954.504—Closeout.
(1)
All funds to be closed out have been drawn down and expended for completed project costs, or funds not drawn down and expended have been deobligated by HUD;
(2)
Project Completion Reports for all projects using funds to be closed out have been submitted. HUD will use data contained in the project completion reports in the preparation of the Closeout Reports;
(3)
The grantee has been reviewed and audited and HUD has determined that all requirements, including affordability (for which also see paragraph (b)(2) of this section), are met or all monitoring and audit findings have been resolved.
(i)
A signed copy of the grantee's most recent audit report—covering all funds to be closed out—must be received by HUD. If the audit review by the Department of Interior (DOI) results in significant delays, the Area ONAP may request a signed copy of the audit prior to DOI review and use it as the document needed prior to closeout. If the audit does not cover all funds to be closed out, the closeout may proceed, provided the grantee agrees in the Closeout Report that any costs paid with the funds that were not audited must be subject to the grantee's next single audit and that the grantee may be required to repay to HUD any disallowed costs based on the results of the audit.
(ii)
The on-site monitoring of the grantee by the Area ONAP must include verification of data reflected in the Closeout Report and reconciliation of any discrepancies which may exist between HUD data and grantee records.
(b)
The Closeout Report contains the final data on the funds and must be signed by the grantee and HUD. In addition, the report must contain:
(1)
A provision regarding unaudited funds (“closeout subject to audit”), required by paragraph (a)(3)(i) of this section; and
(2)
A provision requiring the grantee to continue to meet the requirements applicable to housing projects for the period of affordability specified in § 954.306 or § 954.307, to keep records demonstrating that the requirements have been met and to repay the HOME funds, as required by § 954.500, if the housing fails to remain affordable for the required period.