I was changing the water just now & noticed a yellow sponge growing among my yellow polyps. Almost fully encasing one polyp. I'm guessing this is ok so I'm gonna leave it be. Unless someone tells me differently.
I have some dull red ones that are tight up against the bottom of some rock but this is the first one I see yellow and out in the open.
I keep my water less than pristine as I have scallops and they are filter feeders.