Redevelopment

HUD Publishes 2024 OCAFs

~ Tushar Gurjal ~ Leave a comment

On Nov. 30, HUD published a notice in the Federal Register titled “Notice of Certain Operating Cost Adjustment Factors for 2024.” Operating cost adjustment factors (OCAFs) are annual factors used to adjust certain Section 8 rents. These OCAFs are calculated as “the sum of weighted component cost changes” for certain publicly available cost indices.

Some indices reflect data collected at the state level, while some indices reflect data collected at the national level. The nine cost indicators used in calculating OCAFs are the following:

  • State-level data;
    • Electricity;
    • Fuel Oil;
    • Natural Gas;
  • National-level data;
    • Employee Benefits;
    • Employee Wages;
    • Goods, Supplies, and Equipment;
    • Insurance;
    • Property Taxes; and
    • Water, Sewer, and Trash.

The notice lists the specific data sources for each category of data and alternative sources where a region may not have specific data available.

The full notice with the 2024 OCAFs listed as an appendix can be found here.

New Subsidy Layering Review Notice Published

~ Tushar Gurjal ~ Leave a comment

In mid-March, HUD published a new notice titled “Administrative Guidelines: Subsidy Layering Review for Project-Based Vouchers” in the Federal Register. The new notice provides background information about what subsidy layering reviews (SLRs) are; it provides information about when SLRs are needed and applicable safe harbor standards; it discusses the potential role of Housing Credit Agencies; and provides other miscellaneous information, including an appendix with the required elements of an SLR application, which may also serve as a checklist.

HUD mandates that SLRs are performed when project-based vouchers (PBVs) are used in conjunction with other subsidies to ensure that projects are not overly subsidized. This mandate is not applicable to existing housing.

When a PHA begins a new construction or rehabilitation that requires PBVs, it is required to request that an SLR be completed in certain instances. The PHA is responsible for collecting the appropriate documentation.

There are certain safe harbor requirements in SLRs. When a project falls within the scope of these safe harbors, and HUD is conducting the SLR, the project may move forward without additional justification. If the project falls outside the safe harbors, then additional documentation and justifications are required. If a housing credit agency (i.e., a state housing finance agency; HCA) is performing the SLR, the safe harbor requirements may only be exceeded if costs outside the safe harbor still fall within the HCA’s published qualified allocation plan.

A PHA may not execute an Agreement to Enter Into a Housing Assistance Payments Contract (AHAP) until the SLR has been completed and approved by either HUD or the HCA, depending on the circumstance. The chart below reviews project scenarios and potential entities, if any, that may perform the SLR.

ScenarioSLR ReviewerNo additional government funding certification required?
New construction or rehabilitation with PBV funding and 2 or more forms of government assistance.HCA or HUD.*If by HCA, no certification required. If by HUD, then HUD certifies.
New construction or rehabilitation with PBV and Low-Income Housing Tax Credit (LIHTC) funding.HCA or HUD.If by HCA, no certification required. If by HUD, then HUD certifies.
PBV existing housing.No SLR required.No.
New construction or rehabilitation with only PBV assistance.No SLR required.No.
Mixed-finance projects, with or without LIHTC, with or without PBV assistance, with other forms of government assistance.HUDYes.
*PHAs may request that HUD perform the SLR if the project does not use LIHTCs.

The full notice can be found here.

Administration Announces Housing Supply Action Plan

~ Tushar Gurjal ~ 1 Comment

On May 16, the administration announced a housing supply action plan that is intended to “ease the burden of housing costs over time, by boosting the supply of quality housing in every community.” The plan includes both legislative and administrative actions and is meant to align with other policies currently in effect (e.g., federal rental assistance) to create more affordable rents and make homeownership more affordable.

While the plan includes many specific actions, many of those actions can be grouped into the following categories.

  • Incentivizing jurisdictions to reform their zoning and land-use policies by giving higher scores to jurisdictions that do this in federal grant allocations.
  • Implementing new financing mechanisms to build and preserve housing, including manufactured housing; accessory dwelling units; two to four unit properties; and other multifamily buildings.
  • Improving existing federal financing for development and preservation, which includes making construction to permanent loans more available; promoting the use of COVID recovery funds for affordable housing; reforming the low-income housing tax credit and the HOME program.
  • Ensuring that more housing goes to owners that live in the units or non-profits that will rehabilitate them.
  • Addressing supply chain issues by working with the private sector.

The White House’s full announcement of their housing supply action plan can be found here.

New Guidance on Asset-Repositioning Fee Eligibility

~ Tushar Gurjal ~ Leave a comment

On Dec. 21, HUD published a notice titled “Guidance on Eligibility for Asset-Repositioning Fee (ARF)” (PIH 2021-37). This guidance is for PHAs that are demolishing or disposing public housing units. It details instances when a PHA may be eligible for an Asset-Repositioning Fee (ARF), which helps PHAs manage costs related to the “administration of demolition and disposition [actions], tenant relocation, and minimum protection and services associated with such efforts.” This notice replaces Notice PIH 2017-22. It makes two major changes: 1) including ARF eligibility for projects a PHA demolishes in accordance with de minimis demolition authority; and 2) eliminating ARF eligibility for units sold or projects transitioned to homeownership under a homeownership plan.

Housing agencies must ensure that data related to ARF in the Public and Indian Housing Information Center (PIC) is accurate. If the data in PIC is not accurate, the notice provides information on revising it within the system.

The notice provides guidance on which projects, or entire buildings, are eligible for ARFs and which are not. In general, those units that are eligible are projects that are approved for section 18 demolition or disposition, projects approved for demolition pursuant to a HOPE VI or Choice Neighborhoods plan, and projects slated for demolition through certain de minimis demolition authority. Ineligible projects include Rental Assistance Demonstration (RAD) conversions; voluntary conversions; certain retentions of units; units that have reached the end of their ARF timeline, but remain under an annual contributions contract; mixed-finance modernization projects; projects sold pursuant to an approved homeownership plan; and projects removed from inventory through a combined process of ARF eligible methods and ineligible methods (e.g., blended RAD conversions incorporating demolition and disposition funds).

Eligible agencies must follow the ARF timeline discussed in the notice. The ARF timeline begins “on the first day of the next quarter six months after the date the first unit becomes vacant after the relocation date included in the approved relocation plan.” The notice provides additional information and detail on the timeline, including a chart visually depicting it. Additionally, there is guidance on how to properly report units that have not been removed from inventory, but are eligible for ARFs.

Finally, the notice provides additional information on the financial side of ARFs. This includes information on how to calculate ARFs (including the needed documentation), the length of the ARF funding period and its relationship with the operating subsidy funding year, information on demolition or disposition actions with different relocation dates, and information on when ARF-eligible units are no longer eligible for other operating fund add-ons and how the rolling base is recalculated.

The full notice may be found here.

New Video for Public Housing Residents on the RAD Process

~ Tushar Gurjal ~ Leave a comment

HUD has published a new video that explains the Rental Assistance Demonstration (RAD) program to public housing residents. The purpose of the video is to explain the program in an accessible way. HUD encourages housing agencies and property owners impacted, or soon-to-be impacted, by the RAD program to show the video at resident meetings, share the video with resident associations, and upload it to the agencies’ or owners’ websites.

The video can be found above or in the “How Does RAD Impact Me?” subsection of their website.

House Passes $1.75 Trillion Build Back Better Plan

~ Georgi Banna ~ Leave a comment

House Takes Steps Toward Historic Housing Investments

The largest single housing investment in American history took a monumental step forward this morning, passing the House by a narrow 220-213 margin. The Build Back Better Act now moves to the Senate for further consideration. 

NAHRO led the fight to fully fund the Public Housing Capital Fund backlog at $70 billion, strongly championed the expansion of the Low-Income Housing Tax Credit, and ardently supports the increase in Housing Choice Vouchers and Project-Based Rental Assistance contracts.  

NAHRO members – thank you for raising your voices in support of affordable housing! The more than 50,000 letters you sent to Congress and the White House this year, maintained the spotlight on housing as infrastructure and made sure the critical housing provisions remained in the Build Back Better bill. But the fight isn’t over yet! Be ready to speak out after Thanksgiving to preserve housing in the bill as it moves to the Senate.  

The vote was originally scheduled for Thursday night, but an extended floor speech by Minority Leader Kevin McCarthy (R-CA) delayed the final vote. Build Back Better passed along party lines, with a single Democrat opposing.  

The path forward is not clear in the Senate, as several Democratic Senators have issues with several provisions. Negotiations are expected to heat up after Thanksgiving, aiming for a final vote in the Senate by Christmas. Though there is widespread support for the housing provisions in Build Back Better, it is possible that changes to the bill could put the housing investments at risk. If the bill is approved by the Senate, it is likely to go back to the House for another vote. 

NAHRO member advocacy will be needed to ensure these critical housing resources remain in the Build Back Better bill as it is debated in the Senate. NAHRO will be reaching out to you through future Direct News emails and also follow NAHRO on social media (Twitter, Instagram, Facebook, Linkedin) for the latest information. 

The bill currently proposes the largest one-time investment in housing and community development programs ever, including: 

  • $65 billion for Public Housing investments 
  • $24 billion for Housing Choice Vouchers 
  • Expanded Low-Income Housing Tax Credits 
  • $15 billion for the National Housing Trust Fund 
  • $10 billion for the HOME Investment Partnerships Program 
  • $3 billion for Community Development Block Grants 
  • $1 billion for Project-Based Rental Assistance 
  • $450 million for Section 811 Supportive Housing for People with Disabilities 
  • $450 million for Section 202 Supportive Housing for the Elderly 

Want more information? Check out NAHRO’s detailed breakdown of the bill’s housing provisions. 

OSHA Releases Vaccine and Testing Mandate for Large Employers

~ Georgi Banna ~ Leave a comment

On Nov. 4, the Department of Labor’s Occupational Safety and Health Administration (OSHA) released its vaccine mandate for businesses with 100 or more employees. It is scheduled to be published in the Federal Register tomorrow, Nov. 5, and will take effect immediately. Covered employers have 30-days (by approximately Dec. 5) to become compliant and implement a vaccine and mask mandate and unvaccinated employees must be in compliance with weekly testing requirements within 60-days (by approximately Jan. 4).

A pre-publication copy of the Emergency Temporary Standard (ETS) on COVID-19 Vaccination and Testing can be found here. The majority of the ETS provides background, justification, description; and the last section lists the regulatory updates and additions. While the full document is 490 pages, the regulation itself is much shorter and can be found on page 473.

The purpose of the ETS is to protect unvaccinated employees of large employers from the risk of contracting COVID-19 by strongly encouraging vaccination. Covered employers must develop, implement, and enforce a mandatory COVID-19 vaccination policy, with an exception for employers that adopt a policy requiring employees to either get vaccinated or elect to undergo regular COVID-19 testing and wear a face covering at work in lieu of vaccination.

Unvaccinated employees would need to wear a mask indoors or in vehicles with employees at all times except when alone in a room with floor to ceiling walls or windows and a closed door. There is no mask requirement for vaccinated employees.

At this time the ETS only applies to employers of 100 or more employees, however OSHA is continuing to discuss whether or not this should apply to smaller employers.

NAHRO will continue to follow OSHA’s Emergency Temporary Standard on COVID-19 Vaccination and Testing, and will share additional information as it becomes available.

Eviction Moratorium to Expire Saturday; NAHRO Urges Extension

~ Georgi Banna ~ Leave a comment

Despite efforts from House Democratic leaders to extend the federal eviction moratorium, which expires Saturday, July 31, no vote was issued to extend the order as of Friday afternoon. Earlier this week, House Speaker Nancy Pelosi (D-Calif.) publicly advocated for the Biden administration to act unilaterally to protect renters at risk of eviction due to the ongoing coronavirus pandemic.

About 11 months ago, the Centers for Disease Control and Prevention (CDC) enacted the federal eviction moratorium to prevent the spread of the deadly virus among families and individuals that could be at high risk if made homeless through eviction. The public health measure has been extended on several instances, with the last extension made in June. The moratorium offered uniform protections to renters across the nation.

With the COVID-19 delta variant surging across the nation, now is not the time to put vulnerable families at risk by ending the eviction moratorium. NAHRO calls on Congress and the Administration to extend the moratorium through at least the end of September 2021.

Whether or not the eviction moratorium expires, NAHRO’s housing agency members remain committed to using every available resource to keep as many people in their homes as possible. Nationwide, NAHRO members continue to work with their residents and with local and national partners to provide support and aid – especially to those who have been most impacted by the pandemic. We are continually looking for new and better ways to help.

The Emergency Rental Assistance Program is a vital and cost-effective tool to help people stay in their homes. As Treasury, HUD, and state and local entities work to distribute these much-needed funds as quickly as possible, we also look forward to the passage of a robust FY 2022 HUD budget and additional housing resources that will further help to provide the safety and stability of a home to all who need it.

NAHRO Interim CEO Mike Gerber statement on extending the eviction moratorium and quickly distributing Emergency Rental Assistance Program funds.

As more information is released on the status of the eviction moratorium, NAHRO will continue to provide updates.

Sec. Fudge Announces New Effort to Address Reentry Housing Needs

~ Claire Salant ~ Leave a comment

Secretary Fudge issued new guidance yesterday clarifying that citizens returning from jail and/or prison and at risk of homelessness are eligible for Emergency Housing Vouchers.

In a letter sent out to PHAs, Continuums of Care, and HUD grantees, Sec. Fudge wrote that “HUD strongly encourages PHAs to work with their Continuum of Care (CoC) partners to ensure that individuals who are at-risk of homelessness after leaving prisons or jails are considered for these vouchers.”

HUD has eliminated permissive prohibitions for drug-related criminal activity for EHVs, since drug addiction can be a root cause of homelessness. Following a Housing First approach, it now recommends considering drug-related prohibitions to be separate from prohibitions on criminal activity against a person. HUD also no longer requires a “one strike” rule for residents for criminal activity, and instead defers to discretion of landlords and PHAs. More detail on criminal records and eligibility for EHVs can be found here.

Beyond EHVs, more guidance on criminal records in accordance with the Fair Housing Act can be found here. PHAs and federally-assisted housing cannot use arrest records as the basis to deny admission, terminate assistance, or evict residents.

HUD plans to issue future guidance and tools for PHAs and private landlords on tenant screening and best practices on reentry housing. Later this month it will also issue guidance on using Community Development Block Grants on community violence intervention (CVI).

HUD Updates Demolition and Disposition Notice

~ Tushar Gurjal ~ Leave a comment

Earlier today, HUD published PIH 2021-07, titled “Demolition and/or disposition of public housing property, eligibility for tenant-protection vouchers, and associated requirements.” This notice updates PIH 2018-04, which was the prior demolition and disposition notice.

The new notice makes several non-substantive and substantive revisions to the prior notice. Non-substantive revisions include clarifying headings, adding spacing between paragraphs, re-numbering paragraphs, and correcting citations to regulatory provisions, which make for a clearer document. Substantive changes in this notice include the following:

  • HUD’s Special Applications Center (SAC) no longer claims to return a SAC application that is substantially incomplete or deficient, while informing a PHA of its deficiencies (previously, SAC would “return” the application by changing the status of the application to DRAFT in the Inventory Management System/PIH Information Center [IMS/PIC]);
  • The Department clarifies that PHAs must not just make resident consultation accessible, but rather that “PHAs must ensure that communications and materials are accessible to individuals with disabilities and take reasonable steps to provide meaningful access to persons with Limited English Proficiency (LEP)”;
  • Use of proceeds is no longer a material term of the SAC application, so if a PHA’s plan on the use of proceeds changes after HUD approval of an application, a PHA would no longer have to request an amendment to the application;
  • Includes new RAD/Section 18 blends;
    • RAD/Section 18 Construction Blend – the percentage of units eligible for disposition is based on hard construction costs for new construction or rehabilitation of the covered project. Transactions that use the 9 percent Low-Income Housing Tax Credit are not eligible.
      • If hard construction costs equal 90 percent of the Housing Construction Costs (HCC) as published by HUD for a given market area, the PHA may dispose of up to 60 percent of the units of the converting project under Section 18;
        • For high-cost areas (HCC exceeds 120 percent of the national average), a PHA may dispose of up to 80 percent of the units of the converting project under Section 18;
      • If the hard construction costs equal or exceed 60 percent, but are less than 90 percent, of HCC, the a PHA may dispose of up to 40 percent of the units of the converting project under Section 18;
      • If the hard construction costs equal or exceed 30 percent, but are less than 60 percent, of HCC the PHA may dispose of up to 20 percent of the units of the converting project under Section 18;
    • RAD/Section 18 Small PHA Blend – for any PHA with 250 or fewer public housing units under its Annual Contributions Contract (ACC), up to 80 percent of the units in a converting project may be disposed of under Section 18;
  • The Department clarifies that tenant-protection voucher (TPV) requests first go to the field office for a threshold review before being sent to HUD’s Financial Management Division (FMD), while HUD’s Financial Management Center (FMC) notifies PHAs of the final TPV awards.

The full notice can be found here.