available for general expenditures $10,517,129
As part of the Organization’s liquidity management, it utilizes a zero-balance account (zba) with WestCare Foundation, Inc., a checking account in which a balance of zero is maintained by automatically transferring funds from a master account in an amount only large enough to cover checks presented. This cash pooling system is designed to leave in the current accounts of the subsidiaries the minimum amounts to be able to deal with their debts contracted. The advantage of this system is to centralize the cash to be able to obtain better rates. In addition, the Organization transfers amounts as needed to meet cash flow needs through a related affiliate, WestCare Foundation, Inc.
NOTE 6 – PROPERTY AND EQUIPMENT, NET:
Property and equipment, net consisted of the following on June 30, 2022:
Land $ 391,095
Buildings and Improvements 5,979,190
Leasehold Improvements 1,261,595
Furniture and Fixtures 382,613
Computer Equipment 122,759
Vehicles 649,894
8,787,146
Less: Accumulated Depreciation (4,480,652)
Total Property and Equipment, Net $4,306,494
For the year ended June 30, 2022, depreciation expense totaled $330,247.
NOTE 7 – EMPLOYEE BENEFIT PLAN:
The Organization has a 401(k)-retirement plan covering eligible employees held with Voya Financial with a Safe Harbor Match. The Organization’s match is 3% of each qualified employee’s basic contribution plus an additional $.50 for each $1 contributed for the next 2% earnings. Plan contribution by the Organization for the year ended June 30, 2022 was $205,717.
11 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 8 – COMMITMENTS AND CONTINGENCIES:
Operating Leases:
As of June 30, 2022, the Organization had entered into various non-cancellable operating lease agreements for real property. The approximate minimum future commitments on an annual basis are as follows: 2023 $582,104, 2024 $442,059, 2025 $343,508, 2026 $114,828 and thereafter $-0-.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to recognize leases on the statement of financial position for most leases with a term longer than 12 months. The effective date for this standard has been delayed to reporting periods beginning after December 15, 2021.
Contingencies:
Federal Grants – The Organization receives financial assistance from the federal government in the form of grants and entitlements. Receipt of grants is generally conditioned upon compliance with terms and conditions of the grant agreements and applicable federal laws and regulations, including the expenditure of resources for eligible purposes. Accordingly, expenditures financed by these programs are subject to financial and compliance audits by the grantor agencies, which could result in request for reimbursement by the grantor agencies for expenditures, if disallowed by the granting agencies, cannot be determined at this time. Management believes that such disallowances, if any, will not have a material adverse effect on the financial position of the Organization.
NOTE 9 – DEFERRED REVENUE:
Deferred revenue consists of the following amounts as of June 30, 2022:
Donation from Bezos Day one Families for Homeless $2,234,593 Contra Costa – COVID Rate 669,622
Other 388,037
$3,292,252
NOTE 10 – ECONOMIC DEPENDENCY:
The Organization receives a significant portion of its support and revenues from contracts and/or agreements with agencies of the Government of the United States. The Organization’s ability to continue operating is predicated on the government’s continued support and funding of its programs. The continuation of program services in the subsequent year is expected based on contract renewals and continuations received to date. A significant reduction in the level of this funding, if this were to occur, could have an adverse effect on the programs and activities.
12 WESTCARE CALIFORNIA, INC.
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2022
NOTE 11 – RELATED PARTY TRANSACTION:
WestCare Foundation, Inc. is a managing and governing oversight organization for WestCare California, Inc. During the year ending June 30, 2022, WestCare Foundation, Inc. received management fees for general and administrative expenses of $4,494,304 from WestCare California, Inc.
In addition, WestCare California, Inc. has advanced funds as of June 30, 2022 to WestCare Foundation, Inc. for $4,635,992.
NOTE 12 – COVID-19 PANDEMIC:
The COVID-19 pandemic, whose effects first became known in January 2020, is still having a broad and negative impact on commerce and financial markets around the world. The United States and global markets experienced significant declines in value resulting from uncertainty caused by the pandemic. The Organization continues to closely monitor its liquidity and impact of potential declines in operations. Accordingly, the extent to which COVID-19 may impact the Organization’s financial position and changes in net assets and cash flows remains uncertain and the accompanying financial statements include no adjustments relating to the effects of this pandemic.
NOTE 13 – SUBSEQUENT EVENTS:
The Organization has evaluated subsequent events through January 3, 2023, the date which the financial statements were available to be issued and has determined that there were no events occurring during that period that required disclosure to the accompanying financial statements.
END OF NOTES TO THE FINANCIAL STATEMENTS
13 WESTCARE CALIFORNIA, INC.
SUPPLEMENTAL MATERIAL
Pass through Federal Federal Transfers to
Identifying # CFDA# Expenditures Subrecipients
US Department of Housing & Urban Development
Emergency Solutions Grant Program
Pass Through Award(s):
Fresno County - ESG MAP (CA) A-18-338 14.231 149,753 -
Fresno County - Diversion (CA) A-19-259 14.231 342,694 - Fresno County-ESG-CV 2019-096 14.231 114,415
City of Fresno - ESG Project Unite (CA) 2021-101 14.231 154,891 Total Emergency Solutions Grant Program 761,753 -
Housing Opportunities for Persons with AIDS (HOPWA)
Pass Through Award(s):
City of Fresno (CA) 2020-237 14.241 677,765 61,112
Housing Opportunities for Persons with AIDS (HOPWA) 677,765 61,112 Continuum of Care Program
Direct Award(s):
Continuum of Care Program (CA)-Project LiftOff 14.267 306,458 3,695 Continuum of Care Program (CA)-Coordinated Entry 14.267 404,100 - Total Continuum of Care Program 710,558 3,695
Department of Veterans Affairs
VA Homeless Providers Grant and Perdiem Program
Direct Award(s):
VA Capital Grant & Per Diem (CA) 64.024 688,477
Veterans Grant Program-Case Management 64.024 75,081 -
Total VA Homeless Providers Grant and Perdiem Program 763,558 - VA Supportive Services for Veteran Families Program
Direct Award(s):
5,740,187 -
499,504 -
VA Supportive Services for Veterans Families (CA) - FY 21 64.033 VA Supportive Services for Veterans Families (CA) - COVID 19 - CARES 64.033 VA Supportive Services for Veterans Families (CA) - Shallow Subsidy Serv 64.033 226,263 Total VA Supportive Services for Veteran Families Program 6,465,954 - US Department of Health & Human Services:
Substance Abuse and Mental Health Services Projects of Regional and National Significance Direct Award(s):
SAMHSA BEAT HIV/AIDS (CA) 93.243 543,341 -
SAMHSA Opening Doors to Housing and Wellness 93.243 298,721 - SAMHSA MAT PDOA 93.243 208,818 10,975
SAMHSA Youth and Family Tree 93.243 242,950 -
SAMHSA Fresno City College 93.243 241,583 -
Total Substance Abuse and Mental Health Services Projects 1,535,413 10,975 Block Grants for the Prevention and Treatment of Substance Abuse Pass Through Award(s):
US Probation & PreTrial (CA) 0972-2016-19 93.959 124,150 Sierra Health Foundation SOS MLK 0972-21-14SR 93.959 35,362 Siera Health Foundation- Telehealth Bakersfield 93.959 11,381 Siera Health Foundation- Telehealth Belmont 93.959 12,573 Siera Health Foundation- Telehealth Hanford 93.959 10,664 Sierra Health Foundation SOS 93.959 8,521
Sierra Health Foundation Richmond 93.959 1,810
Total Block Grants for the prevention and Treatment of Substance Abuse 204,461 - Total Expenditures of Federal Awards $ 11,119,462 $ 75,782 WESTCARE CALIFORNIA, INC.
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
14 The accompanying notes are an integral part of this schedule.
WESTCARE CALIFORNIA, INC.
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
NOTE A - BASIS OF PRESENTATION:
The accompanying schedule of expenditures of federal awards include the federal award activity of WestCare California, Inc. under programs of the federal government for the year ended June 30, 2022. The information in the schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of WestCare California, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of WestCare California, Inc.
NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Expenditures reported on the Schedule are reported on the accrual basis of accounting.
Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
NOTE C – INDIRECT COST RATE:
WestCare California, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. WestCare California, Inc. has a provisional indirect rate agreement for 26% for the year ended June 30, 2022. 15 WESTCARE CALIFORNIA, INC.
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FEDERAL PROGRAMS
FOR THE YEAR ENDED JUNE 30, 2022
Section I – Summary of Auditor’s Results
Financial Statements
Type of auditor’s report issued on whether the financial statements audited were prepared in accordance with GAAP: Unmodified Internal control over financial reporting:
• Material weakness(es) idenitifed? No
• Significant deficiency(ies) identified? None reported Noncompliance material to financial statements noted? No Federal Awards
Internal control over major programs:
• Material weakness(es) identified? No
• Significant deficiency(ies) identified? None reported Types of auditor’s report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with CFR 200.516(a)? No
Identification of major programs:
Federal Program or Cluster Federal CFDA No.
VA Homeless Providers Grant 64.024
Substance Abuse and Mental Health Services 93.243
Block Grants for Prevention & Treatment Substance Abuse 93.959 Dollar threshold used to distinguish between type A & type B Programs:
Federal Programs: $750,000
Auditee qualified as low-risk auditee pursuant to Uniform Guidance: Yes
Section II – Financial Statement Findings
None reported
Section III – Federal Award Findings and Questioned Costs None reported
Section IV – Other Issues/Prior Year Audit Findings
No management letter is required because there were no findings required to be reported in the management letter.
No Summary Schedule of Prior Audit Findings is required because there were no prior audit findings.
No Corrective Action Plan is required because there were no findings required to be reported. 16 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether WestCare California, Inc.’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the organization’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the organization’s internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Fresno, California
January 3, 2023
18 conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about WestCare California, Inc.’s compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding WestCare California, Inc.’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.
• Obtain an understanding of WestCare California, Inc.’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of WestCare California, Inc.’s internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with the type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be significant deficiencies or material weaknesses in internal control. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Fresno, California
January 3, 2023
20 COMMUNITY
MEDICAL CENTERS
February 15, 2024
City of Fresno
Planning and Development Department
Community Development Division (HCDD)
2600 Fresno Street
Fresno, CA 93721
Re: Letter of Support for WestCare California, Inc.
Dear Grant Review Committee:
Community Medical Centers, Community Regional Medical center (CRMC) is pleased to support WestCare California's grant application in response the City of Fresno's Housing Opportunities for People with AIDS (HOPWA) Notice of Funding Availability. WestCare is an important partner, and its work to prevent the spread of HIV in Fresno County continues to be greatly needed and highly valued.
CRMC has worked with WestCare since 2006, and we have found its staff to be highly knowledgeable in HIV prevention, testing, and outreach. They provide program participants with the tools, resources, and referrals necessary to achieve their goals and thrive in their lives.
WestCare is a recognized leader in providing effective services in a culturally competent, traumainformed, and gender-responsive environment. They have devoted significant resources to understanding and successfully addressing the needs of Fresno's most vulnerable residents.
We look forward to continuing our critical work with WestCare California and improving the quality of life for our entire community. We highly recommend your favorable consideration of their grant proposal.
Respectfully,
Cory Belliston, Chief Operating Officer
Post-Acute Services, CRMC
P.O. Box 1232. Fresno, Calitorma 93715-1232 • www.communitymedical.org Community Regional Medical Center • Clovis Community Medical Center • Fresno Heart & Surgical Hospital • Community Behavioral Health Center California Cancer Center • Community Health Center-Serra • Community Subacute 8 Transitional Care Center January 24, 2024
City of Fresno
Planning and Development Department
Community Development Division (HCDD)
2600 Fresno Street
Fresno, CA 93721
Re: Letter of Support for WestCare California, Inc.
Dear Grant Review Committee:
Fresno Housing is pleased to support WestCare California’s grant application in response the City of Fresno’s Housing Opportunities for People with AIDS (HOPWA) Notice of Funding Availability. WestCare is an important partner, and its work to prevent the spread of HIV in Fresno County continues to be greatly needed and highly valued.
Fresno Housing has worked with WestCare since 2014, and we have found its staff to be highly knowledgeable in HIV prevention, testing, and outreach. They provide program participants with the tools, resources, and referrals necessary to achieve their goals and thrive in their lives. WestCare is a recognized leader in providing effective services in a culturally competent, trauma-informed, and gender-responsive environment. They have devoted significant resources to understanding and successfully addressing the needs of Fresno’s most vulnerable residents.
We look forward to continuing our critical work with WestCare California and improving the quality of life for our entire community. We highly recommend your favorable consideration of their grant proposal.
Respectfully,
Doreen Eley
Assistant Director, Resident Empowerment
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Self-Help Enterprises
PY 2024-2025 CONSOLIDATED NOFA
PART A – COVER PAGE:
NON-PROFIT ORGANIZATION1
Part A, Section 1: General Information
Legal Name of the Organization: Fictitious Name (if applicable):
Self-Help Enterprises
UEI of Organization: Federal Tax ID Number:
056179906 94-1592676
Date of Incorporation: Date of 501(c)(3) Determination:
January 14, 1965 April 1965
Mailing Address of Organization: Organization Website Address:
P.O. Box 6520, Visalia, CA 93291 www.selfhelpenterprises.org Name of President (or Chair of the Board): E-mail Address:
Thomas J. Collishaw, President/CEO [email protected] Name of Chief Executive or Executive Director: E-mail Address:
Thomas J. Collishaw, President/CEO [email protected] Name of the Secretary: E-mail Address:
David Ebenezer, Secretary [email protected] Name of Treasurer (or Chief Financial Officer): E-mail Address:
David Ebenezer, CFO [email protected]
Principal Contact
Person: Principal Contact’s Title:
Principal Contact’s Physical
Address (Street Address, Suite,
City, State, ZIP):
Christy Hodson Administrative Analyst
8445 W. Elowin Court
Visalia, CA 93291
Primary Phone #: Alternative Phone #: E-mail Address:
559-802-1585 559-651-1000 [email protected] Name of Authorized Signatory: Title of Authorized Signatory:
Betsy McGovern-Garcia Vice President
Signature of Authorized Official: Date of Signature:
1 This document is for non-profit organizations. Units of local government, please complete Part A: Unit of Government Information
2/16/24
PY23-24 City of Fresno Consolidated NOFA Part A
Non-Profit Organization
Part A, Section 2: Mission Statement
Please provide the organization’s mission statement within the below space:
"Working together with low-income families to build and sustain healthy homes and communities."
Part A, Section 3: Organizational Capacity and Management Please provide key personnel information for HUD-funded projects:
Staff Name Title
Years of
Experience
1) Melissa Valdez Assistant Director 21 Years
2) Matt Fultz Project Manager 6 Years
3) Gerardo Gomez Project Manager 24 Years
4) Adam Nance Project Manager 2 Years
5) Christy Hodson Administrative Analyst 3 Years
Board of Directors
How often does your Board of Directors regularly meet?
Once per month (Fourth Tuesday of each month)
List current Board of Directors below:
1) Martha Renteria, Chair 6) Olivia Gomez
2) Yolanda Meraz, Vice Chair 7) Gary Rodriguez
3) Mike Carnes 8) Harold Liles
4) Steve Montes 9) Lupe Martinez
5) Kayode Kadara 10) Susan Zachary-Kreps
PY23-24 City of Fresno Consolidated NOFA Part A
Non-Profit Organization
Financial Management
1) Has an audit been performed on the proposing organization’s accounting procedures within the last two years?
Yes No If yes, name of
auditor: Price Page & Co
2) Is the agency audited every year? Yes No
3) Were any management letters issued as a result of the last audit? If yes, explain.
No
4) Provide the name of staff responsible for your agency’s accounting system Name: David Ebenezer
Title: Chief Financial Officer
Phone/Email: 559-802-1602/ [email protected] Authorized Signatories
If your organization is selected for funding, signatures from persons bearing titles from each of the two lines below will be required by your organization.
1. Board Chair, President, or Vice President
2. Treasurer, Secretary, or Assistant Secretary
If you will be unable to provide the two requested signatures or intend to otherwise deviate from the standard signature authority, please indicate the names and titles of the authorized signatories below and provide the names and titles of the person(s) authorized to execute agreements on behalf of your organization in your boardcertified resolution.
Authorized Signatory Name Authorized Signatory Title
1)
2)
Board Resolution providing for the signature authority of persons to sign agreements on behalf of the entity is attached (required before a subrecipient agreement will be executed).
To view the City’s policy regarding signature authority, including a sample signature page and sample certification, view Administrative Order 4-1 at:
https://www.fresno.gov/personnel/human-resources-support/#tab-2 PY23-24 City of Fresno Consolidated NOFA Part A
Non-Profit Organization
Part A, Section 4: Summary of Attached Applications:
Provide number and total dollar amount of applications by Application Type Homeless and Homelessness Prevention Programs
Number of Applications Total Dollar Amount Requested
$
Owner-Occupied Home Repair
Number of Applications Total Dollar Amount Requested
1 $ 500,000.00
Public and Community Services
Number of Applications Total Dollar Amount Requested
$
Fair Housing
Number of Applications Total Dollar Amount Requested
$
=
GRAND TOTAL
Number of Applications
0 Total Dollar Amount Requested
$ 500,000.00
PY23-24 City of Fresno Consolidated NOFA Part A
Non-Profit Organization
Required Attachments to Part A
Select all attachments included.
Part A, Exhibit 1 – Organization’s U.S. Internal Revenue Service 501(c)(3) Determination of Exemption Letter (Required)
Part A, Exhibit 2 – Organization’s Articles of Incorporation (Required) Part A, Exhibit 3 – Bylaws of the Organization (Required) Part A, Exhibit 4 – Statement and Designation by Foreign Corporation (when location of incorporation was outside of California) (Required of Out-of-State Corporations only)
Part A, Exhibit 5 – List of Directors and Officers by Corporate Title and Name (Required)
Part A, Exhibit 6 – Most Recent Audited Financial Statement (an IRS 990, Return of Organization Exempt from Income Tax, may be submitted in lieu of an audit whenever the organization lacks an audit due it not exceeding California and Federal audit thresholds).
Part A, Exhibit 7 – Indirect Cost Rate Agreement with Federal Cognizant Agency (Required if applicant seeks to charge an indirect cost rate greater than 10 percent of modified total direct costs)
Part A, Exhibit 8 – Resolution of the Board of the Directors Authorizing the Application and Naming the Persons Authorized to Sign the Application (Required; the Resolution must be submitted to the City by 5 PM, March 1, 2024) Part A, Exhibit 1
024792
IRSDepartment of the Treasury
Internal Revenue Service
P.O. Box 2508
Cincinnati OH 45201
SELF HELP ENTERPRISES
PO BOX 6520
VISALIA CA 93290
Employer ID number: 94-1592676
Form 990 required: Yes
Dear Taxpayer:
In reply refer to: 0248230137
May 28, 2021 LTR 4168C 0
94-1592676 000000 00
00010737
BODC: TE
We're responding to your request dated May 20, 2021, about your tax-exempt status.
We issued you a determination letter in April 1965, recognizing you as tax-exempt under Internal Revenue Code (IRC) Section 501(c) (3).
We also show you're not a private foundation as defined under IRC Section 509(a) because you're described in IRC Sections 509(a)(1) and 170(b)(1)(A)(vi).
Donors can deduct contributions they make to you as provided in IRC Section 170. You're also qualified to receive tax deductible bequests, legacies, devises, transfers, or gifts under IRC Sections 2055, 2106, and 2522.
In the heading of this letter, we indicated whether you must file an annual information return. If you're required to file a return, you must file one of the following by the 15th day of the 5th month after the end of your annual accounting period:
- Form 990, Return of Organization Exempt From Income Tax - Form 990EZ, Short Form Return of Organization Exempt From Income Tax
- Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ - Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Trust Treated as Private Foundation
According to IRC Section 6033(j), if you don't file a required annual information return or notice for 3 consecutive years, we'll revoke your tax-exempt status on the due date of the 3rd required return or notice.
You can get IRS forms or publications you need from our website at www.irs.gov/forms-pubs or by calling 800-TAX-FORM (800-829-3676).
If you have questions, call 877-829-5500 between 8 a.m. and 5 p.m., 0248230137
May 28, 2021 LTR 4168C 0
94-1592676 000000 00
00010738
SELF HELP ENTERPRISES
PO BOX 6520
VISALIA CA 93290
local time, Monday through Friday (Alaska and Hawaii follow Pacific time).
Thank you for your cooperation.
Sincerely yours,
Warren R. Burton, Operations Mgr
Accounts Management Operations 1
Part A, Exhibit 2
Part A, Exhibit 3
Part A, Exhibit 5
Board of Directors
2024
Martha Renteria, Chair
Yolanda Meraz, Vice Chair
Susan Zachary-Kreps
Olivia Gomez
Dolores Salgado
Kayode Kadara
Harold Liles
Gary Rodriguez
Lupe Martinez
Mike Carnes
Steve Montes
Tina Sumner
Tim Denton
Ivan Lopez
Veronica Lopez
Miguel Perez
Corporate Officers
Thomas J. Collishaw, President
Elizabeth McGovern Garcia, Vice President
David Ebenezer, Secretary
Ethan Dutton, Asst. Secretary
Ricky J. Gonzalez, Asst. Secretary
8445 W. Elowin Court . P.O. Box 6520 . Visalia, CA 93290 Phone (559) 651-1000 . Fax (559) 651-3634 . [email protected] . www.selfhelpenterprises.org A Nonprofit Housing and Community Development Organization 55 Part A, Exhibit 6
CONSOLIDATED FINANCIAL STATEMENTS
WITH SUPPLEMENTARY INFORMATION
FOR THE YEARS ENDED
JUNE 30, 2022 AND 2021
SELF-HELP ENTERPRISES
CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
TABLE OF CONTENTS
Page
INDEPENDENT AUDITOR’S REPORT .......................................................................................................1
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Statements of Financial Position .....................................................................................5 Consolidated Statements of Activities ...................................................................................................6 Consolidated Statements of Functional Expenses ................................................................................8 Consolidated Statements of Cash Flows ............................................................................................10 Notes to the Consolidated Financial Statements ................................................................................11
SUPPLEMENTARY INFORMATION
Independent Auditor’s Report on Supplementary Information ............................................................49 Consolidating Statement of Financial Position ....................................................................................51 Consolidating Statement of Activities ..................................................................................................52 Consolidating Statement of Cash Flows .............................................................................................53 Combining Statement of Financial Position .........................................................................................54 Combining Statement of Activities .......................................................................................................55 Schedule of Construction Activity ........................................................................................................56
SINGLE AUDIT
Schedule of Expenditures of Federal Awards .....................................................................................58 Notes to Schedule of Expenditures of Federal Awards .......................................................................59 Schedule of Expenditures of State Awards .........................................................................................60 OTHER INDEPENDENT AUDITOR’S REPORTS
Independent Auditor’s Report on Internal Control Over
Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in
Accordance with Government Auditing Standards ............................................................................61 Independent Auditor’s Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance ........................................................................................................................63 SCHEDULE OF FINDINGS AND QUESTIONED COSTS ........................................................................65 SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS ...........................................................................66 1 INDEPENDENT AUDITOR’S REPORT
To the Board of Directors of
Self-Help Enterprises
Visalia, California
Report on the Audit of the Consolidated Financial Statements Opinion
We have audited the accompanying consolidated financial statements of Self-Help Enterprises (a nonprofit organization), and its wholly-owned subsidiaries, (the “Organization”) which comprise the consolidated statements of financial position as of June 30, 2022, and the related consolidated statements of activities, functional expenses, and cash flows for the year then ended, and the related notes to the consolidated financial statements.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Self-Help Enterprises and its wholly owned subsidiaries as of June 30, 2022, and the changes in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
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. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Organization and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, which raise substantial doubt about the Organization’s ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.
2 Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Organization’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Organization’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
We did not audit the financial statements of Self-Help Communities I, LLC, Nueva Sierra Vista Associates, Caliente Creek Partners, Casitas Del Sol Partners, Villa Santa Guadalupe Partners, Cottonwood Creek Partners, Goshen Village Partners, Rolling Hills Partners, Sand Creek Partners, Sunrise Villa Partners, Villa Del Rey Partners, Villa Hermosa Partners, and Washington Plaza Partners, wholly-owned subsidiaries. Those statements were audited by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for those subsidiaries, is based solely on the reports of the other auditors.
Together, the subsidiaries’ financial statements increased assets by $41,381,665, liabilities by $38,060,134, net assets by $3,321,531, revenues and support by $5,621,637, expenses by $8,270,825 and decreased changes in net assets by $2,649,188.
Supplementary Information
Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, is presented for purposes of additional analysis and is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the 3 schedule of expenditures of federal awards is fairly stated, in all material respects, in relation to the consolidated financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 16, 2022, on our consideration of the Organization’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Organization’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Organization’s internal control over financial reporting and compliance.
Clovis, California
December 16, 2022
4 THIS PAGE IS LEFT BLANK INTENTIONALLY.
See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 5 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
JUNE 30, 2022 AND 2021
2022 2021
ASSETS
Current assets:
Cash and cash equivalents $ 13,016,834 $ 7,717,305
Accounts receivable 7,410,324 5,699,337
Securities (at fair value) 5,008,156 5,353,008
Grants receivable 9,508,662 6,044,715
Interest receivable 428,058 220,504
Notes receivable - current portion 2,067,316 1,730,943
Prepaids and deposits 438,301 730,317
Construction funds receivable 653,290 -
Construction in progress 5,362,596 14,575,307
Total current assets 43,240,247 42,724,726
Other assets:
Notes receivable net of current portion 33,481,287 32,541,993 Investment in affiliates 3,085,121 2,503,292
Investment in affiliates at fair value 81,109 213,307
Restricted cash 6,736,713 6,740,486
Impound/reserve accounts 5,538,453 4,179,854
Intangible assets, net 282,934 282,934
Land held for development 17,709,341 10,866,576
Total other assets 66,914,958 57,328,442
Property, plant and equipment, net 49,574,423 32,996,654 Total assets $ 159,729,628 $ 133,049,822
LIABILITIES AND NET ASSETS
Current liabilities:
Accounts payable and accrued expenses $ 5,352,805 $ 4,849,980 Construction funds payable 305,878 -
Deferred grants 5,711,834 6,786,483
Notes payable - current portion 2,014,442 3,137,051
Total current liabilities 13,384,959 14,773,514
Long term liabilities:
Other long-term payables 2,862,536 2,315,615
Accrued interest payable - deferred notes 13,093,870 8,298,818 Deferred loans 20,918,125 20,202,737
Notes payable net of current portion 49,439,633 34,687,342 Total liabilities 99,699,123 80,278,026
Net assets:
Net assets without donor restrictions 56,222,275 48,825,539 Net assets with donor restrictions 3,808,230 3,946,257
Total net assets 60,030,505 52,771,796
Total liabilities and net assets $ 159,729,628 $ 133,049,822 See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 6 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
Without With
Donor Restrictions Donor Restrictions Total
Revenues, gains and other support
Grants $ 24,109,010 $ 24,109,010 - $
Contract income 6,216,000 6,216,000 -
Interest income 382,453 5,668 388,121
Investment gains (losses) (458,686) (13,140) (471,826)
Land/development sales 7,607,387 7,607,387 -
Developer fees 6,810,074 6,810,074 -
Contributions 1,301,560 22,036 1,323,596
Earned loan forgiveness 144,518 144,518 -
Other income 173,845 173,845 -
Rental income - 8,190,491 8,190,491
Total revenues, gains and other support
before net assets released from restrictions 54,476,652 14,564 54,491,216 Net assets released from restrictions 152,591 - (152,591) Total revenues, gains and other support
after net assets released from restrictions 54,629,243 (138,027) 54,491,216 Expenses
Program services 49,809,148 - 49,809,148
Supporting services 2,248,547 2,248,547 -
Fundraising - 11,620 11,620
Total expenses - 52,069,315 52,069,315
Increase (decrease) in net assets 2,559,928 (138,027) 2,421,901 Net assets, beginning of year 48,825,539 3,946,257 52,771,796 Contributed Capital - 4,836,808 4,836,808
Net assets, end of year $ 56,222,275 $ 3,808,230 $ 60,030,505 See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 7 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2021
Without With
Donor Restrictions Donor Restrictions Total
Revenues, gains and other support
Grants $ 13,953,241 $ 13,953,241 - $
Contract income 4,987,309 4,987,309 -
Interest income 283,560 6,416 289,976
Investment gains 712,147 4,825 716,972
Land/development sales 5,391,822 5,391,822 -
Developer fees 3,656,690 3,656,690 -
Contributions 1,084,780 29,947 1,114,727
Earned loan forgiveness 1,684,700 1,684,700 -
Other income 464,196 464,196 -
Rental income - 6,972,554 6,972,554
Total revenues, gains and other support
before net assets released from restrictions 39,190,999 41,188 39,232,187 Net assets released from restrictions 90,625 - (90,625) Total revenues, gains and other support
after net assets released from restrictions 39,281,624 (49,437) 39,232,187 Expenses
Program services 31,959,558 31,959,558 -
Supporting services 1,833,422 1,833,422 -
Fundraising - 11,302 11,302
Total expenses 33,804,282 - 33,804,282
Increase (decrease) in net assets 5,477,342 (49,437) 5,427,905 Net assets, beginning of year 43,348,197 3,995,694 47,343,891 Net assets, end of year $ 48,825,539 $ 3,946,257 $ 52,771,796 See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 8 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2022
Program General & Total
Services Administrative Fundraising Expenses
Salaries and fringe benefits $ 12,783,300 $ 1,969,619 $ 14,758,271 5,352 $ Contract services 1,304,171 59,327 1,363,515 17
Travel 375,879 11,574 387,453 -
Space 3,255,611 20,042 3,275,727 74
Depreciation 3,577,022 19,782 3,596,880 76
Equipment rent/lease/purchase 328,478 46,610 375,165 77 Telephone 206,413 12,583 219,011 15
Insurance 513,344 49,005 562,400 51
Supplies 148,636 6,586 3,003 158,225
Postage 34,870 2,332 37,209 7
Project costs 18,280,706 - 18,280,706 -
Participant financing 188,923 - 188,923 -
Interest expense 1,060,053 - 1,060,053 -
Cost of sales 7,001,120 - 7,001,120 -
Other costs 737,170 51,087 2,948 791,205
Reserve expenses - 13,452 - 13,452
Total expenses $ 49,809,148 $ 2,248,547 $ 11,620 $ 52,069,315 See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 9 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2021
Program General & Total
Services Administrative Fundraising Expenses
Salaries and fringe benefits $ 10,874,584 $ 1,647,547 $ 12,527,396 5,265 $ Contract services 1,314,955 54,675 1,369,644 14
Travel 248,306 2,724 251,032 2
Space 2,345,280 21,498 2,366,858 80
Depreciation 2,406,335 12,019 2,418,410 56
Equipment rent/lease/purchase 191,572 26,416 534 218,522 Telephone 152,798 10,913 163,740 29
Insurance 466,844 43,090 509,989 55
Supplies 114,863 3,714 2,354 120,931
Postage 30,072 1,794 31,872 6
Project costs 7,425,644 - 7,425,644 -
Participant financing 93,361 - 93,361 -
Interest expense 814,978 - 814,978 -
Cost of sales 4,326,040 - 4,326,040 -
Other costs 1,058,553 9,032 2,907 1,070,492
Reserve expenses - 95,373 - 95,373
Total expenses $ 31,959,558 $ 1,833,422 $ 11,302 $ 33,804,282 See Independent Auditor’s Report and Notes to the Consolidated Financial Statements. 10 SELF-HELP ENTERPRISES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30, 2022 AND 2021
2022 2021
Cash flows from operating activities:
Increase (decrease) in net assets $ 2,421,901 $ 5,427,905 Adjustments to reconcile increase in net assets to
net cash from operating activities:
Depreciation 3,596,880 2,418,410
Unrealized (gain) loss on marketable securities 471,826 (716,972) Unrealized gain on investments in affiliates (449,631) (1,263,853) Earned loan forgiveness (144,518) (1,684,700)
Recovery of impairment loss (134,400) (313,600)
Changes in operating assets and liabilities:
Accounts and grants receivable (5,376,233) (3,748,172)
Prepaid expenses and other assets 279,524 (136,393)
Impound/reserve accounts (430,840) (112,214)
Construction fund receivables, loans and grants 653,290 (575,335) Construction-in-progress 2,369,946 (2,291,813)
Accounts payable, accrued interest and expenses 5,726,615 1,098,235 Construction fund payable, loans and grants 493,538 2,780,250 Net cash provided by operating activities 9,477,898 881,748 Cash flows from investing activities:
Payments for purchases of property, plant and equipment (5,696,589) (831,455) Advances on notes receivable (5,554,516) (9,558,019)
Payments received on notes receivable 4,242,268 4,231,949 Deposits to reserves 170,810 187,945
Cash from consolidation of subsidiary 379,162 -
Withdrawals from reserves (113,427) (95,374)
Purchases of marketable securities (1,291,101) (1,677,585) Sales of marketable securities 1,164,127 2,920,141
Net cash used in investing activities (6,699,266) (4,822,398) Cash flows from financing activities:
Proceeds from borrowing on long-term debt 9,028,385 2,303,922 Principal payments on long-term debt (6,511,261) (2,004,864) Proceeds from line of credit 2,500,000 750,000
Payments on line of credit (2,500,000) (750,000)
Net cash provided by financing activities 2,517,124 299,058 Net increase (decrease) in cash and cash equivalents 5,295,756 (3,641,592) Cash and cash equivalents, beginning of year 14,457,791 18,099,383 Cash and cash equivalents, end of year $ 19,753,547 $ 14,457,791 Reconciliation to consolidated statement of financial position:
Unrestricted cash and cash equivalents $ 13,016,834 $ 7,717,305 Restricted cash and cash equivalents 6,736,713 6,740,486 Total reconciliation to consolidated statement of financial position 19,753,547 $ $ 14,457,791 Supplemental disclosure of cash payments for:
Interest $ 399,916 $ 373,275
Supplemental cash flow activities related to acquisitions of wholly-owned subsidiaries:
Cash and cash equivalents $ 379,162 $ -
Accounts receivable 38,816 -
Impound accounts 985,142 -
Prepaid expenses 33,551 -
Property, plant, and equipment 14,297,617 -
Accounts payable and accrued expenses (158,686) -
Accrued interest (2,087,904) -
Long-term debt (8,650,890) -
Contributed capital - (4,836,808)
Total $ - - $
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
11 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Activities
Self-Help Enterprises (the “Organization”) is a nonprofit corporation organized in 1965. The Organization was formed for the purpose of improving the living conditions of low-income residents of the San Joaquin Valley (the “Valley”) of Central California. The Organization is dedicated to the belief that a decent, safe, secure, and healthy home is a basic building block of family, neighborhood and community. To this end, the Organization is committed to the creation of affordable housing, preservation of affordable housing stock, and improvement of existing housing affordable to low-income Valley households. The Organization also assists communities in meeting basic infrastructure needs, such as safe drinking water. The Organization’s “self-help” approach encourages the participation of low-income individuals in direct services, decision-making, and developing skills for self-sufficiency. It is the philosophy of the Organization to work with, rather than for, these individuals and their communities to complement local efforts to meet their housing and related needs.
The Organization provides technical assistance and supervision to low-income families as they build their own homes, oversees the rehabilitation or purchase of existing homes for low-income families, assists small and rural communities in obtaining or improving water and sewer services, develops multifamily rental housing projects for farm workers and other low-income families, provides assistance to first-time homebuyers and serves our communities in other outreach activities around emergency preparedness and leadership development.
Basis of Presentation
The financial statements of the Organization have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”), which requires information regarding its financial position and activities be reported according to the following net asset classifications:
Net assets without donor restrictions – Net assets that are not subject to donor – imposed restrictions and may be expended for any purpose in performing the primary objectives of the Organization. These net assets may be used at the discretion of the Organization’s management and Board of Directors.
Net assets with donor restrictions – Net assets subject to stipulations imposed by donors and grantors.
Some donor restrictions are temporary in nature; those restrictions will be met by actions of the Organization or the passage of time. Other donor restrictions are perpetual in nature, whereby the donor has stipulated the funds be maintained in perpetuity.
Method of Accounting
The Organization uses the accrual basis method of accounting in accordance with accounting principles generally accepted in the United States of America.
Principles of Consolidation
The consolidated financial statements include the accounts of Self-Help Enterprises; North Park Apartment Housing Corporation; Self-Help Communities I, LLC; Nueva Sierra Vista Associates; Caliente Creek Partners; Casitas Del Sol Partners; Villa Santa Guadalupe Partners; Cottonwood Creek Partners; Goshen Village Partners; Rolling Hills Partners; SHE-TSH, LLC; Sunrise Villa Partners; Villa Hermosa Partners; Sand Creek Partners; Villa del Rey Partners; and Washington Plaza Partners. All significant interrelated items and transactions have been eliminated in the consolidation.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
12 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Principles of Consolidation (Continued)
North Park Apartment Housing Corporation (“North Park”) is a nonprofit corporation controlled by Self-Help Enterprises. The corporation is exempt from income taxes under Internal Revenue Service Code 501(c)(3) and section 23701(d) of the State of California Corporations Code. North Park operates North Park Apartments, a 104-unit low-income apartment complex located in Oildale, California. The acquisition and rehabilitation of the apartment complex was facilitated by the Organization under the Low-Income Housing Preservation and Resident Home Ownership Act of 1990.
Self-Help Communities I, LLC (“SHC I”) is a California limited liability company, the sole member of which is Self-Help Enterprises. SHC I owns and operates Gateway Village, a 48-unit affordable housing complex located in Modesto, California; Strawberry Street Apartments, a 5-unit affordable apartment complex located in Visalia, California; Encina Apartments, a 6-unit affordable housing complex located in Visalia, California; Dinuba Manor, a 24-unit affordable housing complex located in Dinuba, California; Woodlake Townhomes, an 11-unit affordable apartment complex located in Woodlake, California; The Haven, a 24 unit affordable housing complex located in Bakersfield, California; Madison Place, a 56 unit affordable housing complex located in Bakersfield, California; and Mt. Whitney Apartments, a 29 residential unit and 4 commercial unit affordable housing complex located in Lindsay, California. As a limited liability company, the member’s liability is limited to its investment. SHC I will exist in perpetuity unless otherwise dissolved pursuant to the operating agreement.
Nueva Sierra Vista Associates is a partnership wholly-owned by Self-Help Enterprises. Nueva Sierra Vista Corporation, a wholly owned corporation, is the managing general partner, and SHE-CEF I, Inc., also a whollyowned corporation, is the limited partner. The partnership owns and operates Nueva Sierra Vista, a 35-unit affordable housing community in Richgrove, California.
Caliente Creek Partners is wholly owned by Self-Help Enterprises. SHE-CEF I, Inc. is the general partner and Almond Court, Inc. (“ACI’) is the limited partner. Caliente Creek Partners owns and operates a 46-unit affordable housing community in Arvin, California.
Casitas Del Sol Partners and Cottonwood Creek Partners are partnerships wholly-owned by Self-Help Enterprises. SHE-CEF I, Inc. is the general partner and Villa Santa Guadalupe Corp is the limited partner.
Casitas Del Sol Partners owns and operates a 36-unit affordable community in Livingston, California.
Cottonwood Creek Partners owns and operates a 40-unit affordable housing community in Madera, California.
Villa Santa Guadalupe Partners is a partnership wholly-owned by Self-Help Enterprises. The general partner is Villa Santa Guadalupe Corp and SHE-CEF I, Inc. is the limited partner. Villa Santa Guadalupe Partners owns and operates a 60-unit affordable housing community in Cutler, California.
Villa Hermosa Partners and Sunrise Villa Partners are partnerships wholly-owned by Self-Help Enterprises, SHE-CEF I, Inc. is the limited partner, and ACI, a corporation owned by Self-Help Enterprises, is the general partner. Villa Hermosa Partners owns and operates a 40-unit affordable housing community in Wasco, California. Sunrise Villa Partners owns and operates a 44-unit affordable housing community in Wasco, California.
Goshen Village Partners and Rolling Hills Partners are partnerships wholly-owned by Self-Help Enterprises.
ACI, is the limited partner, and SHE-CEF-1, Inc., is the general partner. Goshen Village Partners owns and operates a 64-unit affordable housing community in Goshen, California. Rolling Hills Partners owns and operates a 52-unit affordable housing community in Newman, California.
SHE-TSH LLC is wholly owned by Self-Help Enterprises. It is a 22-bed transition facility located in Visalia, CA.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
13 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Principles of Consolidation (Continued)
Sand Creek Partners, Villa Del Rey Partners, and Washington Plaza Partners are partnerships wholly-owned by Self-Help Enterprises. The general partner is SHE-CEF 1, Inc and ACI is the Limited Partner. Sand Creek Partners owns and operates a 60-unit affordable housing community in Orosi, California. Villa Del Rey Partners owns and operates a 48-unit affordable housing community in Del Rey, California. Washington Plaza Partners owns and operates a 44-unit affordable housing community in Earlimart, California.
Personal Assets and Liabilities and Partners’/Members’ Salaries In accordance with the generally accepted method of presenting partnership and limited liability company financial statements in the United States of America, the consolidated financial statements do not include the personal assets and liabilities of the partners or members, including their obligation for income taxes on the distributive shares of net income of the Organization, nor any provision for income tax expense.
Guaranteed Payments to Partners/Members
Guaranteed payments to partners or members that are intended as compensation for services rendered are accounted for as expenses rather than as allocations of partnership or limited liability company net income.
Guaranteed payments that are intended as payments of interest on capital accounts are not accounted for as expense of the partnership or limited liability company, but rather as a part of the allocation of net income.
There were no guaranteed payments made during the years ended June 30, 2022 and 2021.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Revenue Recognition
Grant revenues are recognized when the related grant expenditure is incurred. Contract revenues are recognized as earned or when services are performed. All leases are classified as operating leases and are recognized on a straight-line basis over the terms or the related leases. Revenues from sales of homes are recognized when sales are closed and title passes to the new homeowner. Revenues from the sales of land are recognized when title passes and collectability of the receivable is reasonably assured.
The Organization has elected to recognize what was previously considered to be “grants” as contributions with conditions and retain the label of “grants” in these consolidated financial statements under FASB No. 2018-08 ASU. These are contributions with conditions that are required to be met in order to earn and recognize the associated revenue.
Contributions
Contributions received are measured at fair value and recorded as revenues or gains in the period received, or as assets, depending on the form of benefits received. Contributions received include not only unconditional receipts of cash or other assets, but also unconditional promises to make contributions. Contributions are reported as either with donor restrictions, or without donor restrictions, based on donor-imposed restrictions or conditions. Contributions with donor-imposed restrictions are reported as restricted support; however, if those donor restrictions are met in the same reporting period, the contributions are reported as without donor restrictions.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
14 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Cash and Equivalents
For the purpose of reporting in the statement of cash flows, the Organization considers all cash accounts and all highly liquid debt instruments purchased with an original maturity of twelve (12) months or less to be cash equivalents.
Grants and Accounts Receivable
The Organization utilizes the allowance method of accounting for reporting uncollectible or doubtful accounts.
Management determines the allowance for doubtful accounts based on an analysis of specific customers, taking into consideration the age of past due accounts and an assessment of the customer’s ability to pay. At June 30, 2022 and 2021, management considered all accounts to be fully collectible and, therefore, no allowance was recorded in the accompanying consolidated financial statements. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded as income when received. All accounts receivable are non-interest bearing. The Organization grants credit to its customers, substantially all of which are government agencies (federal, state, and local), and generally requires no collateral from its customers.
Notes Receivable and Allowance for Losses
Notes receivable are stated at unpaid principal balances, less an allowance for loan losses. Interest on loans is recognized over the term of the loan and is calculated using the simple-interest method on principal amounts outstanding. The allowance is increased by charges to income and decreased by charge-offs (net of recoveries). Management’s periodic evaluation of the adequacy of the allowance is based on adverse situations that may affect the borrower’s ability to repay and current economic conditions. Loans are placed on nonaccrual status when management believes that the loans are impaired or collection of interest is doubtful.
Interest income generally is not recognized on specific impaired loans unless the likelihood of further loss is remote. Interest income on impaired loans is recognized only to the extent of interest payments received. At June 30, 2022 and 2021, management has determined no allowance for losses is necessary.
Investments in Marketable Securities
Investments in marketable securities consist primarily of equity securities and are recorded at fair value. The fair values of equity securities are determined by closing prices on the last day of the fiscal year as published by the markets in which the securities are traded.
Fair Value
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. See Note 3 for a further discussion of assets measured at fair value.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
15 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Investments in Affiliates – At Cost
The Organization accounts for its investments in affiliates, in which the Organization is the general partner in various limited partnerships that may own and operate low-income housing projects using the cost method of accounting. The Organization has determined the cost method is appropriate as the general partner only has a
0.01% interest in the underlying limited partnerships and each of the limited partnerships has an administrative limited partner who oversees the management of that limited partnership including: establishing the compensation of the general partner, oversight and approval of the budgeting process, and approval of any additional debt and reserve expenditures. These substantive participating rights of the administrative limited partner effectively removes the Organization from ‘control’ of the limited partnerships and eliminates the requirement under accounting principles generally accepted in the United States of America to consolidate the limited partnerships.
Entities accounted for as affiliates under the cost method of accounting, and their underlying limited partnerships and related projects, as of June 30, 2022 are:
Affiliates Projects and Limited Partnerships
SHE-CEF I, Inc. Villa Del Rey Partners; Biola Village Partners; Lincoln Plaza, LP; Rancho Lindo Partners, A CA LP; and Parksdale Village; Washington Plaza Partners; Sand Creek Partners
Annadale Commons, LLC Annadale Commons, LP
Butterfly Gardens Butterfly Gardens LP
Creekside Terrace LLC Creekside Terrace LP
Highland Gardens, LLC Highland Gardens, LP
Goshen Village II, LLC Goshen Village Partners II, A CA LP Mariposa Oaks, LLC Mariposa Oaks, LP
Nupchi Xo'oy, LLC Nupchi Xo'oy, LP
Palm Terrace, LLC Palm Terrace, LP, LP
Parksdale Village II, LLC Parksdale Village Partners II, LP Sequoia Commons, LLC Sequoia Commons, LP
Sequoia Commons II LLC Sequoia Commons II LP
Sierra Village GP, LLC Sierra Village, LP
Solinas/Almond, LLC Solinas/Almond, LP
Stonegate Village I, LLC Stonegate Village I, LP
Stonegate Village II, LLC Stonegate Village II, LP
Sugar Pine Village, LLC Sugar Pine Village, LP
Valley Oaks, LLC Valley Oaks Apartments, LP
Viscaya Gardens, LLC Viscaya Gardens Partners
Investments in Affiliates – At Fair Value
The Organization has elected to apply the guidance found in FASB Section 958-325-35, an accounting alternative available to nonprofits. This section allows certain nonprofits to account for its investment in limited partnerships in which it is the general partner with a minority interest at fair value, instead of consolidation. The fair value option requires that such an election be made for each investment within the reporting group at date of acquisition. Fair value of the investments in affiliates is measured and adjusted each year. See Note 3 for further discussion of fair value measurements.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
16 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Impound/Reserve Accounts
Impound accounts include cash that is held on deposit by various trustees or financial institutions as specified by the terms of various loan agreements. The cash held in these accounts is to be used for real estate taxes and insurance premiums pertaining to the property that collateralizes the loan payable. Reserve accounts consist of cash held in a replacement reserve set aside for future repairs and maintenance of the specified property and tenant rental security deposits.
Construction-in-Progress
Construction-in-progress includes new homes and multifamily housing construction costs, which are stated at the lower of capitalized costs or net realizable value. Capitalized costs include property, taxes, interest, and insurance incurred during construction, and direct and certain indirect project costs. Indirect project costs are generally allocated using the relative sales value method. Construction-in-progress is considered current as these projects are expected to be completed in the subsequent year.
Land Held for Development
Land held for development includes inventories of land which are stated at the lower of capitalized costs or net realizable value and has been reduced by allowance for impairment. The allowance for impairment at June 30, 2022 and 2021 was $836,000 and $970,400. Capitalized costs include acquisition costs, property taxes, interest, insurance, and subdivision improvements incurred during development.
Plant, Property and Equipment
Plant, property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed by using the straight-line method ratably over the estimated useful life of the asset. The Organization capitalizes property and equipment when the individual cost exceeds $5,000. Construction-in-progress is not depreciated until the project is completed and the related asset has been placed in service. Costs of planned major maintenance activities are expensed as incurred. Estimated useful lives vary within the following ranges:
Years
Buildings and improvements 10-40
Equipment 3-7
Long-Lived Assets
Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset, and long-lived assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell.
Deferred Income
Deferred income represents management fees not yet recognized, revolving loan funds in which the Organization has been named beneficiary (see Note 6), and refundable advances. Refundable advances represent grant funds received but not yet spent. Should the grant funds not be spent in accordance with the grant agreement, the funds are required to be remitted back to the grantor.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
17 NOTE 1 – NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Income Taxes
Self-Help Enterprises is a tax-exempt corporation under section 501(c)(3) of the Internal Revenue Code and section 23701(d) of the State of California Corporations Code. The Organization is subject to taxation on any unrelated business income.
The Organization’s wholly-owned subsidiaries were organized as either a tax-exempt corporation, partnership, limited liability company or, in two cases, as a taxable corporation. The accompanying consolidated financial statements do not include a provision for federal or state income tax expense or benefit arising from net income or loss reported in the accompanying consolidated statements of activities attributable to these wholly-owned subsidiaries. In accordance with the generally accepted method of presenting partnership and limited liability company financial statements in the United States of America, such income or loss is includable in the taxable income or loss of the respective partner(s)/members(s). Limited liability companies are subject to a California gross receipts fee and limited partnerships are subject to a California minimum franchise fee of $800.
Uncertain Tax Positions
Generally accepted accounting principles provide accounting and disclosures guidance about positions taken by an entity in its tax returns that might be uncertain. Management has considered its tax positions and believes that all of the positions taken in its federal and state exempt organization and other tax returns are more likely than not to be sustained upon examination. The Organization’s returns are subject to examination by federal and state taxing authorities, generally for three years and four years, respectively, after they are filed.
Allocation of Expenses
The costs of providing the Organization’s programs and supporting services have been summarized on a functional basis in the accompanying consolidated statements of activities and functional expenses. All Indirect or shared costs are allocated among program, support services, and fundraising based on hours worked.
Accordingly, certain costs have been allocated to program and supporting services and fundraising.
Fundraising Activities
Fundraising expenses included in the accompanying consolidated statement of activities for the years ended June 30, 2022 and 2021 totaled $11,620 and $11,302, respectively. Costs of acquiring or applying for a contract grant are categorized as administrative expenses and not separately stated as fundraising expenses.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
18 NOTE 2 – NOTES RECEIVABLE
Notes receivable consisted of the following at June 30:
2022 2021
Related Parties:
Staff computer, tool, and other loans; non-interest bearing, principal repayments deducted from semi-monthly paychecks; uncollateralized. $ 5,011 $ 3,361
Annadale Commons, LP (.01% general partner): sponsor loan in the amount of $479,068, bearing simple interest at 3% and due in 2076. 479,068 479,068
Annadale Commons, LP (.01% general partner) sponsor loan, interest at 3%, due December 31, 2074. 200,000 200,000
Creekside Terrace LP (.01% general partner) dated April 1, 2021. Cash flow loan at 3% interest, due April 1, 2024. 200,000 200,000 Creekside Terrace LP (.01% general partner) dated April 20, 2021. Sponsor loan in the amount of $595,441 at 7% interest and is due December 31, 2077. 595,441 595,441
Highland Garden L.P (.01% general partner): loan due
December 31, 2072, 3% simple interest, uncollateralized. 816,741 816,741 Lofts at Fort Visalia (.01% general partner) loan due February 1, 2025, zero interest, uncollateralized. 150,000 -
Los Arroyos II (.01% general partner) loan due May 1, 2025 at zero interest, uncollateralized. 150,000 -
Mariposa Oaks LP (.01% general partner) loan due April 30, 2022 at zero interest. 20,000 20,000
Nupchi Xo'oy LP (.01% general partner) sponsor loan due December 31, 2076 at 3% interest. 150,000 150,000
Nupchi Xo'oy LP (.01% general partner); Principal due
December 1, 2021 at zero interest. 200,000 -
Nupchi Xo'oy LP (.01% general partner); temporary cash flow loan in the amount of $500,000 dated July 17, 2020. Principal due December 1, 2021 at zero interest. 200,000 -
Palm Terrace LP, L.P. (.01% general partner: sponsor loan in the amount of $696,016, at zero interest and due in December 2074. 396,016 396,016
Palm Terrace LP, LP (.01% interest general partner loan in the amount of $155,000, at zero interest and due in December 2075. 155,000 155,000
Palm Terrace II LP (.01% general partner); Principal due February 1, 2024 at 0% interest. Note is uncollateralized. 150,000 - Santa Fe Commons I (.01% general partner); Principal due February 1, 2024 at 0% interest. Note is uncollateralized. 200,000 - Sequoia Commons, LP (.01% general partner): cash flow loan in the amount of $20,000, zero interest loan, due August 19, 2022. 20,000 -
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
19 NOTE 2 – NOTES RECEIVABLE (Continued)
2022 2021
Related Parties: (Continued)
Sequoia Commons, LP (.01% general partner): development loan in the amount of $145,000 collateralized by the property, interest at 3.31%. Note is due on December 1, 2075. $ 145,000 $ 145,000 Sequoia Commons, LP (.01% general partner): sponsor loan in the amount of $1,105,776 collateralized by the property, at zero interest. Note is due on December 1, 2075. 1,105,776 1,105,776 Sequoia Commons, LP (.01% general partner): loan from San Joaquin Valley Air Pollution Control District funds granted to SHE in the amount of $391,958, dated December 1, 2018,
funded in July 2020 and collateralized by the property. Loan from SHE is at zero interest. Note is due on December 31, 2075. 391,958 391,958
Sequoia Commons II, LP (.01% general partner): sponsor loan in the amount of $1,701,410 collateralized by the property, at zero interest, not all loan amount has been withdrawn. Note is due in October 2077. 1,701,410 1,531,269
Sequoia Commons II, LP (.01% general partner): development loan in the amount of $400,000, zero interest loan with a maturity date of October 1,2022. 400,000 -
Sierra Village, LP (.01% general partner): development loan at zero interest in amount of $430,000 and due December 1, 2072. Note is collateralized by the property. 430,000 430,000 Sierra Village II, LP (.01% general partner): Principal due November 1, 2023 at 0% interest. Note is uncollateralized. 200,000 - Sierra Village II, LP (.01% general partner): A sponsor loan in the amount of $1,173,227, bearing interest at 0% and
collateralized by the property. Due December 31, 2078. 1,173,227 - Solinas/Almond, LP (.01% general partner): sponsor loan in the amount of $628,656, bearing interest at 5% and a maturity date of December 31, 2072. The note is collateralized by the property and was for purchase of photo-voltaic system. 493,943 493,943 Stonegate Village I, LLC (.01% general partner) principal in the amount of $400,000 at 2% interest due November 1, 2021. 400,000 - Stonegate Village I, LLC (.01% general partner) loan in amount of $492,489 at zero interest and due December 31, 2076. 189,537 492,489 Stonegate Village II (.01% general partner) principal in the amount of $350,000 at 2% interest due June 2, 2022. 350,000 - Stonegate Village I LP (.01% general partner) sponsor loan dated November 14, 2019 and funded June 1, 2021 in the
amount of $390,233 at zero interest and collateralized by the property due December 31, 2076. 390,233 390,233
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
20 NOTE 2 – NOTES RECEIVABLE (Continued)
2022 2021
Related Parties: (Continued)
Stonegate Village I LP (.01% general partner) sponsor loan dated November 14, 2019 and funded September 23, 2021 in the amount of $1,100,000 at zero interest and collateralized by the property due December 31, 2076. $ 1,100,000 $ -
Stonegate Village II (.01% general partner) temporary cash flow loan in the amount of $100,000 at zero interest and due September 16, 2021. 100,000 -
Sugar Pine (.01% general partner) temporary cash flow loan dated August 1, 2020 in the amount of $250,000. Bears 2% interest and is due August 1, 2022. The note is unsecured. 250,000 250,000 Valley Oaks Apartments (.01% general partner) sponsor loan in the amount of $134,655 at 5% interest and due March 1, 2077. 134,655 134,655 Valley Oaks Apartments (.01% general partner) loan in the amount of $250,000 at zero interest and due November 22, 2021. 15,000 250,000
Non-Related Parties:
Revolving loan programs; various notes to eligible participants; interest and non-interest bearing (ranging from 0% to 3.5%); to be repaid in full over terms ranging from 30 to 50 years, or upon transfer of the property; collateralized by deeds of trust. 16,160,755 15,232,400 Note Receivable from Housing Assistance Council (CDFI) at $650,000 dated June 30, 2021 at interest rate of 2%, Not collateralized and due June 30, 2023. 650,000 650,000
Note Receivable from Rural Community Assistance
Corporation (CDFI) at $1,250,000 dated June 7, 2021 at
interest rate of 2.5%, Not collateralized and due June 7, 2024. 1,250,000 1,250,000 Household Water Well System Loans; various 20-year notes, interest payable monthly at 1%, due through August 2028; collateralized by deeds of trust. 6,058,736 6,804,185
Community Development Loan Fund; varying interest rates and terms. 21,096 55,401
35,548,603 34,272,936
Less current portion (2,067,316) (1,730,943)
Total $ 33,481,287 $ 32,541,993
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
21 NOTE 3 – FAIR VALUE MEASUREMENTS
The Organization’s investments are reported at fair value in the accompanying consolidated statements of financial position. The methods used to measure fair value may produce an amount that may not be indicative of the net realizable value or reflective of future fair values. Furthermore, although the Organization believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
The fair value measurement accounting literature establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels: Level 1 inputs consist of unadjusted quoted prices in active markets for identical assets and have the highest priority; Level 2 inputs which are inputs other than quoted prices that are observable; and Level 3 inputs which have the lowest priority. The Organization uses appropriate valuation techniques based on the available inputs to measure the fair value of its investments. When available, the Organization measures fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value.
Level 1 - Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Organization has the ability to access.
Level 2 - Inputs to the valuation methodology include:
Quoted market prices for similar assets or liabilities in active markets; Quoted prices for identical or similar assets or liabilities in inactive markets; Inputs other than quoted prices that are observable for the asset or liability; Inputs that are derived principally from or corroborated by observable market data by correlation or other means.
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at June 30, 2022 and 2021.
Fair Value Measurements
Level 1 - The fair value of mutual funds and common stocks is based on the closing price reported on the active market where the individual securities are traded.
Level 2 - The fair value of certificates of deposit with original maturities of greater than twelve (12) months is based on amortized cost, plus accrued interest.
Level 3 - The fair value of investments in affiliates is based on a discounted cash flow method.
A multi-year cash flow projection was prepared with the following significant assumptions:
Estimated cash inflows to the general partner;
Estimated cash outflows to the limited partner;
Assignment of the limited partner’s interest after the 15th year of ownership; Upon exit of the limited partner, remaining cash inflows to the general partner based on a 40-year depreciable life of the underlying asset; Estimated annual appreciation in the underlying value of the asset of 1%; Estimated proceeds from sale of the underlying asset at the end of the restricted use period;
Discount factor of 10% as of June 30, 2022.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
22 NOTE 3 – FAIR VALUE MEASUREMENTS (Continued)
The following table sets forth by level, within the fair value hierarchy, the Organization’s investments in marketable securities at fair value as of June 30, 2022:
Level 1 Level 2 Level 3 Total
Mutual funds $ 213,795 $ - $ 213,795 - $
Certificates of deposit 1,933,036 - 1,933,036 -
Investments in affiliates at fair value - - 81,109 81,109 213,795 1,933,036 81,109 2,227,940
Common stock:
Communications 249,987 - - 249,987
Consumer goods 418,797 - - 418,797
Energy 205,292 - - 205,292
Financial 659,657 - - 659,657
Healthcare 733,198 - - 733,198
Industrials 111,431 - - 111,431
Technology 338,048 - - 338,048
Materials 49,240 - - 49,240
Utilities 95,675 - - 95,675
Total common stock - 2,861,325 - 2,861,325
Total assets at fair value $ 3,075,120 $ 1,933,036 $ 81,109 $ 5,089,265 The following table sets forth by level, within the fair value hierarchy, the Organization’s investments in marketable securities at fair value as of June 30, 2021:
Level 1 Level 2 Level 3 Total
Mutual funds $ 238,477 $ - $ 238,477 - $
Certificates of deposit 2,081,369 - 2,081,369 -
Investments in affiliates - - 213,307 213,307
238,477 2,081,369 213,307 2,533,153
Common stock:
Communications 192,730 - - 192,730
Consumer goods 620,855 - - 620,855
Energy 176,539 - 176,539 -
Financial 835,752 - 835,752 -
Healthcare 552,521 - 552,521 -
Industrials 84,690 - 84,690 -
Real Estate 26,744 - 26,744 -
Technology 405,288 - 405,288 -
Materials 33,223 - 33,223 -
Utilities - 104,820 - 104,820
Total common stock - 3,033,162 - 3,033,162
Total assets at fair value $ 3,271,639 $ 2,081,369 $ 213,307 $ 5,566,315
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
23 NOTE 3 – FAIR VALUE MEASUREMENTS (Continued)
The Organization’s policy is to recognize transfers into and out of Levels 2 and 3 as of the date of the event or change in circumstances that caused the transfer. For the years ended June 30, 2022 and 2021, there were transfers of $132,198 and $91,332, respectively, into Level 3.
Following is a reconciliation of Level 3 activity:
Balance, June 30, 2021 $ 213,307
Transfers out of Level 3 (132,198)
Unrealized gain/(loss) -
Balance, June 30, 2022 $ 81,109
NOTE 4 – INVESTMENTS IN AFFILIATES
Investments in affiliates – at cost consisted of the following at June 30:
2022 2021
Annadale Commons, LLC $ 378,567 $ 378,567
Butterfly Gardens 250 250
Creekside Terrace, LLC 100 100
Finca Serena 30 -
Goshen Village II, LLC 208,800 208,800
Lofts @ Fort Visalia 10 -
Los Arroyos II 100 -
Mariposa Oaks LLC 1,418 1,418
Nupchi Xo'oy, LLC 100 100
Palm Terrace, LLC 11,239 11,239
Palm Terrace II, LLC 1,000 -
Parksdale Village II, LLC 113,201 113,201
Santa Fe Commons I 100 -
Sequoia Commons, LLC 1,000 1,000
Sequoia Commons II, LLC 150,000 150,000
SHE-CEF I, Inc. 817,492 817,492
Sierra Village GP, LLC 100 100
Sierra Village II 100 -
Solinas/Almond Partners, LLC 187,100 187,100
Stonegate Village I, LLC 100 100
Stonegate Village II, LLC 100 100
Sugar Pine Village, LLC 1,272,954 632,365
Valley Oaks, LLC 1,000 1,000
Viscaya Gardens, LLC 360 360
Total 3,145,221 $ $ 2,503,292
Investments in affiliates – at fair value consisted of the following at June 30:
2022 2021
Sand Creek $ 57,230 - $
Washington Plaza 73,115 -
Highland Gardens 81,109 82,962
Total $ 81,109 $ 213,307
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
24 NOTE 4 – INVESTMENTS IN AFFILIATES (Continued)
Summarized financial information for the investments in affiliates reported at fair value as of June 30 consisted of the following:
2022 2021
Total assets $ 7,020,432 $ 18,639,710
Total liabilities 3,899,995 11,237,420
Partners' equity/(deficit) $ 3,120,437 $ 7,402,290
Total revenues 326,159 $ $ 1,176,920
Total expenses 771,788 2,640,219
Increase/(decrease) in net assets $ (445,629) $ (1,463,299) NOTE 5 – PLANT, PROPERTY AND EQUIPMENT
Plant, property and equipment consisted of the following at June 30:
2022 2021
Land $ 7,689,837 $ 5,027,843
Buildings and improvements 111,439,621 76,386,035
Equipment 1,965,209 1,458,778
Total plant, property and equipment 121,094,667 82,872,656 Less accumulated depreciation (71,520,244) (49,876,002) Total plant, property and equipment, net $ 49,574,423 $ 32,996,654 Net plant, property and equipment are labeled under the following categories (used for internal managerial purposes only) at June 30:
2022 2021
Administrative $ 2,777,288 $ 2,142,517
Multifamily 46,797,135 30,854,137
$ 49,574,423 $ 32,996,654
Included in plant, property and equipment are apartment buildings leased to others under operating leases generally not exceeding one (1) year. Total cost of leased property at June 30, 2022 and 2021 was $116,063,624 and $78,628,031 respectively; accumulated depreciation was $69,102,303 and $47,773,894, respectively. Depreciation expense for the years ended June 30, 2022 and 2021 was $3,596,880 and $2,418,410, respectively.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
25 NOTE 6 – REVOLVING LOAN PROGRAMS
The Organization’s revolving loan fund is used primarily to assist participants in the Organization’s homeownership programs by making short-term installment loans and long-term deferred loans to eligible homebuyers/homeowners. The purposes of these loans include short-term, no interest or low-interest financing for construction costs which exceed available loan amounts, direct mortgage assistance, and seller financing for building lots. The funds are derived from various state grant programs (CalHOME and HOME), NeighborWorks America, and other private Organization resources. Loans are collateralized against the real estate, and most are due and payable upon sale of the property by the homebuyer. Loans made under CalHOME, HOME, and other various state programs where the Organization is the beneficiary are accounted for by recording deferred revenue. On these loans, revenue is recognized as payments are received on the outstanding balances.
Deferred loans have also been utilized to fund replacement water wells in the San Joaquin Valley to assist participants whose wells have gone dry due to the extended drought in the State of California. The funds from various sources include grants and loans. Some of these loans are deferred and some require monthly payments at very low or no interest. The water well loans that are deferred are included in the deferred loan total in the Revolving Loan Fund.
Deferred loans at June 30, 2022 and 2021 consisted of revolving loans in the amount of $20,918,125 and $20,202,737 respectively, and are recorded as noncurrent liability in the accompanying consolidated statements of net position.
NOTE 7 – DEFERRED GRANT REVENUE
Deferred grant revenue consists of funding received from the following agencies in advance. As these grant requirements are met, the grant revenue is recognized. Deferred grant revenue consisted of the following at June 30:
2022 2021
Bank of the West $ 10,000 $ 10,000
California Endowment Fund 123,309 -
California State Water Resources Control Board 3,094,504 4,403,020 Capital Magnet Fund (CDFI) 1,514,500 1,529,000
Central Valley Community Foundation 18,225 -
Emerald Cities Collaborative 58,783
Energy Foundation 21,804 14,981
FB Heron Foundation 58,111 95,042
The Greenlining Institute 2,374 -
Housing Assistance Council 283,500 81,000
Kings/Tulare Homeless Alliance 205,000 -
NeighborWorks America 21,908 42,483
San Joaquin Valley Health Foundation 56,799 -
Sierra Health Foundation 64,012 -
State of CA Dept. of Housing & Community Development - HOME 67,624 58,550 Unidos US 65,211 59,875
United States Dept. of Agriculture - Rural Development 523 TA 52,152 175,588 United States Dept of Housing and Urban Development - CDBG Funds 8,874 174,152 Valley Children's Hospital 1,502 1,502
Water Foundation 58,666 66,266
Total deferred grant revenue 5,711,834 $ $ 6,786,483
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
26 NOTE 8 – FINANCING RECEIVABLES
The majority of the Organization’s financing receivables consists of loans to participants in the Organization’s home-ownership programs. At June 30, 2022 and 2021, these notes receivable represented approximately 28% and 33% of total assets, respectively.
Balances of financing receivables at June 30, 2022 are presented as follows:
Participant Loans Other Loans Affiliate Loans
Receivable Receivable Receivable Total
Ending balance 6/30/22 $ 22,219,491 $ 1,926,107 $ 11,403,005 $ 35,548,603 Ending balance individually evaluated for impairment $ - $ - $ - $ - Ending balance collectively evaluated for impairment $ 22,219,491 $ 1,926,107 $ 11,403,005 $ 35,548,603 Balances of financing receivables at June 30, 2021 are presented as follows:
Participant Loans Other Loans Affiliate Loans
Receivable Receivable Receivable Total
Ending balance 6/30/21 $ 22,041,584 $ 1,958,763 $ 10,272,589 $ 34,272,936 Ending balance individually evaluated for impairment $ - $ - $ - $ - Ending balance collectively evaluated for impairment $ 22,041,584 $ 1,958,763 $ 10,272,589 $ 34,272,936 For each class of financing receivables, the following table presents the recorded investment by credit quality indicator as of June 30, 2022:
Participant Loans Other Loans Affiliate Loans
Receivable Receivable Receivable
In payment status, current $ 743,543 $ 26,107 $ -
In payment status, paying but behind 98,308 - -
In payment status, not paying 50,388 - -
Not yet in payment status 21,327,252 1,900,000 11,403,005 Total property originated and serviced $ 22,219,491 $ 1,926,107 $ 11,403,005 For each class of financing receivables, the following table presents the recorded investment by credit quality indicator as of June 30, 2021:
Participant Loans Other Loans Affiliate Loans
Receivable Receivable Receivable
In payment status, current $ 1,149,247 $ 58,763 $ -
In payment status, paying but behind 37,723 - -
In payment status, not paying 68,085 - -
Not yet in payment status 20,786,529 1,900,000 10,272,589 Total property originated and serviced $ 22,041,584 $ 1,958,763 $ 10,272,589 For federal and state agency receivables, the credit quality indicator is whether the account is more than 90 days past due. For revolving loans, the credit quality indicator is performance determined by repayment status and delinquency status. Delinquency status is updated monthly by management.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
27 NOTE 8 – FINANCING RECEIVABLES (Continued)
Allowances for estimated losses are established based on prior collection experience and current economic factors which, in management’s judgment, could influence the ability of loan recipients to repay the amounts per the loan terms. Loan balances are written off only when they are deemed to be permanently uncollectible. The Organization determined the allowances for estimated losses on these financing receivables by looking at historical default rates and analyzing the aging of the past due loans. All nonperforming loans are included in the allowance for estimated losses. The Organization did not record an allowance for estimated losses on loans receivable for the years ended June 30, 2022 and 2021.
The aging of the financing receivables portfolio by class as of June 30, 2022 is presented as follows:
Total Investment >
30-59 Days 60-89 Days Greater Than Total Financing 90 Days and Past Due Past Due 90 Days Past Due Current Receivables Accruing Participant loans
receivable $ 98,308 - $ $ 50,388 $ 148,696 $ 22,070,795 $ 22,219,491 $ - Other loans
receivable - - - 1,926,107 - 1,926,107 -
Affiliate loans
receivable - - - - 11,403,005 - 11,403,005
$ 98,308 - $ $ 50,388 $ 148,696 $ 35,399,907 $ - 35,548,603 $ The aging of the financing receivables portfolio by class as of June 30, 2021 is presented as follows:
Total Investment >
30-59 Days 60-89 Days Greater Than Total Financing 90 Days and Past Due Past Due 90 Days Past Due Current Receivables Accruing Participant loans
receivable $ 37,723 - $ $ 68,085 $ 105,808 $ 21,935,776 $ 22,041,584 $ - Other loans
receivable - - - 1,958,763 - 1,958,763 -
Affiliate loans
receivable - - - - 10,272,589 - 10,272,589
$ 37,723 - $ $ 68,085 $ 105,808 $ 34,167,128 $ - 34,272,936 $ There was no impairment of financing receivables for the years ended June 30, 2022 and 2021.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
28 NOTE 9 – NOTES PAYABLE
Notes payable consisted of the following at June 30:
2022 2021
Note payable to Calvert Impact Capital, interest payable semi-annually at
4.0%, matured September 30, 2021, uncollateralized. $ 3,000,000 $ 2,000,000 Note payable to The California Endowment dated April 30, 2020 and bearing interest at 2%, Maturity date is April 30, 2025 and is uncollateralized. 3,000,000 3,000,000
Note payable to The Housing Partnership Network dated March 10, 2022 and bearing interest at 4.75%, paid quarterly. Maturity date is March 10, 2029 and it is uncollateralized. 3,000,000 -
Note payable to City of Turlock without interest. One-twentieth of the principal is payable upon the sale of each lot, up to a maximum of twentytwo lots, collateralized by deed of trust. 140,000 140,000 Note payable to Congregation of the Sisters of Charity of the Incarnate Word, interest payable annually at 2%, matures December 18, 2022, uncollateralized. 300,000 300,000
Note Payable to the City of Fresno dated September 17, 2018 in the amount of $31,500. The note bears no interest and becomes due when a home is built on the subject lot and sold to a low income buyer. 31,500 31,500 Note payable to Threshold Foundation, interest payable annually at 2%, matured December 12, 2021, uncollateralized. 45,000 45,000 Note payable to Wells Fargo Bank Subordinated loan dated December 5, 2018, interest to be paid quarterly at 2% per annum for the first four years of the loan. Effective on the fourth anniversary of the loan quarterly principal payments are required. Loan maturity date is December 5, 2024, and the loan is uncollateralized. 750,000 750,000
Note payable to the City of Visalia to finance various acquisition and construction costs for a five-lot project at NW 5th Street in the City of Visalia, no interest, balance is due upon the development and sale of properties to low to moderate income buyers acquired with the funds. The loan is collateralized by the property. 202,292 202,292 Note payable to the Rural Community Assistance Corporation, at 4.5% interest, dated May 7, 2019 in the amount of $3,376,000 for development of single family lots. Collateralized by a deed of trust to the property in the City of Reedley, California. Maturity date is June 1, 2024. 2,267,280 3,376,000 Note payable to the Rural Community Assistance Corporation, at 5% interest, dated May 20, 2021 in the amount of $820,000 for development of single family lots. Collateralized by a deed of trust to the property in the City of Chowchilla, California. Maturity date is June 1, 2024. Will be repaid as lots are sold. 820,000 820,000
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
29 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Note payable to the Rural Community Assistance Corporation, at 5.5% interest, dated July 15, 2019 in the amount of $1,622,700 for development of single family lots. Collateralized by a deed of trust to the property in the City of Shafter, California. Maturity date is August 1, 2023. $ 728,262 $ 582,713 Note payable to Central Valley Community Bank for single family lot development in Planada, California, in the amount of $2,128,000 and dated May 7, 2019. Bears interest at 5.25%, payable monthly; matures May 7, 2024, and collateralized by a deed of trust. 1,259,056 1,258,156 Note payable to Central Valley Community Bank for single family lot development in Orosi, California, in the amount of $1,477,000 and dated May 20, 2020. Bears interest at 4.25%, payable monthly; matures May 20, 2023, and collateralized by a deed of trust. Will be repaid as lots are sold. 967,532 790,739 Note payable to the FB Heron Foundation dated October 31, 2019, in the original amount of $1,000,000 bearing simple interest at 4% and a maturity date of October 31, 2029. the note is uncollateralized. 1,000,000 1,000,000 Note payable to the San Joaquin Valley Impact Investment Fund in the amount of $500,000, dated February 12, 2020, bearing interest at 2.25%, with a maturity date February 12, 2024. The note is not collateralized. 500,000 500,000 Note Payable to the Housing Assistance Council for development of single family lots in the City of Patterson. The note is dated April 26, 2018, is noninterest bearing and matures December 21, 2022. It is collateralized by the property. 210,000 -
Note Payable to the Housing Assistance Council for development of single family lots in Planada. The note is dated September 16, 2019, is noninterest bearing and matures June 30, 2023. It is collateralized by the property. 300,000 225,000
y g p g
family lots in Orosi. The note is dated June 25, 2021, is non-interest bearing and matures March 31, 2025. It is collateralized by the property.
Repaid as lots are sold. - 255,000
Note Payable to the Housing Assistance Council for development of single family lots in Orosi. The note is dated June 25, 2021, is non-interest bearing and matures March 31, 2025. It is collateralized by the property.
Repaid as lots are sold. - 105,000
Note Payable to California Housing Finance Agency for development of Accessory Dwelling Units. Bears interest at 1% and matures in February 19, 2034. 80,000 -
Note to the USDA-RD for development of Patterson single family homes.
Bears interest at 2.875%; matured in January 2022 and is collateralized by the property. 750,829 -
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
30 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Three mortgages payable to USDA-RD, collateralized by a first deed of trust on real property, monthly principal and interest installments of approximately $11,500 due, plus excess rent, if any. The monthly payment is applied to outstanding principal and interest, the excess rent, (if any) is applied to additional interest. Interest is accrued at 1%. The mortgages mature through 2039 (Bear Creek). $ 1,933,164 1,814,272 $
Mortgage payable to California Department of Housing and Community Development ("HCD"), collateralized by deed of trust on real property, bearing no interest. All payments deferred until the three related USDA-RD loans (see above) are paid in full. Beginning the first month following the first anniversary of the repayment of the USDA-RD loans, the Organization shall make annual principal payments to HCD until paid in full (Bear Creek). 447,480 447,480 Mortgage payable to HCD referred to as a "Joe Serna" loan, collateralized by deed of trust on real property, bearing deferred interest at 3%. All payments deferred until the USDA-RD loans are paid in full. At June 30, 2018 and 2017, unpaid deferred interest amounted to $780,000 and $761,396 respectively. Beginning the first of the month following the first anniversary of the repayment of the USDA-RD loans, the Organization shall make annual principal payments to HCD in an amount not less than annual residual receipts (as defined in the loan agreement), until paid in full. All unpaid interest and principal is due on March 15, 2060 (Bear Creek). 2,000,000 2,000,000 Mortgage note payable to the County of Kern in the original amount of $970,000 on March 26, 1999. The note bears interest at 3% per annum and is due March 26, 2054. Interest only is due to the extent of available net cash flow, as defined in the loan agreement. This note is collateralized by the property and by assignment of rents (Caliente Creek). 966,621 966,722 Note payable to the California Department of Housing and Community Development in the amount of $802,500. Interest at 3% is accrued. The note is collateralized by the property and due in August 2030 (Casitas del Sol). 800,854 801,020
Note payable to the California Housing Finance Agency in the amount of $108,457. The note bears no interest and is due August 2057.
Collateralized by the property (Casitas del Sol). 108,457 108,457 Mortgages payable to USDA-RD, collateralized by a first deed of trust on real property, combined monthly principal and interest installments of approximately $12,300 due, plus excess rent, if any. The monthly payment is applied to outstanding principal and interest; the excess rent (if any) is applied to additional interest. Interest is accrued at 1%. The mortgages mature on February 1, 2033 and January 1, 2025 (Casas de la Vina). 1,046,264 926,550
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
31 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Note payable to the County of Madera in the amount of $900,000 bearing interest at 3%. Matures November 2055 and the note is collateralized by the property (Cottonwood Creek). $ 900,000 900,000 $
Note payable to California Department of Housing & Community Development (HCD) in the original amount of $662,960 on May 3, 1993 The note is collateralized by the property and is due on May 3, 2048. The note bears simple interest at 3% and is deferred (Dinuba Manor). 656,204 656,443 Note Payable to the City of Visalia (CDBG Funds) dated August 23, 2019 in the amount of $400,000 at zero interest and a maturity date of August 23, 2039. (Eden House) 400,000 360,000
Note Payable to the City of Visalia (NSP Funds) dated August 23, 2019 in the amount of $225,000 at zero interest and a maturity date of August 23, 2039. (Eden House) 225,000 202,500
Note Payable to the City of Visalia (NSP Funds) dated May 14,2020 in the amount of $40,000 at zero interest and a maturity date of May 14, 2040. (Eden House) 36,000 37,018
Note payable to the City of Visalia HOME in the amount of $436,656 on May 29, 2018. The note is secured by the property, bears interest at 2% (simple) per annum and is due and payable on May 31, 2048. It is contemplated that payment of principal and interest be deferred, but payment of accrued interest to be made to the extent of surplus cash is available. (Encina Apts.) 436,656 436,656 Note payable to the City of Visalia in the amount of $100,000 dated May 29, 2018. The note bears zero interest, is collateralized by the property and is due May 31, 2073. It is contemplated that principal is deferred. (Encina Apts.) 100,000 100,000
Note payable to the City of Modesto (HOME program) in the original amount of $750,000, bears interest at 3% and matures in 2036. Interest is deferred until surplus cash is generated by the project. The loan is collateralized by the property (Gateway Village). 750,000 750,000
Note payable to the City of Modesto (Redevelopment program) in the original amount of $70,000, bears interest at 3% and matures in 2036.
Interest is deferred until surplus cash is generated by the project. The loan is collateralized by the property (Gateway Village). 70,000 70,000 Note payable to the California Department of Housing & Community Development (HCD/HOME) in the authorized amount of $1,071,600 dated April 18, 2002 and bearing simple interest at 3%. The maturity date is April 18, 2032 (Goshen Village). 1,071,600 1,071,600
Note payable to the Rural Community Assistance Corp.in the authorized amount of $945,726 dated June 10, 2022 and bearing compounded interest at 4.75%. The maturity date is July 1, 2038. (The Haven). 26,434 -
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
32 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Note payable to the Rural Community Assistance Corporation in the authorized amount of $1,957,567 on June 10, 2022. Bears compounded interest at 4.75%; matures July 31, 2038 and collateralized by the property. (Madison Place) $ - 269,085 $
Note payable to the City of Bakersfield in the amount of $280,000 assumed June 19, 2022 (originally made in 2009). Bears 0% interest, matures July 01, 2039 and collateralized by the property. (Madison Place) - 280,000 Note payable to the California Department of Housing and Community Development in the amount of $1,760,452 assumed March 25, 1996. Bears 3% simple interest, matures March 25, 2051 and collateralized by the property. (Mt. Whitney) 1,749,252 -
Note payable to the City of Lindsay in the amount of $250,000 assumed November 8, 1995. Bears 0% interest, due in 30 years and collateralized by the property. (Mt. Whitney) 250,000 -
Note payable to the Rural Community Assistance Corporation to develop a new community center in an original amount of $667,400. Bears interest at
4.25%; matures March 30, 2038 and collateralized by the property. (North Park) 604,988 644,843
Note payable to County of Tulare, collateralized by a deed of trust on real property, interest accruing at 7.27%, annual installments of $23,212, and matures on April 30, 2035. The original note has been amended to defer both interest and principal until April 30, 2025 (Nueva Sierra Vista). 284,155 284,155 Note payable to County of Tulare, collateralized by a deed of trust on real property, interest accruing at 7.27%, principal and interest payments deferred until April 30, 2035 (Nueva Sierra Vista). 275,210 275,210 Note payable to the State of California (RHCP) program. The note is collateralized by the property, bears interest at 3% per annum, and is due and payable on April 29, 2050. Payment of principal and interest is deferred but will be paid to the extent that surplus cash is generated by operations (Nueva Sierra Vista). 1,063,472 1,063,472
Note payable to the County of Tulare (CDBG) in the original amount of $850,875 on March 4, 2014. The note is collateralized by the property, is non-interest bearing, and is due and payable on March 4, 2054. It is contemplated that payment of principal and interest be deferred for 20 years with payments beginning in April 2034 (Nueva Sierra Vista). 850,875 850,875 Note payable to the California Department of Housing & Development (HCD) in the original amount of $991,500 dated October 24, 2003. Simple interest rate is 3%. Maturity date is October 24, 2033. (Rolling Hills) 955,831 976,446 Note Payable to USDA Rural Development in original amount of $1,800n750 on November 1, 2005 bearing interest at 1% and monthly payments of $5,710.51 beginning February 1, 2007. Loan is due February 1, 2040. The loan is collateralized by the property. (Sand Creek) 1,005,549 -
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
33 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Note payable to the California Department of Housing and Community Development in the original amount of $1,000,000 Joe Serna FWHG. The note bears simple interest of 3% and is due in October 2060. Collateralized by the property (Sand Creek). $ 1,000,000 $ -
Note payable to the California Department of Housing and Community Development in the original amount of $1,000,000 on October 31, 2005.
The note bears simple interest of 3% and is due in October 2060.
Collateralized by the property (Sand Creek). 1,000,000 - Notes payable to the City of Visalia in the amount of $429,150, bearing simple interest at 2% and maturing in 2046. Accrued interest is to be paid to the extent of surplus cash. The loans are collateralized by the property (Strawberry Street). 429,150 429,150
Note payable to the USDA-RD. The note bears interest at 1% and is payable in regular amortized installments of $894. The note is collateralized by the property and matures in May 2036 (Sunrise Villa). 139,612 149,531 Note payable to the County of Kern Development Program in the original principal of $1,000,000 on December 17, 2001. The note bears simple interest at 3% and is due on December 17, 2031. Interest of $539,287 has been accrued as of June 30, 2020. Interest is due to the extent of available net cash flow as defined in the loan agreement (Sunrise Villa). 999,060 998,995 Mortgage payable to USDA-RD, collateralized by a first deed of trust on real property, combined monthly principal and interest installments of approximately $7,770 due, plus excess rent, if any. The monthly payment is applied to outstanding principal and interest; the excess rent (if any) is applied to additional interest. Interest is accrued at 1%. The mortgage matures in June 2028 (Vera Cruz). 585,352 491,389
Mortgage payable to the County of Tulare in the amount of $630,200, uncollateralized, no interest. Monthly principal payments of approximately $2,600 are due beginning August 30, 2031, note matures August 2051 (Vera Cruz). 630,200 630,200
Mortgage note payable to the County of Kern in the original amount of $800,000 on March 12, 1999. The note bears interest at 3% per annum and is due March 26, 2054. Interest only is due to the extent of available net cash flow, as defined in the loan agreement. This note is collateralized by the property and by assignment of rents (Villa Hermosa). 797,945 798,193 Note payable to California Housing Finance Agency. Note does not bear interest and requires no principal payments until becoming due on March 16, 2056. This note is collateralized by the property (Villa Hermosa). 100,706 100,706
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
34 NOTE 9 – NOTES PAYABLE (Continued)
2022 2021
Note payable to the California Department of Housing and Community Development in the amount of $1,000,000. Interest at 3% is accrued. The note is collateralized by the property and due in August 2030 (Villa de Guadalupe). $ 1,000,000 $ 1,000,000
Note payable to the California Housing Finance Agency in the amount of $118,645. The note bears zero interest and is due in August 2056.
Collateralized by the property (Villa de Guadalupe). 118,645 118,645 Note Payable to USDA Rural Development in original amount of $1,003,500 on May 9, 2004 bearing interest at 1% and monthly payments of $3,066.33.
Loan is due June 1, 2038. The loan is collateralized by the property. (Villa Del Rey) 527,869 -
Note Payable to California Department of Housing and Community Development in original amount of $2,000,000 on October 27, 2004 bearing simple interest at 3%. Loan is due in 55 years. The loan is collateralized by the property. (Villa Del Rey) 2,000,000 -
Note Payable to County of Fresno in original amount of $700,000 on October 27, 2004 bearing simple interest at 3%. Loan is due in 30 years.
The loan is collateralized by the property. (Villa Del Rey) 700,000 - Note Payable to USDA Rural Development in original amount of $1,002,538 on November 1, 2005 bearing interest at 5.375% and monthly payments of $4,871.93. Loan is due February 1, 2040. The loan is collateralized by the property. (Washington Plaza ) 903,464 -
Note Payable to California Department of Housing and Community Development in original amount of $700,000 on October 28, 2005 bearing simple interest at 3%. Loan is due in 55 years. The loan is collateralized by the property. (Washington Plaza) 699,993 -
Note Payable to California Department of Housing and Community Development in original amount of $915,000 on October 31, 2005 bearing simple interest at 3%. Loan is due in 55 years. The loan is collateralized by the property. (Washington Plaza) 915,000 -
Mortgage payable to the City of Woodlake (HOME funds) in the original amount of $987,321 on November 1, 2017. The note is collateralized by the property and is due in 30 years on December 30, 2047. The note bears interest at 3% simple interest, deferred (Woodlake Townhomes). 987,321 987,321 51,454,075 37,824,393
Less current portion (2,014,442) (3,137,051)
$ 49,439,633 $ 34,687,342
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
35 NOTE 9 – NOTES PAYABLE (Continued)
Maturities of notes payable are as follows:
2023 $ 2,014,442
2024 6,274,140
2025 4,588,207
2026 3,421,341
2027 920,853
Thereafter 34,235,092
$ 51,454,075
Years Ending June 30:
A summary of the Organization’s notes payable as of June 30, 2022 is as follows:
Lending Institution Purpose Maturity Date Interest Rate Balance Calvert Impact Capital Development November 2026 4.15% 3,000,000 $ The California Endowment Development April 2025 2.00% 3,000,000 The Housing Partnership Network Development March 2029 4.75% 3,000,000 City of Turlock Development Upon sale 0.00% 140,000
Congregation of the Sisters of Charity Development December 2022 2.00% 300,000 City of Fresno Development Upon sale 0.00% 31,500
Threshold Foundation Development December 2024 2.00% 45,000 Wells Fargo Bank Development December 2024 2.00% 750,000 City of Visalia Development Upon sale 0.00% 202,292
Rural Community Assistance Corporation Development June 2024 4.50% 820,000 Rural Community Assistance Corporation Development June 2024 5.00% 2,267,280 Rural Community Assistance Corporation Development August 2023 5.50% 728,262 Central Valley Community Bank Development May 2024 5.25% 1,259,056 Central Valley Community Bank Development May 2023 4.25% 967,532 FB Heron Foundation Development October 2029 4.00% 1,000,000 San Joaquin Valley Impact Investment Fund Development February 2024 2.25% 500,000 Housing Assistance Council - SHOP Development June 2023 0.00% 300,000 Housing Assistance Council - SHOP Development March 2025 0.00% 255,000 Housing Assistance Council - HLP Development March 2025 0.00% 105,000 California Housing Finance Agency Development February 2034 1.00% 80,000 USDA - Rural Development Bear Creek 2023-2039 1.00% 1,814,272 Calif. Dept. of Housing & Comm. Develop. Bear Creek Upon Repayment 0.00% 447,480 Calif. Dept. of Housing & Comm. Develop. Bear Creek Upon Repayment 3.00% 2,000,000 County of Kern Caliente Creek March 2054 3.00% 966,722
Calif. Dept. of Housing & Comm. Develop. Casitas del Sol August 2030 3.00% 801,020 California Housing Finance Agency Casitas del Sol August 2057 0.00% 108,457 USDA - Rural Development Casas de la Vina 2033 and 2025 1.00% 926,550 County of Madera Cottonwood Creek November 2055 3.00% 900,000 Calif. Dept. of Housing & Comm. Develop. Dinuba Manor May 2048 3.00% 656,443 City of Visalia (CDBG/NSP) Eden House May 2040 0.00% 598,500 City of Visalia (HOME) Encina Apartments May 2048 2.00% 436,656
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
36 NOTE 9 – NOTES PAYABLE (Continued)
Lending Institution Purpose Maturity Date Interest Rate Balance City of Visalia Encina Apartments May 2073 0.00% 100,000 City of Modesto (HOME) Gateway Village 2036 3.00% 750,000 City of Modesto (RDA) Gateway Village 2036 3.00% 70,000 Calif. Dept. of Housing & Comm. Develop. Goshen Village April 2032 3.00% 1,071,600 Rural Community Assistance Corporation The Haven July 2038 4.75% 26,434 Rural Community Assistance Corporation Madison Place July 2038 4.75% 269,085 City of Bakersfield Madison Place July 2039 0.00% 280,000 Calif. Dept of Housing & Comm. Develop. Mt. Whitney March 2051 3.00% 1,749,252 City of Lindsay Mt. Whitney November 2025 0.00% 250,000 Rural Community Assistance Corporation North Park March 2038 4.25% 604,988 County of Tulare Nueva Sierra Vista April 2035 7.27% 559,365 State of California (RHCP) Nueva Sierra Vista April 2050 3.00% 1,063,472 County of Tulare (CDBG) Nueva Sierra Vista March 2054 0.00% 850,875 Calif. Dept. of Housing & Comm. Develop. Rolling Hills October 2033 3.00% 955,831 USDA - Rural Development Sand Creek February 2040 1.00% 1,005,549 Calif. Dept. of Housing & Comm. Develop. Sand Creek October 2060 3.00% 1,000,000 Calif. Dept. of Housing & Comm. Develop. Sand Creek October 2060 3.00% 1,000,000 City of Visalia Strawberry Street 2046 2.00% 429,150
USDA Rural Development Sunrise Villa May 2036 1.00% 139,612 County of Kern Sunrise Villa December 2031 3.00% 999,060 USDA - Rural Development Vera Cruz June 2028 1.00% 491,389 County of Tulare Vera Cruz August 2051 0.00% 630,200
County of Kern Villa Hermosa March 2054 3.00% 798,193
California Housing Finance Agency Villa Hermosa March 2056 0.00% 100,706 Calif. Dept. of Housing & Comm. Develop. Villa de Guadalupe August 2030 3.00% 1,000,000 California Housing Finance Agency Villa de Guadalupe August 2056 0.00% 118,645 USDA Rural Development Villa Del Rey June 2038 1.00% 527,869 Calif. Dept. of Housing & Comm. Develop. Villa Del Rey October 2059 3.00% 2,000,000 County of Fresno Villa Del Rey October 2034 3.00% 700,000 USDA Rural Development Washington Plaza February 2040 5.38% 903,464 Calif. Dept. of Housing & Comm. Develop. Washington Plaza October 2060 3.00% 699,993 Calif. Dept. of Housing & Comm. Develop. Washington Plaza October 2060 3.00% 915,000 City of Woodlake Woodlake Townhomes December 2047 3.00% 987,321 Total $ 51,454,075
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
37 NOTE 9 – NOTES PAYABLE (Continued)
Loan Forgiveness
Housing Assistance Council (HAC) will forgive up to 90% of each Self-Help Housing Opportunity Program (SHOP) loan to the Organization if the loan funds are used for SHOP-eligible purposes and for SHOP-eligible homebuyers within allowable timelines. For the years ended June 30, 2022 and 2021, $144,518 and $1,684,700, respectively, was recognized as earned loan forgiveness under this program in the consolidated statement of activities.
On April 11, 2020, the Organization received a Small Business Administration Paycheck Protection Program (SBA PPP) loan in the amount of $1,495,700. The SBA PPP is a federal loan program designed to assist entities in sustaining their operations during the COVID-19 pandemic, The loan is forgivable if used for eligible costs, including payroll costs, rent payments and others. Specific criteria must be met under the program guidelines for the loan to be forgiven. The full amount of the loan was forgiven in March 2021 and recognized as earned loan forgiveness in the consolidated statement of activities for the year ended June 30, 2021.
NOTE 10 – ACCRUED INTEREST
Accrued interest reported in the accompanying consolidated statement of financial position consisted of deferred interest for the following loans at June 30:
The entire amount of unpaid interest may become due and payable when the loans mature. 2022 2021
County of Tulare (Nueva Sierra Vista) $ 344,482 $ 320,824 County of Tulare (Nueva Sierra Vista) 542,375 528,367
State of California RCHP (Nueva Sierra Vista) 837,187 811,924 Calif. Dept. of Housing & Community Develop. (Bear Creek) 1,020,000 960,000 County of Kern (Caliente Creek) 666,782 637,682
County of Kern (Villa Hermosa) 553,797 529,797
City of Modesto HOME (Gateway Village) 580,857 558,357
City of Modesto RDA (Gateway Village) 54,846 52,746
City of Visalia (Strawberry Street) 60,086 51,503
Calif. Dept. of Housing & Community Develop. (Dinuba Manor) 547,965 528,076 City of Visalia-HOME (Encina Apts.) 34,932 26,199
Calif. Dept. of Housing & Community Develop. (Casitas del Sol) 493,661 470,736 Calif. Dept. of Housing & Community Develop. HCD/HOME(Goshen Village) 521,158 545,453 Calif. Dept. of Housing & Community Develop. (Mt. Whitney) 1,340,782 - Calif. Dept. of Housing & Community Develop. (Rolling Hills) 518,024 494,435 Calif. Dept. of Housing & Community Develop. (Sand Creek) 492,151 - Calif. Dept. of Housing & Community Develop. (Sand Creek) 477,679 - County of Madera (Cottonwood Creek) 568,315 541,315
County of Kern (Sunrise Villa) 599,287 569,287
Calif. Dept. of Housing & Community Develop. (Villa Del Rey) 1,042,994 - County of Fresno (Villa Del Rey) 279,193 -
City of Woodlake (Woodlake Townhomes) 138,226 108,605
Calif. Dept. of Housing & Community Develop. (Villa de Guadalupe) 592,286 563,512 Calif. Dept. of Housing & Community Develop. (Washington Plaza) 344,097 - Calif. Dept. of Housing & Community Develop. (Washington Plaza) - 442,708 Total accrued interest $ 13,093,870 $ 8,298,818
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
38 NOTE 11 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses reported in the accompanying consolidated financial position consisted of the following at June 30:
2022 2021
Accounts payable $ 3,022,642 $ 3,204,923
Interest payable 10,117 88,323
Accrued payroll 628,772 485,815
Accrued compensated absences 525,460 446,925
Tenant deposits 539,702 402,683
Other accrued expenses 626,112 221,311
Total accounts payable and accrued expenses $ 5,352,805 $ 4,849,980 NOTE 12 – REVENUE FROM CONTRACTS WITH CUSTOMERS
Revenue from performance obligations satisfied at a point in time consists of contract revenue, sales of land and homes, and developer fees. The total amount of revenue recognized from these contracts with customers during the years ended June 30, 2022 and 2021 was $20,633,461 and $14,035,821, respectively.
Contract assets include receivables arising from contracts from customers in the amount of $6,847,619, $6,352,637, and $5,125,456 at June 30, 2022, 2021, and 2020, respectively.
NOTE 13 – RETIREMENT PLAN
The Organization sponsors a discretionary employer defined contribution plan with 401(k) salary reduction provisions (the “Plan”). Under the Plan, the Board of Directors of the Organization determines, on an annual basis, the amount of the contribution that will be made to the Plan on behalf of its employees. The Organization’s contributions for the years ended June 30, 2022 and 2021 was 4% of salaries. In addition, employees can elect to defer a portion of their salary to contribute to the Plan. The Organization matches up to 4% of salary of the employee salary deferrals contributed to the Plan. All investments are self-directed by the employee through Minnesota Life. Salary deferrals by the employee for the years ended June 30, 2022 and 2021 were approximately $632,000 and $495,000, respectively. The Organization’s total contributions for the years ended June 30, 2022 and 2021 were approximately $616,900 and $800,000, respectively.
The Organization also offers an Internal Revenue Code Section 457(b) plan. The 457(b) plan allows management employees to voluntarily defer compensation to the extent allowed by law. No other contributions are made to the plan. The 457(b) plan assets as of June 30, 2022 was $13,892. The asset is included in the Restricted Cash on the consolidated balance sheet and the corresponding liability is included in accounts payable and accrued expenses.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
39 NOTE 14 – COMMITMENTS
Operating Leases
The Organization leases a postage meter and several copiers under operating lease agreements that expire in fiscal years 2023 and 2025. Aggregate future minimum rentals are approximately $24,000 for each of the remaining years. Lease expense for the years ended June 30, 2022 and 2021 totaled approximately $25,000 each year.
The Organization began a five-year lease of office space in the City of Madera to accommodate activities in the North Valley as of June 1, 2017. During the year ended June 30, 2022, the lease expired and was extended for another year at approximately $45,000.
Lines of Credit
The Organization has an operating line of credit with Wells Fargo Bank in the amount of $1,500,000 that bears interest at 4.5%. The maturity date is June 22, 2023. During the years ended June 30, 2022 and 2021, there were no advances drawn on the line of credit. There were no outstanding balances at June 30, 2022 and 2021.
An additional line of credit has been established with Merrill Lynch in the amount of $2,500,000. Any advances under this line of credit are covered by pledged assets from the investments held by Merrill Lynch. Interest rate is determined at the time of borrowing based on LIBOR. During the years ended June 30, 2022 and 2021, $2,500,000 and $750,000, respectively, was advanced from the line of credit. There were no outstanding balances at June 30, 2022 and 2021.
NOTE 15 – INDIRECT COST RATE
The Organization’s cognizant agency, the U.S. Department of Agriculture, contracts with the U.S. Department of the Interior for negotiation of the Indirect Cost Rate, which is applied to grants, contracts, and other agreements with the federal government to which OMB’s Uniform Guidance applies. The provisional rate approved for the years ended June 30, 2022 and 2021 was 20.21% and 21.97%, respectively. The actual rate applied for the years ended June 2022 and 2021 and reported in the accompanying consolidated statements was 22.76% and
20.62%, respectively. Indirect costs reported in the accompanying consolidated statements of activities amounted to $2,248,547 and $1,833,422 for the years ended June 30, 2022 and 2021, respectively.
NOTE 16 – CONTINGENCIES AND CONCENTRATIONS
Federal Grants
The Organization participates in a number of federal programs that are funded by grants received from various government funding agencies. Expenditures financed by grants are subject to audit by the appropriate grantor government. Periodic audits may be performed by these granting agencies and certain costs may be questioned as not being reimbursable under the terms of the contract. If expenditures are disallowed due to noncompliance with grant program regulations, the Organization may be required to reimburse the grantor government. At June 30, 2022, significant amounts of grant expenditures have not been audited but the Organization’s management believes that disallowed expenditures discovered in subsequent audits, if any, will not have a material effect on its overall financial position.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
40 NOTE 16 – CONTINGENCIES AND CONCENTRATIONS (Continued) Economic Dependency
The Organization receives a majority of its funding through various federal programs and contracts with local and state agencies. Unrestricted grants for the years ended June 30, 2022 and 2021 comprise approximately
43.7% and 36.4% of total unrestricted revenue, respectively.
The following is a summary of the percentage of total grants received from each of the agencies for the year ended June 30, 2022:
Funding Agency Amount Percentage
State Water Resources Control Board $ 19,120,425 80.52% United States Department of Agriculture - Rural Development 2,408,292 10.14% California Dept. of Housing & Community Development 1,004,900 4.23% All Others 858,539 3.62%
United States Dept of Housing and Urban Development 310,983 1.31% United States Treasury Appropriations - NeighborWorks 26,575 0.11% Community Development Financial Institutions - Capital Magnet Fund 14,500 0.06% California Office of Emergency Services 1,577 0.01%
Total funding recognized $ 23,745,791 100%
The following is a summary of the percentage of total grants received from each of the agencies for the year ended June 30, 2021:
Funding Agency Amount Percentage
State Water Resources Control Board $ 7,737,049 54.17%
Dept. of Housing & Community Dev. - Affordable Housing and Sustainable Communities 2,652,567 18.57% United States Department of Agriculture - Rural Development 2,291,273 16.04% All Others 829,299 5.81%
California Office of Emergency Services 522,763 3.66%
United States Dept of Housing and Urban Development 79,455 0.56% United States Treasury Appropriations - NeighborWorks 71,484 0.50% United States Dept. of Labor 58,104 0.41%
California Department of Water Resources 23,057 0.16%
Community Development Financial Institutions - Capital Magnet Fund 17,514 0.12% Total funding recognized $ 14,282,565 100%
Credit Risk – Cash Balances and Investments
The Organization maintains cash balances in several financial institutions, including Wells Fargo Bank and Citibank. Non-interest-bearing accounts are aggregated with interest bearing accounts and are insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC). Uninsured cash balances at June 30, 2022 and 2021 amounted to approximately $11,200,000 and $5,500,000, respectively.
Additional funds in the amount of approximately $1,690,134 are held at Merrill Lynch in a program of laddered certificates of deposit through which investments are made at a series of banks in balances less than $250,000 each. These funds are covered under FDIC insurance.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
41 NOTE 16 – CONTINGENCIES AND CONCENTRATIONS (Continued) Credit Risk – Cash Balances and Investments
The Organization does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships due to the credit-worthiness of the related financial institutions.
Liquidity
The following represents the Organization’s financial assets at June 30:
2022 2021
Cash and cash equivalents $ 10,913,918 $ 6,260,862
Accounts receivable 7,504,080 5,701,939
Investments 5,008,156 5,353,008
Current portion of notes receivable 2,163,004 1,823,111 Total financial assets as of December 31 25,589,158 19,138,920 Less amounts not available to be used within one year:
Donor-imposed restrictions: (3,808,230) (3,946,257)
Financial assets available to meet cash needs for
general expenditures within one year $ 21,780,928 $ 15,192,663 The Organization has a policy that it must maintain a cash balance available to cover six-months of operating expenses. This balance is reviewed quarterly by the Finance/Audit Committee.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
42 NOTE 16 – CONTINGENCIES AND CONCENTRATIONS (Continued) Guarantees
The Organization has guaranteed results of operations as of June 30, 2022, as follows:
Operating Deficit Guarantee Operating Deficit Reserve
Solinas/Almond,
Kern County CA
$248,635 for 48 months after
stabilization in January 2018 Fully funded at December 2018 Expires as of 12/31/22 Palm Terrace,
Lindsay CA
$135,350 for 60 months after
stabilized occupancy in March
2019
Funded at $75,239 at 12/31/20 Expires as of 3/31/24
Sequoia Commons,
Goshen CA
$150,000 for 48 months after
stabilized occupancy in May
2020
Funded in full at conversion to
permanent funding
Expires as of May 2024 unless
Debt Service Coverage Ratio
requirements are not met for five
(5) consecutive months
Mariposa Oaks,
Mariposa CA
$180,000 for 60 months after
stabilized occupancy in
October 2020
The operating reserve of $97,487
was funded at permanent
conversion; there is also a USDA
reserve of $185,544, so the project
has funds on account for this full
obligation.
Expires as of 12/1/25
Valley Oaks,
Oakhurst, CA
$200,000 for 60 months after
stabilized occupancy in January
2021
The operating reserve of $49,733
was funded at permanent
conversion.
Expires as of 1/31/2026
Nupchi Xo'oy
$170,000 for 60 months after
project completion in June
2021
Funded at $173,039 at 3/01/22 Expires as of 6/01/2027
Stonegate Village I $225,000 for 36 months after
December 1, 2020 Funded at $98,419 at 11/01/21 Expires as of 12/01/2023 Stonegate Village II $300,000 for 36 months after
September 1, 2021 Funded at $137,825 at 12/08/21 Expires as of 9/01/2024 Annadale Commons $110,000 for 36 months after
July 1, 2020 Funded at $53,885 at 4/01/21 Expires as of 7/01/2023
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
43 NOTE 17 – NET ASSETS WITH DONOR RESTRICTIONS
The Organization considers donations to the Do Dooley Scholarship Fund as donor restricted net assets. This Fund provides scholarships to program participant family members. The net assets with donor restrictions in this fund at June 30, 2022 and 2021 were $192,208 and $215,673, respectively. For the years ended June 30, 2022 and 2021, approximately $7,600 and $14,300, respectively, was contributed to the fund and $22,500 and $10,000, respectively, was awarded in scholarships.
The Washburn Housing Loan Fund, named after the first Executive Director of Self-Help Enterprises, was established with the primary use of providing interim construction financing for homes built through the self-help housing program in urban areas, where the construction-to-perm mortgage product from USDA is not available.
The fund is used on a revolving basis to invest in these and other real estate projects. The net assets with donor restrictions in this fund at June 30, 2022 and 2021 were $3,484,765 and $3,603,151, respectively. For the years ended June 30, 2022 and 2021, approximately $12,000 and $13,000, respectively, was contributed to the fund and approximately $130,000 and $81,000, respectively, was released from restrictions.
The McAllister Fund, named after founder Bard McAllister, provides essential financial assistance to be used in the development, repair, or assessment of water and wastewater projects for disadvantaged communities in the SHE service area. The loans bear low interest and are made to entities that provide water or sewer service to small unincorporated communities. The net assets with donor restrictions in this fund at June 30, 2022 and 2021 were $131,254 and $127,433, respectively. For the years ended June 30, 2022 and 2021, approximately $2,700 and $2,000, respectively, was contributed to the fund and no amounts were released from restrictions.
NOTE 18 – RELATED PARTY TRANSACTIONS
The Organization conducts activities with sixteen limited liability companies and two subsidiary corporations which serve as the managing general partners for limited partnerships owning affordable rental housing properties. These properties are treated as affiliates, or presented at fair value, for the purposes of this consolidated financial statement (Note 1 – Principles of Consolidation). The entities are Annadale Commons LLC; Goshen Village II, LLC; Parksdale Village II LLC; Viscaya Gardens LLC; Highland Gardens LLC; SHE-CEF 1, Inc.; Palm Terrace LLC; Sierra Village GP LLC; Solinas/Almond LLC; Mariposa Oaks LLC; Valley Oaks LLC; Sequoia Commons LLC; Nupchi Xo’oy LLC; Sequoia Commons II LLC; Stonegate Village I LLC; Stonegate Village II LLC; Sugar Pine LLC and Solinas Village Inc. Together, these entities hold ownership interest in 22 rental housing properties, consisting of 1038 rental units. The Organization’s general partnership interest in SHE-CEF 1, Inc. is 0.10%.
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
44 NOTE 18 – RELATED PARTY TRANSACTIONS (Continued)
The following table discloses the related-party transactions between the Organization and the multifamily housing properties as of and for the year ended June 30, 2022:
Development
Note Funds Note and
Balance Loaned/ Balance Management
6/30/2021 Repaid 6/30/2022 Fees Received
Partnership Properties - General Partner
SHE-CEF I, Inc.
Biola Village - $ - $ - $ 25,173 $
Lincoln Plaza - - - 2,880
Parksdale Village - - - 34,039
Rancho Lindo - - - 29,411
Sand Creek - - - 29,647
Villa Del Rey - - - 23,348
Washington Plaza - - - 27,060
Annadale Commons, LLC
Annadale Commons 679,068 - 679,068 5,380
Creekside Terrace, LLC
Creekside Terrace 795,441 - 795,441 -
Goshen Village II, LLC
Goshen Village II - - - 86,893
Highland Gardens, LLC
Highland Gardens 816,741 - 816,741 14,999
The Lofts, LLC
Lofts at Fort Visalia - 150,000 150,000 -
Los Arroyos, LLC
Los Arroyos II - 150,000 150,000 -
Mariposa Oaks, LLC
Mariposa Oaks 20,000 - 20,000 1,656
Nupchi Xo'oy, LLC
Nupchi Xo'oy 550,000 (400,000) 150,000 22,022
Palm Terrace LLC
Palm Terrace 546,016 5,000 551,016 32,437
Palm Terrace II - 150,000 150,000 -
Parksdale Village II, LLC
Parksdale Village II - - - 32,255
Santa Fe Commons LLC
Santa Fe Commons I - 200,000 200,000 -
Sequoia Commons LLC
Sequoia Commons 1,642,734 20,000 1,662,734 30,413
Sequoia Commons II, LLC
Sequoia Commons II 1,931,269 (229,859) 1,701,410 29,051 Sierra Village GP, LLC
Sierra Village 430,000 - 430,000 65,251
Sierra Village II 1,373,227 - 1,373,227
Solinas/Almond, LLC
Almond Court 493,943 - 493,943 11,342
Solinas Village - - - 113,823
Stonegate Village I, LLC
Stonegate Village I 790,233 700,000 1,490,233 47,442
Stonegate Village II, LLC
Stonegate Village II 942,489 (752,952) 189,537 156,017
Sugar Pine LLC
Sugar Pine Village 250,000 - 250,000 -
Valley Oaks, LLC
Valley Oaks Apartments 384,655 (235,000) 149,655 9,491
Viscaya Gardens, LLC
Viscaya Gardens - - - 64,913
Total $ 10,272,589 $ 1,130,416 $ 11,403,005 $ 894,943
Corporation/Multifamily Housing Property
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
45 NOTE 18 – RELATED PARTY TRANSACTIONS (Continued)
The following table discloses the related-party transactions between the Organization and the multifamily housing properties as of and for the year ended June 30, 2021:
Development
Note Funds Note and
Balance Loaned/ Balance Management
6/30/2020 (Repaid) 6/30/2021 Fees Received
Partnership Properties - General Partner
SHE-CEF I, Inc.
Biola Village $ - $ - $ - $ 23,223
Lincoln Plaza - - - 23,880
Parksdale Village - - - 28,571
Rancho Lindo - - - 29,642
Sand Creek - - - 28,620
Villa Del Rey - - - 24,320
Washington Plaza - - - 27,168
Annadale Commons, LLC
Annadale Commons 1,179,068 (500,000) 679,068 2,160
Creekside Terrace LLC
Creekside Terrace - 795,441 795,441 -
Goshen Village II, LLC
Goshen Village II - - - 71,095
Highland Gardens, LLC
Highland Gardens 871,746 (55,005) 816,741 15,507
Mariposa Oaks, LLC
Mariposa Oaks 200,000 (180,000) 20,000 -
Nupchi Xo'oy, LLC
Nupchi Xo'oy 350,000 200,000 550,000 -
Palm Terrace, LLC
Palm Terrace 546,016 - 546,016 26,400
Parksdale Village II, LLC
Parksdale Village II - - - 29,273
Sequoia Commons, LLC
Sequoia Commons 2,295,000 (652,266) 1,642,734 117,476
Sequoia Commons II LLC
Sequoia Commons II 1,931,269 - 1,931,269 -
Sierra Village, LLC
Sierra Village 430,000 - 430,000 24,813
Solinas/Almond, LLC and Solinas Village Inc.
Almond Court 493,943 - 493,943 35,708
Solinas Village - - - 47,562
Stonegate Village I, LLC
Stonegate Village I 892,489 (102,256) 790,233 -
Stonegate Village II, LLC
Stonegate Village II 450,000 492,489 942,489 -
Sugar Pine LLC
Sugar Pine Village - 250,000 250,000 -
Valley Oaks, LLC
Valley Oaks Apartments 384,655 - 384,655 828
Viscaya Gardens, LLC
Viscaya Gardens - - - 16,137
Total $ 8,092,917 $ 2,179,672 $ 10,272,589 $ 572,383
Corporation/Multifamily Housing Property
SELF-HELP ENTERPRISES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
See Independent Auditor’s Report.
46 NOTE 19 – UNCERTAINTY
On March 11, 2020, the World Health Organization declared the outbreak of coronavirus, COVID-19, a pandemic. Accordingly, some functions of the Organization’s operations were limited to protect the health and safety of its employees. The financial impact that could occur as a result of the pandemic is unknown at this time.
NOTE 20 – SUBSEQUENT EVENTS
Subsequent to June 30, 2022, the following transactions occurred:
The Organization closed permanent financing for Sequoia Commons II on October 12, 2022 which resulted in a General Partner equity contribution of $2,674,085 and $2,000,000 sponsor loan along with a developer fee of $1,213,676.
The Organization closed construction financing on Los Arroyos I on November 1, 2022 and realized a $600,000 developer fee and reimbursement of all Construction in Progress (CIP) costs within 60 days of closing.
Effective July 1, 2022, the Organization will own Lincoln Plaza, a 40-unit affordable housing complex in Hanford, California. Alliant Tax Credit Fund 42, Ltd, A Florida limited liability partnership and Alliant ALP 42 LLC, a Florida limited liability company collectively assigned their interests to Almond Court, Inc., a subsidiary of Self-Help Enterprises.
Effective July 1, 2022, the Organization will own Biola Village, a 44-unit affordable housing complex in Biola, California. Alliant Tax Credit Fund 42, Ltd, A Florida limited liability partnership and Alliant ALP 42 LLC, a Florida limited liability company collectively assigned their interests to Almond Court, Inc., a subsidiary of Self-Help Enterprises.
Management has evaluated and concluded that there are no other subsequent events that have occurred from June 30, 2022 through the date the financials were available to be issued at December 16, 2022, that would require disclosure or adjustment.
47 SUPPLEMENTARY INFORMATION
48 THIS PAGE IS LEFT BLANK INTENTIONALLY.
49 INDEPENDENT AUDITOR’S REPORT
ON SUPPLEMENTARY INFORMATION
To the Board of Directors of
Self-Help Enterprises
Visalia, California
We have audited the consolidated financial statements of Self-Help Enterprises (the “Organization”), a nonprofit corporation, as of and for the year ended June 30, 2022, and have issued our report thereon dated December 16, 2022, which contained an unmodified opinion on those consolidated financial statements, on page 1. Our audit was performed for the purpose of forming an opinion on the consolidated financial statements as a whole.
The supplementary information on pages 51-56 and page 60 is presented for purposes of additional analysis and is not required as part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has not been subjected to the auditing procedures applied in the audit of the consolidated financial statements, and, accordingly, we do not express an opinion or provide any assurance on it.
Clovis, California
December 16, 2022
50 THIS PAGE IS LEFT BLANK INTENTIONALLY.
51 SELF-HELP ENTERPRISES
CONSOLIDATING STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED JUNE 30, 2022
(With Summarized Financial Information for 2021)
SHE Controlled 2022 2021
Subtotal SHE Multifamily Total SHE Total SHE
Combined Properties Subtotal SHE Eliminations Consolidated Consolidated ASSETS
Current assets:
Cash and cash equivalents $ 11,117,483 $ 1,899,351 $ 13,016,834 $ 13,016,834 - $ $ 7,717,305 Accounts receivable 7,643,267 71,005 7,714,272 (303,948) 7,410,324 5,699,337 Securities (at fair value) 5,008,156 5,008,156 - - 5,008,156 5,353,008Grants receivable 9,508,662 9,508,662 - - 9,508,662 6,044,715Interest receivable 497,557 - 497,557 (69,499) 428,058 220,504 Notes receivable - current portion - 2,163,004 2,163,004 (95,688) 2,067,316 1,730,943 Prepaids and deposits 151,543 286,758 438,301 - 438,301 730,317 Construction funds receivable - - - - - 653,290
Construction in progress - 5,362,596 5,362,596 - 5,362,596 14,575,307 Total current assets 41,452,268 2,257,114 43,709,382 (469,135) 43,240,247 42,724,726 Other assets:
Notes receivable net of current portion 35,996,977 35,996,977 - (2,515,690) 33,481,287 32,541,993 Investment in affiliates - 3,085,121 3,085,121 - 3,085,121 2,503,292Investment in affiliates at fair value - 81,109 - 81,109 81,109 213,307Restricted cash - 6,736,713 6,736,713 - 6,736,713 6,740,486Impound/reserve accounts 4,567,894 5,538,453 970,559 - 5,538,453 4,179,854Intangible assets, net 282,934 - - 282,934 282,934 282,934Land held for development - 17,709,341 17,709,341 - 17,709,341 10,866,576 Total other assets 64,579,820 4,850,828 69,430,648 (2,515,690) 66,914,958 57,328,442 Property, plant and equipment, net 8,391,625 41,182,798 - 49,574,423 49,574,423 32,996,654 Total assets $ 114,423,713 $ 48,290,740 $ 162,714,453 $ (2,984,825) $ 159,729,628 $ 133,049,822
LIABILITIES
Current liabilities:
Accounts payable and accrued expenses $ $ 1,502,096 $ 5,656,753 $ (303,948) 5,352,805 4,154,657 $ $ 4,849,980Construction funds payable 305,878 - 305,878 - 305,878 -Deferred grants 5,711,834 5,711,834 - - 5,711,834 6,786,483Notes Payable - current portion 1,903,946 206,184 2,110,130 (95,688) 2,014,442 3,137,051 Total current liabilities 12,076,315 1,708,280 13,784,595 (399,636) 13,384,959 14,773,514 Other long-term payables 2,862,536 2,862,536 - 2,862,536 2,315,615 Accrued/deferred interest - deferred notes 1,020,000 12,143,369 13,163,369 (69,499) 13,093,870 8,298,818 Deferred loans 20,918,125 20,918,125 - 20,918,125 20,202,737 Notes payable net of current portion 23,156,867 28,798,456 51,955,323 (2,515,690) 49,439,633 34,687,342 Total Liabilities 60,033,843 42,650,105 102,683,948 (2,984,825) 99,699,123 80,278,026
NET ASSETS
Net assets without donor restrictions 50,581,640 5,640,635 56,222,275 56,222,275 - 48,825,539 Net assets with donor restrictions - 3,808,230 3,808,230 - 3,808,230 3,946,257 Total net assets 54,389,870 5,640,635 60,030,505 - 60,030,505 52,771,796 Total liabilities and net assets $ 114,423,713 $ 48,290,740 $ 162,714,453 $ (2,984,825) $ 159,729,628 $ 133,049,822 52 SELF-HELP ENTERPRISES
CONSOLIDATING STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
(With Summarized Financial Information for 2021)
SHE Controlled
Subtotal SHE Multifamily Subtotal 2022 2021
Combined Properties SHE Eliminations Consolidated Consolidated Revenues, gains and other support
Grants $ 24,058,143 $ 50,867 $ 24,109,010 $ 24,109,010 - $ $ 13,953,241 Contract income 6,216,000 6,216,000 - 6,216,000 - 4,987,309 Interest income 432,779 2,396 435,175 (47,054) 388,121 289,976 Investment gains (471,826) (471,826) - (471,826) - 716,972 Land/development sales 7,607,387 7,607,387 - 7,607,387 - 5,391,822 Developer fees 6,810,074 6,810,074 - 6,810,074 - 3,656,690 Contributions 1,323,596 1,323,596 - 1,323,596 - 1,114,727 Earned loan forgiveness 81,000 63,518 144,518 - 144,518 1,684,700 Other income 279,211 235,463 514,674 (340,829) 173,845 464,196 Rental income 1,716,207 6,474,284 - 8,190,491 8,190,491 6,972,554 Total revenues, gains and other support 48,052,571 6,826,528 54,879,099 (387,883) 54,491,216 39,232,187 Expenses
Salaries and fringe benefits 13,090,709 1,667,562 14,758,271 14,758,271 - 12,527,396 Contract services 414,846 948,669 1,363,515 1,363,515 - 1,369,644 Travel 387,453 - 387,453 - 387,453 251,032
Space 717,831 2,557,896 3,275,727 3,275,727 - 2,366,858 Depreciation 616,517 2,980,363 3,596,880 3,596,880 - 2,418,410 Equipment rent/lease/purchase 375,165 - 375,165 - 375,165 218,522 Telephone 143,572 75,439 219,011 - 219,011 163,740
Insurance 320,769 241,631 562,400 - 562,400 509,989
Supplies 76,949 81,276 158,225 - 158,225 120,931
Postage 37,209 - 37,209 - 37,209 31,872
Project costs 18,280,706 18,280,706 - 18,280,706 - 7,425,644 Participant financing 188,923 - 188,923 - 188,923 93,361Interest expense 396,610 710,497 1,107,107 (47,054) 1,060,053 814,978 Cost of sales 7,001,120 7,001,120 - 7,001,120 - 4,326,040 Other costs 641,669 490,365 1,132,034 (340,829) 791,205 1,070,492Reserve expenses - 13,452 - 13,452 13,452 95,373 Total expenses 42,703,500 9,753,698 52,457,198 (387,883) 52,069,315 33,804,282 Increase (decrease) in net assets 5,349,071 (2,927,170) 2,421,901 2,421,901 - 5,427,905Net assets, beginning of year 49,040,799 3,730,997 52,771,796 52,771,796 - 47,343,891 Contributed capital 4,836,808 - - 4,836,808 4,836,808 - Net assets, end of year $ 54,389,870 $ 5,640,635 $ - 60,030,505 $ 60,030,505 $ $ 52,771,796 53 SELF-HELP ENTERPRISES
CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2022
(With Summarized Financial Information for 2021)
SHE Controlled
SHE Multifamily 2022 2021
Combined Properties Consolidated Consolidated
Cash Flows from Operating Activities:
Increase (decrease) in net assets $ 5,349,071 $ (2,927,170) $ 2,421,901 $ 5,427,905 Adjustment to reconcile increase (decrease) in net assets to net cash provided by (used in) operating activities:
Depreciation 616,517 2,980,363 3,596,880 2,418,410
Unrealized (gain) loss on marketable securities 471,826 - 471,826 (716,972) Unrealized (gain) loss on investments with affiliates (449,631) - (449,631) (1,263,853) Earned loan forgiveness (81,000) (63,518) (144,518) (1,684,700) Recovery of impairment loss (134,400) - (134,400) (313,600) (Increase) decrease in operating assets (2,219,108) (285,205) (2,504,313) (6,863,927) Increase (decrease) in operating liabilities 661,996 5,558,157 6,220,153 3,878,485 Net cash provided by (used in) operating activities 4,215,271 5,262,627 9,477,898 881,748 Cash Flows from Investing Activities:
Payments for purchases of property, plant and equipment (706,297) (4,990,292) (5,696,589) (831,455) Advances on notes receivable (5,554,516) - (5,554,516) (9,558,019) Principal payments received on notes receivable 4,242,268 - 4,242,268 4,231,949 Deposits to reserves 170,810 - 170,810 187,945
Withdrawals from reserves (113,427) - (113,427) (95,374) Cash from consolidation of subsidiary - 379,162 379,162 - Purchases of marketable securities (1,291,101) - (1,291,101) (1,677,585) Sale of marketable securities - 1,164,127 1,164,127 2,920,141 Net cash provided by (used in) investing activities (2,088,136) (4,611,130) (6,699,266) (4,822,398) Cash Flows from Financing Activities:
Proceeds from borrowings on long-term debt 9,028,385 - 9,028,385 2,303,922Principal payments on long-term debt (6,511,261) - (6,511,261) (2,004,864) Advances on line of credit 2,500,000 - 2,500,000 750,000 Payments on line of credit - (2,500,000) (2,500,000) (750,000) Net cash provided by (used in) financing activities - 2,517,124 2,517,124 299,058 Net increase (decrease) in cash and cash equivalents 4,644,259 651,497 5,295,756 (3,641,592) Cash and cash equivalents, beginning of year 13,209,937 1,247,854 14,457,791 18,099,383 Cash and cash equivalents, end of year $ 17,854,196 $ 1,899,351 $ 19,753,547 $ 14,457,791Reconciliation to Consolidating Statements of Net Position:
Unrestricted cash and cash equivalents $ 11,117,483 $ 1,899,351 $ 13,016,834 $ 7,717,305 Restricted cash and cash equivalents - 6,736,713 6,736,713 6,740,486 $ 17,854,196 $ 1,899,351 $ 19,753,547 $ 14,457,791
Supplemental Disclosure of Cash Payments for:
Interest $ 365,784 $ 34,132 $ 399,916 $ 373,275
54 SELF-HELP ENTERPRISES
COMBINING STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED JUNE 30, 2022
(With Summarized Financial Information for 2021)
SHE Owned
Total Multifamily 2022 2021
SHE Corporate Properties SHE Combined SHE Combined
ASSETS
Current assets:
Cash and cash equivalents $ 10,913,918 $ 203,565 $ 11,117,483 $ 6,469,451 Accounts receivable 7,504,080 139,187 7,643,267 5,810,616 Securities (at fair value) 5,008,156 - 5,008,156 5,353,008 Grants receivable 9,508,662 - 9,508,662 6,044,715
Interest receivable 497,557 - 497,557 281,735
Notes receivable - current portion - 2,163,004 2,163,004 1,823,111 Prepaids and deposits 125,118 26,425 151,543 609,147
Construction funds receivable - - - 653,290Construction in progress - 5,362,596 5,362,596 14,575,307 Total current assets 41,083,091 369,177 41,452,268 41,620,380 Other assets:
Notes receivable net of current portion 35,996,977 - 35,996,977 35,024,622 Investment in affiliates - 3,085,121 3,085,121 2,503,292Investment in affiliates at fair value 81,109 - 81,109 213,307 Restricted cash 6,736,713 - 6,736,713 6,740,486
Impound/reserve accounts 970,559 - 970,559 886,457
Land held for development - 17,709,341 17,709,341 10,866,576 Total other assets 63,609,261 970,559 64,579,820 56,234,740 Property, plant and equipment, net 2,776,989 5,614,636 8,391,625 8,121,402 Total assets $ 107,469,341 $ 6,954,372 $ 114,423,713 $ 105,976,522
LIABILITIES
Current liabilities:
Accounts payable and accrued expenses $ $ 154,581 4,000,076 $ 4,154,657 $ 4,046,199 Construction funds payable 305,878 305,878 -
Deferred grants 5,711,834 - 5,711,834 6,786,483
Notes payable - current portion 1,567,532 336,414 1,903,946 3,127,695 Total current liabilities 11,585,320 490,995 12,076,315 13,960,377 Other long - term payables 2,862,536 - 2,862,536 2,315,615Accrued interest payable-deferred notes - 1,020,000 1,020,000 960,000 Deferred loans 20,918,125 - 20,918,125 20,202,737
Notes payable net of current portion 17,183,390 5,973,477 23,156,867 19,496,994 Total liabilities 52,549,371 7,484,472 60,033,843 56,935,723
NET ASSETS
Net assets without donor restrictions 51,111,740 (530,100) 50,581,640 45,094,542 Net assets with donor restrictions - 3,808,230 3,808,230 3,946,257 Total net assets 54,919,970 (530,100) 54,389,870 49,040,799 Total liabilities and net assets $ 107,469,341 $ 6,954,372 $ 114,423,713 $ 105,976,522 55 SELF-HELP ENTERPRISES
COMBINING STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
(With Summarized Financial Information for 2021)
SHE Owned 2022 2021
Total SHE Multifamily Subtotal SHE Subtotal SHE
General Land Dev Grants Indirect Corporate Properties Eliminations Combined Combined Revenues, gains and other support
Grants $ 1,644,192 $ 241,355 $ 22,172,596 $ 24,058,143 - $ $ - $ 24,058,143 - $ $ 13,953,241 Contract income 5,945,211 270,789 - 6,216,000 - - 6,216,000 - 4,987,309 Interest income 339,701 72,148 20,410 432,259 - 520 432,779 - 310,603 Investment gain (loss) (471,826) - - (471,826) - - (471,826) - 716,972 Land/development sales 649,000 6,958,387 - 7,607,387 - - 7,607,387 - 5,391,822Developer Fees 6,810,074 - - 6,810,074 - 6,810,074 3,656,690 Contributions 1,173,596 150,000 - 1,323,596 - - 1,323,596 - 1,114,727 Earned loan forgiveness 81,000 - - 81,000 - - 81,000 - 1,684,700 Other income 243,733 18,740 24,890 287,363 - 14,348 (22,500) 279,211 650,064 Rental income - - - - - 1,716,207 - 1,716,207 1,698,892 Total revenues, gains and other support 16,333,681 7,792,419 - 22,217,896 46,343,996 1,731,075 (22,500) 48,052,571 34,165,020 Expenses
Salaries and fringe benefits 4,802,573 371,595 5,624,765 1,969,619 12,768,552 322,157 13,090,709 - 11,051,203 Contract services 144,723 7,438 43,996 59,327 255,484 159,362 414,846 - 416,260 Travel 80,061 6,270 289,548 11,574 387,453 387,453 - 251,032 Space 55,565 3,590 69,549 20,042 148,746 569,085 717,831 - 642,682 Depreciation 69,470 3,566 59,475 19,782 152,293 464,224 616,517 - 607,868 Equipment rent/lease/purchase 141,571 8,725 178,259 46,610 375,165 - 375,165 - 218,522 Telephone 51,233 3,655 66,137 12,583 133,608 9,964 143,572 - 109,433 Insurance 68,427 3,086 140,554 49,005 261,072 59,697 320,769 - 334,244 Supplies 29,214 1,394 25,213 6,586 62,407 14,542 76,949 - 58,421 Postage 21,544 595 12,738 2,332 37,209 - 37,209 - 31,872 Project costs 3,455,305 381,753 14,443,648 18,280,706 - - 18,280,706 - 7,425,644 Participant financing 66,861 98,000 24,062 188,923 - - 188,923 - 93,361 Interest expense 241 302,237 - 302,478 - 94,132 396,610 - 345,900 Cost of sales 689,575 6,311,545 - 7,001,120 - - 7,001,120 - 4,326,040 Other costs 466,294 15,698 65,595 51,087 598,674 65,495 (22,500) 641,669 914,283Reserve expenses - - - - 13,452 - 13,452 - 95,373 Allocated indirect expenses 996,970 77,220 1,174,357 - (2,248,547) - - - - Total expenses 11,139,627 7,596,367 22,217,896 - 40,953,890 1,772,110 (22,500) 42,703,500 26,922,138 Increase (decrease) in net assets 5,194,054 196,052 - 5,390,106 - (41,035) 5,349,071 - 7,242,882 Net assets, beginning of year 33,547,426 - 15,982,438 - 49,529,864 - (489,065) 49,040,799 41,797,917 Net assets, end of year $ 38,741,480 $ - 16,178,490 $ - $ 54,919,970 $ $ - (530,100) $ 54,389,870 $ $ 49,040,799 56 SELF-HELP ENTERPRISES
SCHEDULE OF CONSTRUCTION ACTIVITY
FOR THE YEAR ENDED JUNE 30, 2022
6/30/2021 Additions Cost of Sales
Recognize
Impairment Adjustments 6/30/2022 Sales Cost of Sales Gain/(Loss) Land Development
Bakersfield SF $ 212,759 $ 6,386 $ (84,745) $ (134,400) $ - $ - $ 135,000 $ (84,745) $ 50,255 Bakersfield MF - Madison/Haven 37,817 - - (37,817) - - - - - Chowchilla SF 1,144,659 59,439 - - 1,204,098 - - - -
Dinuba Sierra Village II 881,533 (267,500) - (614,033) - - 267,500 (267,500) -Farmersville-Los Arroyos I 593,127 75,432 - - 668,559 - - - - Farmersville-Los Arroyos II 739,558 - (212,500) (527,058) - - 212,500 (212,500) - Fresno SHH (Florence & Geary) 1,258 11,812 - - - 13,070 - - - Fresno In-fill 8,620 25,612 - - - 34,232 - - -
Fresno Libre Commons 33,008 - - - - 33,008 - - -
Fresno SF 343,692 1,331,739 - - 1,675,431 - - - -Goshen Village EastMF III & IV 395,946 267,727 - (179,286) - 484,387 - - - Goshen Village East SF I 363,262 8,910 - - 372,172 - - - - Hanford - North Star 9,598 73,188 - - - 82,786 - - -
The Haven 22,851 - - - - 22,851 - - -
Hanford SF - 3 lots 28,192 7,501 - - - 35,693 - - -LeGrand SF 223,167 15 - - 223,182 - - - -Lindsay Palm Terrace II 607,887 (307,887) (300,000) - - - 300,000 (300,000) - Lindsay Mt. Whitney 3,319 (3,319) (35,342) 35,342 - - 32,357 (35,342) (2,985) Lindsay SF 8,483 10,984 - - - 19,467 - - -
Madison Place 53,281 - - - - 53,281 - - -
Mariposa -Home Key Project - 3,050 - - - 3,050 - - -
Merced - Mercy Village 42,812 5,438 - - - 48,250 - - -
MF Energy Projects 594,399 691,390 - - 1,285,789 - - - -MF Resyndication 54,780 - - (54,780) - - - - - Oakhurst MF (River Grove) 198,766 - - - 198,766 - - - -Orosi SF 1,762,379 467,344 (438,047) 90,697 - 1,882,373 476,000 (438,047) 37,953 Parksdale 3 - SF 1,257,667 15,574 - - 1,273,241 - - - - Patterson SF 2,301,952 19,385 (1,857,096) (464,241) - 1,850,000 - (1,855,045) (5,045) Patterson SF2 & 3 352,655 118,768 - - 471,423 - - - -
Planada SF 3,488,684 284,471 - - 3,773,155 - - - -
Porterville - Finca Serena 126,628 - - (126,628) - - - - - Reedley - Guardian Village 65,723 93,512 - - 159,235 - - - - Reedley SF 5,572,056 206,092 (1,881,780) (2,640) - 3,893,728 2,090,000 (1,881,780) 208,220 Sanger Cherry Crossing I 359,036 - - - 359,036 - - - -
Sanger Cherry Crossing II 268,660 - - - 268,660 - - - - Shafter SF 831,464 690,762 - - 1,522,226 - - - -
Tulare-Santa Fe Commons 627,753 (305,030) - (322,723) - - 305,030 (305,030) - TULMFII (Santa Fe Commons II) 250,326 - - 10,006 - 260,332 - - - Turlock 1,709,678 25,648 - - 1,735,326 - - - -
Visalia - The Lofts 559,288 - - (559,288) - - - - -
Visalia Cogegio MF II 38,304 - - - - 38,304 - - -
Visalia - Colegio 10,878 11,924 - - - 22,802 - - -
Woodlake North SF 1,273,390 20,387 (931,556) - - 362,221 990,000 (931,556) 58,444 Subtotal 25,495,505 6,185,074 (6,313,596) (134,400) (2,752,449) 22,480,134 6,658,387 (6,311,545) 346,842 Allowance for real estate impairment loss - (970,400) - 134,400 - (836,000) - - - Total land development 24,525,105 6,185,074 (6,313,596) - (2,752,449) 21,644,134 6,658,387 (6,311,545) 346,842 Construction In ProgressBakersfield SF Home Construction 383,760 285,474 (689,575) - 82,455 62,114 949,000 (689,575) 259,425Property Held for Resale Various properties 533,015 - 832,674 - - 1,365,689 - - - Total property held for resale 533,015 - 832,674 - - 1,365,689 - - - Total 25,441,880 $ $ 7,303,222 $ (7,003,171) - $ (2,669,994) $ $ 23,071,937 $ 7,607,387 $ (7,001,120) $ 606,267
CONSTRUCTION ACTIVITY SALES ACTIVITY
City
57 SINGLE AUDIT
SELF-HELP ENTERPRISES
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
58 Federal Assistance # Grant or Contract #
Total Costs Expended/
Outstanding Balance
U.S. Department of the Treasury
Pass Through Programs:
Local Initiative Support Corp - Emergency Rental Assistance Program 21.023 $ 188,283 Community Development Financial Institutions Fund:
Capital Magnet Fund 21.020 171CM022190 14,500
NeighborWorks America:
Leadership Institute PL# 116-6 R-SUPINT-2019-55012 -
FY2020 Round I Leadership Institute Water Tour PL# 116-94 NA 2,400 Total U.S. Department of Treasury 205,183
U.S. Department of Agriculture
Direct Programs:
Rural Housing Preservation Grant 10.433 HPG 533 FY 2018 115,869 Rural Housing Preservation Grant 10.433 HPG 533 FY 2019 23,269 Rural Self-Help Technical Assistance 523 Grant 10.420 * 523 TA 2018 2,153,435 Rural Community Development Initiative 2018 10.446 04-054-941592676-08 18,726 Rural Community Development Initiative 2019 10.446 04-054-941592676 65,997 Rural Community Development Initiative 2021 10.446 04-054-941592676 21,296 Rural Development Multiple Family Housing 10.411 * 04-054-0941592676-19-6 750,829 Farm Labor Housing Loans and Grants 10.405 Various 3,714,311 Rural Rental Assistance Payments - Bear Creek Housing Community 10.427 381,573 Rural Rental Assistance Payments - Casas de la Vina 10.427 251,677 Rural Rental Assistance Payments - Vera Cruz Village 10.427 880,345 8,377,327
Pass Through Programs:
Rural Community Assistance Corporation:
Water and Waste Water Disposal Systems for Rural Communities 2021 10.761 TECH21-S011 8,003 Water and Waste Water Disposal Systems for Rural Communities 2022 10.761 TECH22-S011 9,424 17,427
Total U.S. Department of Agriculture 8,394,754
U.S. Department of Housing and Urban Development
Pass Through Programs:
California Department of Housing and Community Development HUD Section 4:
Unidos US 14.169 HC200011006 38,700
Local Initiatives Support Corporation 14.252 41215-0056 3,000 B-19-CB-MD-0001 - Enterprise Community Partners, Inc. 14.252 19SG1556 7,359 B-19-CB-MD-0001 - Enterprise Community Partners, Inc. 14.252 20SG1818 31,063 Community Development Block Grant - City of Arvin Business Assistance 14.218 2020-20 99,277 Community Development Block Grant - City of Arvin 14.218 2020-052 53,901 Community Development Block Grant - City of Arvin 14.218 None 2,163 Community Development Block Grant - City of Avenal 14.218 2020-39 43,406 Community Development Block Grant - City of Avenal Subsistence 14.218 None 115,306 Community Development Block Grant - City of Coalinga 14.218 None 95,463 Community Development Block Grant - City of Coalinga Business Assistance 14.218 None 58,296 Community Development Block Grant - City of Corcoran 14.218 2020-3062 33,694 Community Development Block Grant - City of Corcoran 14.218 None 68,349 Community Development Block Grant - County of Tulare 14.218 None 301,487 Community Development Block Grant - City of Dinuba 14.218 2020-53 81,120 Community Development Block Grant - City of Dinuba Subsistence 14.218 2021-05 183,956 Community Development Block Grant - City of Dinuba Business Assistance 14.218 2021-05 16,385 Community Development Block Grant - City of Exeter Business Assistance 14.218 2021-02 93,038 Community Development Block Grant - County of Kings 14.218 None 44,287 Community Development Block Grant - City of Lindsay 14.218 None 203,487 Community Development Block Grant - City of Lindsay 14.218 None 8,809 Community Development Block Grant - City of Livingston 14.218 2020-55 63,916 Community Development Block Grant - City of Livingston Business Assistance 14.218 2021-03 130,755 Community Development Block Grant - City of Livingston Business Assistance 14.218 2021-03 16,931 Community Development Block Grant - County of Mariposa 14.218 2021-03 804 Community Development Block Grant - City of Orange Cove Subsistence 14.218 2021-05 219,082 Community Development Block Grant - City of Orange Cove Business Assistance 14.218 2021-05 52,812 Community Development Block Grant - City of Sanger 14.218 None 30,443 Community Development Block Grant - City of Sanger Subsistence 14.218 2021-08 75,556 Community Development Block Grant - City of Sanger Business Assistance 14.218 2021-08 35,442 Community Development Block Grant - City of Wasco 14.218 None 75,016 Community Development Block Grant - City of Woodlake Subsistence 14.218 None 80,444 Community Development Block Grant - City of Woodlake Business Assistance 14.218 None 18,391 Home Investment Partnership Program - City of Coalinga 14.239 None 1,377 Home Investment Partnership Program - County of Mariposa 14.239 None 2,454 Home Investment Partnership Program - City of Sanger 14.239 None 15,554 Home Investment Partnership Program 14.239 None 32,376
HUD Section 3:
Community Development Block Grant - Subrecipient via City of Fresno 14.218 2019-096 127,587 Community Development Block Grant - Subrecipient via City of Fresno 14.218 020-237 494,608 Housing Assistance Council - SHOP 2017 14.247 1-2105-1811 81,000 Total U.S. Department of Housing and Urban Development 3,137,094 U.S. Department of Health and Human Services
Pass Through Programs:
Rural Community Assistance Corporation
Department of Community Services and Development 93.569 CSD21-S011/21 8,922 Department of Community Services and Development 93.569 CSD22-S011/22 2,077 Total U.S. Department of Health and Human Services 10,999 Center for Disease Control
Pass Through Programs:
Sierra Health Foundation - The Center 93.268 CA22CCO032 106,590 Total Expenditures of Federal Awards $ 11,854,620
Federal Grantor/Pass-Through Grantor/Program Title
SELF-HELP ENTERPRISES
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
59 NOTE 1 – BASIS OF PRESENTATION
The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) includes the federal grant activity of Self-Help Enterprises under programs of the federal government for the year ended June 30, 2022.
The information in this schedule is presented in accordance with the requirements of OMB’s Uniform Guidance.
Because the Schedule presents only a selected portion of the operations of Self-Help Enterprises, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Self-Help Enterprises.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB’s Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Federal awards received directly from federal agencies as well as federal awards passed through other government agencies are included in the Schedule. Pass-through entity identifying numbers are presented where available.
Self-Help Enterprises did not provide federal funds to sub recipients.
NOTE 3 – INDIRECT COST RATE
Self-Help Enterprises has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
NOTE 4 – RELATIONSHIP TO FEDERAL FINANCIAL REPORTS
Information included in the accompanying Schedule of Expenditures of Federal Awards is in substantial agreement with the information reported in the related financial reports for major programs.
NOTE 5 – FEDERAL LOAN BALANCES OUTSTANDING
The following schedule summarizes the outstanding loan balances for federal programs as of June 30, 2022:
Federal Assistance # Loan Balance
U.S. Department of Agriculture
Direct programs:
Farm labor housing loans and grants:
Bear Creek Housing Community 10.405 $ 1,814,272
Casas de la Vina 10.405 926,550
Vera Cruz Village 10.405 491,389
Sunrise Villa 10.405 139,612
Total farm labor housing loans and grants 3,371,823
Rural housing site loans 10.411 -
Total outstanding loan balances at June 30, 2022 $ 3,371,823 Pass-Through Grantor/Federal Grantor/Program Title
SELF-HELP ENTERPRISES
SCHEDULE OF EXPENDITURES OF STATE AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
60 Grant or Contract #
Total Costs Expended/
Outstanding Balance
State of California Department of Housing and Community Development CALHOME Agreement for Single-family Self-Help Home 19-CalHome-14642 $ 834,799 Infill Infrastructure Grant Program - Goshen 19-IIG-14406 170,141 Total Grants Costs Expended 1,004,940
State of California Department of Water Resources
Direct Programs:
For The Benefit of Tulare County 4600012187 274,849
Total Grants Costs Expended 274,849
State of California Office of Emergency Services
Direct Programs:
LISTOS Emergency Preparedness Grant LS21 01 1168 1,577
Total Grants Costs Expended 1,577
State of California Water Resources Control Board
Clean-up and Abatement Account:
Direct Programs:
Tombstone Territory Bottled Water Project D1711303 1,265 Three Palms Interim Emergency Bottled Water Project D1918109 24,484 Parlier Unified School District Interim Emergency Bottled Water Project D1918108 2,485 R.S. Mutual Interim Emergency Bottled Water Project D1912703 3,922 32,156
SB108 Construction and Implementation Grant (Water Well) D17-11-971 660,843 Dry Well, Tanks, Hauling D2018001 13,320,946
Regional Bottled Water D1917010 768,323
Household Water Well Assistance D1917011 486,277
Drinking Water for Schools Round 2 - Implementation Grant D1916402 171,776 Regional Private Domestic Water Well Abandonment, Repair, Replacement, Connect D2017017 372,147 15,780,312
Safe and Affordable Drinking Water Fund:
Arrearage Assistance for Small Water Systems D1917012 57,195 Technical Assistance for Implementation D1917012 2,252,557 2,309,752
Proposition 1 Funding for Technical Assistance:
Small DACs - Capital Improvement Projects D16-12-802 1,124,410 Total SWRCB-Grant Costs Expended 19,246,630
Total Expenditures of State Awards $ 20,527,996
Pass-Through Grantor/State Grantor/Program Title
61 INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the Board of Directors of
Self-Help Enterprises
Visalia, California
We have audited, in accordance with the 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, the consolidated financial statements of Self-Help Enterprises (the "Organization"), a nonprofit organization, which comprise the consolidated statement of financial position as of June 30, 2022, and the related consolidated statements of activities, functional expenses and cash flows for the year then ended, and the related notes to the consolidated financial statements, and have issued our report thereon dated December 16, 2022.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the consolidated financial statements, we considered the Organization’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the consolidated financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Organization’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Organization’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Organization’s consolidated financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Organization’s consolidated financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the consolidated financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. 62 Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Organization’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Organization’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Clovis, California
December 16, 2022
63 INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE
FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL
OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
To the Board of Directors of
Self-Help Enterprises
Visalia, California
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited Self-Help Enterprises’ (the Organization) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of Self-Help Enterprises’ major federal programs for the year ended June 30, 2022. The Organization’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.
In our opinion, Self-Help Enterprises complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2022.
Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the Organization and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of the Organization’s compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Organization’s federal programs.
Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the Organization’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, 64 Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists.
The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the Organization’s compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the Organization’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances. Obtain an understanding of the Organization’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the Organization’s internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance.
Accordingly, this report is not suitable for any other purpose.
Clovis, California
December 16, 2022
SELF-HELP ENTERPRISES
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2022
65 SECTION I – SUMMARY OF AUDITOR’S RESULTS
FINANCIAL STATEMENTS
Type of auditor's report issued: Unmodified
Internal control over financial reporting:
Material weaknesses identified? Yes X No
Significant deficiencies identified -
not considered to be material weaknesses? Yes X No
Noncompliance material to financial statements noted? Yes X No
FEDERAL AWARDS
Internal control over major programs:
Material weaknesses identified? Yes X No
Significant deficiencies identified -
not considered to be material weaknesses? Yes X No
Type of auditor's report issued on compliance for
major programs: Unmodified
Any audit findings disclosed that are required
to be reported in accordance with
2 CFR 200, Section 200.516(a)? Yes X No
IDENTIFICATION OF MAJOR PROGRAMS
Federal Assistance Number(s)
10.420 Rural Self Help Technical Assistance
10.411 Rural Development Multi-Family Housing
Dollar threshold used to distinguish
between Type A and Type B programs:
Auditee qualified as low-risk auditee? X Yes No
Name of Federal Program or Cluster
$750,000
SECTION II – FINANCIAL STATEMENT FINDINGS
None reported.
SECTION III – FEDERAL AWARD FINDINGS
None reported.
SELF-HELP ENTERPRISES
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2022
66 FINANCIAL STATEMENT FINDINGS
None reported.
FEDERAL AWARD FINDINGS
None reported.
Part A, Exhibit 7
United States Department of the Interior
OFFICE OF THE SECRETARY
Washington, DC 20240
Nonprofit Organization
Indirect Cost Negotiation Agreement
EIN: 94-1592676 Date: 02/25/2022
Organization: Report Number: 2022-0111
Self-Help Enterprises
P.O. Box 6520 Filing Ref.:
Visalia, CA 93290 Last Negotiation Agreement
dated: 04/29/2021
The indirect cost rates contained herein are for use on grants, contracts, and other agreements with the Federal Government to which Public Law 93-638 and/or 2 CFR Part 200 apply subject to the limitations contained in Section II.A. of this agreement. The rates were negotiated by the U.S. Department of the Interior, Interior Business Center, and the subject organization in accordance with the authority contained in applicable regulations.
Section I: Rate
Start Date End Date Rate Type
07/01/2020 06/30/2021 Final
Name Rate Base Location Applicable To
Indirect 20.33 % (A) All All Programs
07/01/2021 06/30/2022 Predetermined
Name Rate Base Location Applicable To
Indirect 20.25 % (A) All All Programs
07/01/2022 06/30/2023 Predetermined
Name Rate Base Location Applicable To
Indirect 20.25 % (A) All All Programs
(A) Base: Total direct salaries and wages, including fringe benefits. The rate applies to all programs administered by the non-federal entity. To determine the amount of indirect costs to be billed under this agreement, direct salaries and wages and related fringe benefits should be summed and multiplied by the rate. All other program costs should be eliminated from the calculation.
Treatment of fringe benefits: Fringe benefits applicable to direct salaries and wages are treated as direct costs; fringe benefits applicable to indirect salaries and wages are treated as indirect costs.
Treatment of paid absences: Vacation, holiday, sick leave, and other paid absences are included in salaries and wages and are claimed on grants, contracts, and other agreements as part of the normal cost for the salaries and wages.
Separate claims for the costs of these paid absences are not made.
DocuSign Envelope ID: C6058367-B24F-4620-9F8C-3AEEA3ABA89E Section II: General
A. Limitations: Use of the rate(s) contained in this agreement is subject to any applicable statutory limitations.
Acceptance of the rate(s) agreed to herein is predicated upon these conditions: (1) no costs other than those incurred by the subject organization were included in its indirect cost rate proposal, (2) all such costs are the legal obligations of the grantee/contractor, (3) similar types of costs have been accorded consistent treatment, and (4) the same costs that have been treated as indirect costs have not been claimed as direct costs (for example, supplies can be charged directly to a program or activity as long as these costs are not part of the supply costs included in the indirect cost pool for central administration).
B. Audit: All costs (direct and indirect, federal and non-federal) are subject to audit. Adjustments to amounts resulting from audit of the cost allocation plan or indirect cost rate proposal upon which the negotiation of this agreement was based will be compensated for in a subsequent negotiation.
C. Changes: The rate(s) contained in this agreement are based on the accounting system in effect at the time the proposal was submitted. Changes in the method of accounting for costs which affect the amount of reimbursement resulting from use of the rate(s) in this agreement may require the prior approval of the cognizant agency. Failure to obtain such approval may result in subsequent audit disallowance.
D. Rate Type:
1. Fixed Carryforward Rate: The fixed carryforward rate is based on an estimate of the costs that will be incurred during the period for which the rate applies. When the actual costs for such period have been determined, an adjustment will be made to the rate for a future period, if necessary, to compensate for the difference between the costs used to establish the fixed rate and the actual costs.
2. Provisional/Final Rate: Within six (6) months after year end, a final indirect cost rate proposal must be submitted based on actual costs. Billings and charges to contracts and grants must be adjusted if the final rate varies from the provisional rate. If the final rate is greater than the provisional rate and there are no funds available to cover the additional indirect costs, the organization may not recover all indirect costs.
Conversely, if the final rate is less than the provisional rate, the organization will be required to pay back the difference to the funding agency.
3. Predetermined Rate: A predetermined rate is an indirect cost rate applicable to a specified current or future period, usually the organization's fiscal year. The rate is based on an estimate of the costs to be incurred during the period. A predetermined rate is not subject to adjustment.
E. Rate Extension: Only final and predetermined rates may be eligible for consideration of rate extensions.
Requests for rate extensions of a current rate will be reviewed on a case-by-case basis. If an extension is granted, the non-Federal entity may not request a rate review until the extension period ends. In the last year of a rate extension period, the non-Federal entity must submit a new rate proposal for the next fiscal period.
F. Agency Notification: Copies of this document may be provided to other federal offices as a means of notifying them of the agreement contained herein.
G. Record Keeping: Organizations must maintain accounting records that demonstrate that each type of cost has been treated consistently either as a direct cost or an indirect cost. Records pertaining to the costs of program administration, such as salaries, travel, and related costs, should be kept on an annual basis.
H. Reimbursement Ceilings: Grantee/contractor program agreements providing for ceilings on indirect cost rates or reimbursement amounts are subject to the ceilings stipulated in the contract or grant agreements. If the ceiling rate is higher than the negotiated rate in Section I of this agreement, the negotiated rate will be used to determine the maximum allowable indirect cost.
DocuSign Envelope ID: C6058367-B24F-4620-9F8C-3AEEA3ABA89E Section II: General (continued)
I. Use of Other Rates: If any federal programs are reimbursing indirect costs to this grantee/contractor by a measure other than the approved rate(s) in this agreement, the grantee/contractor should credit such costs to the affected programs, and the approved rate(s) should be used to identify the maximum amount of indirect cost allocable to these programs.
J. Other:
1. The purpose of an indirect cost rate is to facilitate the allocation and billing of indirect costs. Approval of the indirect cost rate does not mean that an organization can recover more than the actual costs of a particular program or activity.
2. Programs received or initiated by the organization subsequent to the negotiation of this agreement are subject to the approved indirect cost rate(s) if the programs receive administrative support from the indirect cost pool. It should be noted that this could result in an adjustment to a future rate.
3. This Negotiation Agreement is entered into under the terms of an Interagency Agreement between the U.S.
Department of the Interior and the cognizant agency. No presumption of federal cognizance over audits or indirect cost negotiations arises as a result of this Agreement.
4. Organizations that have previously established indirect cost rates—exclusive of the 10% de minimis rate— must submit a new indirect cost proposal to the cognizant agency for indirect costs within six (6) months after the close of each fiscal year.
DocuSign Envelope ID: C6058367-B24F-4620-9F8C-3AEEA3ABA89E Section III: Acceptance
Listed below are the signatures of acceptance for this agreement:
By the Nonprofit Organization By the Cognizant Federal Government Agency Self-Help Enterprises US Department of Agriculture - RHS signature2 signature1
Signature Signature
Thomas J Collishaw Craig Wills
Name: Name:
Division Chief
President/Chief Executive Officer
Indirect Cost & Contract Audit Division
Interior Business Center
Title: Title:
signatureDate2 signatureDate1
Date Date
Negotiated by: Muberra Guvenc
Telephone: (916) 930-3816
Next Proposal Due Date: 12/31/2022
DocuSign Envelope ID: C6058367-B24F-4620-9F8C-3AEEA3ABA89E 2/28/2022 2/25/2022
Part A, Exhibit 8
Part B
Application