HUD Releases Notice on RAD Cap Increase and Rent Setting

Tomorrow, August 23, HUD will release a Notice in the Federal Register increasing the unit cap for the Rental Assistance Demonstration (RAD) and setting rents for units accepted under the increase. The FY 2017 enacted budget expanded the 185,000 unit cap on Public Housing conversions to 225,000 units and changed the September 30, 2018 deadline for submission of RAD applications under the first component to September 30, 2020.

PHAs that have already submitted Letters of Interest (LOI) to reserve their position on the RAD waiting list are eligible for award under the expansion if the PHA submits a complete RAD Application, Portfolio Award, or Multi-phase Award for the number of units identified in their LOI within 60 days of publication of the Notice.

HUD will use rent levels based on the FY 16 RAD rent base year for CHAPs issued beyond the 185,000-unit cap and for any replacement awards made as a result of revocations or withdraws that occurred after May 5, 2017. HUD will use rent levels based on the FY 14 RAD rent base year for replacement awards made under the 185,000-unit cap as a result of revocations or withdraws that occurred prior to May 5, 2017.

PHAs that are issued Multi-phase Awards after May 5, 2017 will have until September 30, 2020 to submit an application for the final phase of the project. HUD may approve extensions up to September 30, 2020 for Multi-phase Awards made prior to May 5, 2017 on a case-by-case basis.


HUD Study Finds Small Area FMRs Have Mixed Results

Last week, HUD published a report titled “Small Area Fair Market Rent Demonstration Evaluation: Interim Report,” which provides preliminary findings from HUD’s Small Area Fair Market Rent (FMR) Demonstration. The Small Area FMR Demonstration is a Demonstration of seven PHAs that have implemented Small Area FMRs in a variety of housing markets to test their effectiveness. The potential adverse impacts to Housing Choice Voucher (HCV) program participants that this report identifies is one of the reasons that HUD suspended implementation of mandatory Small Area FMRs.

While NAHRO is still in the process of reading through and analyzing the report, the key takeaways from it on the imposition of Small Area FMRs are the following: different housing markets are impacted differently; there are more families moving into areas of opportunity; there is a loss of affordable units; and there is an aggregate higher cost burden for families.

The evaluation looks at the effects of Small Area FMRs on 1) potential access to opportunity; 2) actual access to opportunity; and 3) costs and rents. Additionally, the study looks at costs to PHAs. Click below for a brief summary of the evaluation findings.

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