Sunflower House

Sunflower House, Inc. (the Organization) was incorporated in the District of Columbia as a notforprofit entity for purposes of owning and operating a rental housing property under the National Housing Act, as amended. The construction of the rental housing property was completed in October 1998, and a certificate of occupancy was issued on April 25, 2001. The property is a building consisting of twentyone housing units located in northeast Washington, D.C. The Organization entered into a Project Rental Assistance Contract with the U.S. Department of Housing and Urban Development (HUD). Under Section 811 of the National Affordable Housing Act, HUD makes housing assistance payments to the Organization on behalf of qualified tenants. HUD regulates such projects as to monthly rent, operating practices and tenant eligibility. The Organization entered into a Regulatory Agreement prohibiting distributions to the Organization and requiring that surplus cash, as defined by HUD, be deposited in a residual receipts fund ninety days after the end of the fiscal year, to the extent available. The Regulatory Agreement also requires that monthly deposits of $1,550 be made to a reserve fund for replacements to be used for future replacement of structural elements and mechanical equipment at the property. Sunflower House, Inc. is one of four notforprofit entities sharing common directors, facilities, and personnel. The other entities are: Building Futures: Family AIDS Housing, Inc. (Building Futures, Marigold Place, Inc. (collectively, Affiliates). Those entities are engaged in activities similar to Sunflower House. Building Futures, the parententity, manages the project under a management agreement approved by HUD and provides for a management fee of $50 per unit per month.