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On Thursday, November 9, 2017 HUD hosted a live webinar to provide an overview and discussion of the recently developed Completion Certification and the RAD Minority Concentration Analysis Tool. A video of the webinar can be found here along with slides from the presentation.

Construction Completion Certification. Once construction or rehabilitiation is complete, Section 1.13(B)(6) of the RAD Notice requires that Owners submit a completion certification including a cost certification and other information about compliance with requirements of the RCC.  The Office of Recapitalization recently created a module on the RAD Resource Desk entitled the “Rehab/Construction Completion Milestone” and also posted instructions on completing the certification.   Submitting the Completion of the Rehab/Construction Milestone information should be done no later than 45 days after completion of the work. The new module requires owners to provide information related to the completion of work, residents’ right of return, and Section 3 hiring achieved.  Owners should become familiar with the requested information regardless of where they are in the RAD conversion process to understand what data will be needed to complete the certification, including some information that dates back to the issuance of the CHAP.

RAD Minority Concentration Analysis Mapping Tool. HUD has released the RAD Minority Concentration Analysis Tool (the “Tool”) in order to help housing authorities assess whether a proposed site for new construction under RAD may be in an area of minority concentration.  The Tool will create a report of data required by the RAD Fair Housing and Civil Rights Notice (H/PIH 2016-17), including minority data from the Census for: 1) the Housing Market Area; 2) the census tract; 3) the area comprised of the census tract of the site together with all adjacent census tracts; and 4) an alternative geography if proposed by the housing authority. The Tool is available at https://www.huduser.gov/portal/maps/rad/home.html and requires creating a user account.

Just in time for the end of the federal fiscal year (September 30), the HUD Office of Inspector General (OIG) issued a flurry of internal and external audit reports over the last few weeks on a wide variety of topics. They include:

Our friends at NAHRO have alerted us that a new RAD notice will be issued tomorrow, August 23, 2017. The notice requires PHAs who already submitted a RAD letter of interest to preserve their spot on the wait list to submit a RAD application within 60 days if they want to continue in the RAD program. Guidance is also provided for setting rents for all RAD applications awarded outside of the previous 185,000 RAD cap, or for revocations or withdrawals after May 5, 2017 below that cap; rent levels for all such awards will be set at FY 2016 funding levels.  Per the appropriations notice that extended the RAD cap, the outside deadline for final submission of multiphase award applications is extended to September 30, 2020.

Today, the HUD Office of Inspector General (OIG) published a bulletin indicating that it is unclear if undocumented immigrants have access to certain HUD Community Planning and Development (CPD) programs – namely the Housing for Persons with AIDS (HOPWA) and homeless assistance programs.

The bulletin explains that undocumented immigrants do not typically have access to HUD programs such as public housing or Section 8 because such programs are explicitly unavailable to such immigrants.  For many HUD-assisted programs, there is a regulation that specifies which types of non-citizen families may have access to those programs and that instructs PHAs and owners on how to prorate assistance to families that include eligible and ineligible persons.

Exempt from this regulation, however, are programs that provide assistance that protects life and safety – essentially emergency services.  The OIG explains that, unlike the public housing and Section 8 programs, “there does not appear to be any clear guidance” as to whether undocumented immigrants can (or cannot) access programs that are funded through HUD’s community development programs and administered through nonprofits, including HOPWA and homeless assistance. Accordingly, the OIG recommends that HUD clarify this issue.

On August 9, HUD issued to Congress its 16th report on worst case housing needs in the United States, based on 2015 data.  Households with “worst case needs” are those that are very low income, do not receive government housing assistance and either pay more than 1/2 of their income for rent or live in severely inadequate conditions, or both.  Findings include:

  • Severe housing problems are increasing despite a decent economy.
  • In 2015, 8.30 million households had worst case needs. This is an increase from 7.72 million in 2013.  The record high for worst case needs is 8.48 million in 2011.
  • Worst case needs affect all types of households, whether examined by age and ethnicity, household structure, or location
    within metropolitan areas or region.

The report identifies a shift from homeownership to renting as the biggest cause of the increase in worst case needs.  For those of us who work with assisted housing or low-income families, its findings are unfortunately not a big surprise.  However, it underscores the significant unmet needs of so many low-income families.

The Senate Committee on Appropriations unanimously voted on July 27, 2017 to approve its FY2018 Transportation, Housing and Urban Development (THUD) bill.  The bill eliminates the cap in the Rental Assistance Demonstration (RAD) program, which has been supported by Secretary Carson, and also removes RAD’s sunset date.  In addition to the advancements in RAD, some additional rental assistance highlights of the bill include:

  • Increase in tenant-based Section 8 vouchers to $21.365 billion ($1.07 billion above the FY2017 enacted level);
  • Increase in public housing funding to $6.45 billion ($103.5 million above the FY2017 enacted level);
  • Increase in project-based Section 8 to $11.5 billion ($691 million above the FY2017 enacted level);
  • Increase in Housing for the Elderly to $573 million ($70.6 million above the FY2017 enacted level); and
  • Increase in Housing for Persons with Disabilities to $147 million for  (nearly $1.0 million above the FY2017 enacted level).

The Senate Committee on Appropriations released an overall summary of the bill that can be found here.  Unlike the drastic cuts seen in the House’s THUD bill, the Senate’s bill delivers increased overall funding of $60.058 billion ($3.5 billion higher than the House). This funding level represents an increase of $2.407 billion over current levels.  While many speculate neither the Senate nor the House will move their respective THUD bill to the floor, the Senate’s funding levels represent a step in the right direction for those that rely on many HUD programs.

On June 28, 2017, HUD issued Notice PIH 2017-10 (HA) (the “Notice”) providing guidance on the implementation of the Housing Choice Voucher (“HCV”) program funding provisions of the Consolidated Appropriations Act, 2017 (the “2017 Act”).

Under the 2017 Act, HUD received a total of $20,292,000,000 in funding for the Housing Choice Voucher program for the following budget items:

  • HAP Renewal Funding ($18,355,000,000)
  • Tenant Protection Vouchers ($110,000,000)
  • Administrative Fees ($1,650,000,000)
  • Mainstream 5 Year Program (120,000,000)
  • Tribal HUD-VASH Renewals ($7,000,000)
  • Veterans Affairs Supportive Housing ($40,000,000)
  • Family Unification Program ($10,000,000)

As evidenced in the Notice, the allocation methodology used to calculate housing assistance payments renewal funds, new incremental vouchers and administrative fees mostly continues the methodology established under the 2016 Consolidated Appropriations Act. We have highlighted some notable differences and new requirements below:

  1. The 2017 Act provides funding for Tribal HUD-VASH Renewals and the Family Unification Program. Per the Notice, further guidance for both programs will be issued at a later date. Guidance for the Tribal HUD-VASH Renewals will come from the Office of Native American Programs and a NOFA will be published directing the use of the Family Unification Funding.
  2. HUD is estimating that the $75 million dollar set-aside of HAP Renewal Funding will be necessary to prevent the termination of rental assistance for families as a result of insufficient funding of the voucher program. Applications for the other categories of set-aside funding: Unforeseen Circumstances, Portability Cost Increases, Project-Based Vouchers and HUD-VASH will not be accepted, unless there are remaining set-aside funds. The applications for shortfall funding will remain open throughout 2017, however PHA’s already within a Shortfall Protection Team with confirmed shortfalls in September, October or November of 2017 must submit an application no later than 5:00pm EST, Friday July 28, 2017 and those with confirmed shortfalls in December 2017, should submit an application no later than 5:00pm EST, Monday, January 22, 2018.
  3. The Tenant Protection Voucher set aside has also been increased to provide funding up to $110,000,000 to assist certain at-risk households in low-vacancy areas, who pay rents above 30% AMI as a result of certain conditions. The Notice clarifies that these TPVs are considered replacement vouchers and are not subject to the same re-issuance restrictions that apply to relocation vouchers. HUD noted that further guidance on the TPV set-aside is forthcoming and that until it is issued; HUD will not consider any applications for TPV set-aside funding.
  4. Section 6 of the Notice also provides significant detail on the process for awarding and applying for TPVs. It also explains under what circumstances tenants may be eligible for such vouchers.
  5. With respect to Administrative Fees, the Notice clarifies that no additional request may be made after the June 23rd deadline for Blended Rate Administrative Fees and Higher Administrative Fee Rates.

We will keep you posted as additional guidance is issued for these programs.

At the National Housing Conference 2017 Annual Policy Symposium on June 9, 2017, HUD Secretary Ben Carson delivered the keynote address and participated in a Q&A session with Chris Estes, President and CEO of NHC.  While much of the keynote address focused on homeownership issues, remarks made during the Q&A included such topics as the Rental Assistance Demonstration (RAD) program, Housing First, veterans housing, rural housing, fair housing, and the Federal Housing Administration. 

With respect to RAD, the Secretary called it the “perfect example” to leverage funds to provide more affordable units through public private partnerships.  He called for the lifting of the RAD cap on units (currently 225,000 units), as he described the program as a “win win situation” in the context of spreading funds further in light of fiscal constraints.  In emphasizing “enhancing public private partnerships,” the Secretary specifically mentioned the use of low-income housing tax credits.   

A recording of the Secretary’s remarks can be found here.  Remarks relating to RAD can be found beginning at time stamp 12:42 and also at 21:47.

 

 

The new HUD administration has been pretty quiet on the regulatory front, with only a handful of regulations and notices issued since January. That may change soon. HUD is hard at work identifying regulatory changes that might be made to comply with Executive Order (EO) 13771, “Reducing Regulation and Controlling Regulatory Costs.”  The EO requires that two regulations be eliminated for each new regulation issued and that the overall costs of new regulations, including repealed regulations, this year be zero. In February 2017, the Office of Management and Budget issued guidance for implementing the EO, and now HUD  seeks the public’s input into which regulations it could modify or eliminate.  Recommendations are due June 14, 2017.

Over the years, a number of groups and agencies have submitted recommendations to HUD for regulatory reform, and this is a good time to reconsider those proposals.  Since the request is for modifications to regulations, not statutes, recommendations should focus upon regulations and guidance that is not required by federal law.  Areas Ballard Spahr has been thinking about recommending changes include:

  • Better ways to implement prevailing wage rate requirements at mixed-use projects where the prevailing wages need not be paid for the full project;
  • Streamlining of the demolition/disposition process for public housing;
  • Modifications to site and neighborhood standards;
  • Modification of the public housing asset management rules;
  • Requirements for designation of public housing as elderly-only; and
  • Thoughtful modifications to affirmatively furthering fair housing requirements.

Earlier in May, HUD received approval from the Office of Management and Budget of the final, revised form RAD documents. HUD had previously solicited two rounds of public comment as part of the Paperwork Reduction Act process.  Ballard’s comments to HUD’s first solicitation of comments can be found here and our comments to the second round here. The final, revised form documents reflect HUD’s incorporation of many of the submitted comments – including comments received as part of the second round of public comment in October 2016.

The May 11th RADBlast! indicates that the revised forms must be utilized for any closing package submitted to HUD on or after June 1, 2017. Many of the revised RAD documents are available in Word format on HUD’s RAD website and both the old and new forms are available on the RAD Resource Desk. For the convenience of our readers, we’ve uploaded copies of the final, revised forms for public housing RAD conversions (RAD First Component) compared to the prior form documents – and you’ll immediately notice the riders to RAD Use Agreement and the HAP Contracts have been incorporated into the body of the respected documents:

If you’ve been following the progression of the revised RAD documents and would like to see the changes made to the documents since they were published for comment in October 2016, please contact me (mohra@ballardspahr.com or 410.528.5337)  and I will be happy to send you comparison copies of these interim revisions.

Overall, HUD was receptive to stakeholder comments and the revised documents reflect the collective knowledge gleaned over the last five years. We look forward to continuing to advance the RAD program.