Multifamily Industry Meetings: San Francisco
United States Department of Housing and Urban Development
San Francisco Multifamily Hub Industry Meeting
April 16, 2015
|10:00 - 10:05 AM
||Welcome and Introduction
||Davin Lal, Project Manager
|10:05 - 10:15 AM
||1. Multifamily Update and Introduction of New Staff
||Alexa Jeffress, Director of San Francisco Asset Management Division
|10:15 - 10:25 AM
||2. General Updates from Asset Management
||Martha Picasso, Project Manager
|10:25 - 10:30 AM
||3. Data Systems Reminder with a Question and Answer Session
||Bob Dutra, Information Specialist Supervisory Project Manager
|10:30 - 11:00 AM
||4. Notice H2015-02, Required Actions for Projects Receiving Failing Real Estate Assessment Center Scores
||Danny Dadios, Under 60 Coordinator
|11:00 - 11:05 AM
||5. Management Fee Add On And Project Assisted Clean Energy (PACE)
||Paul Williams, Project Manager
|11:05 - 11:50 AM
||6. Affirmative Fair Housing Marketing Plans
||Jeff Jackson, Supervisory Equal Opportunity Specialist
|11:50 - 11:55 AM
||7. Industry Announcements
|11:55 - 12:00 PM
||8. Closing Remarks
||Davin Lal, Project Manager
Notice 2013-25: Updated Guidelines for Continuation of Interest Reduction Payments After Refinancing: "Decoupling," as allowed by the National Housing Act, under Section 236(e)(2)
- Applies to Section 236 projects being refinanced.
- "Decoupling" means severing Interest Reduction Payment (IRP) assistance from original Section 236 mortgage.
- When qualifying Section 236 project is being refinanced, Interest Reduction Payment (IRP) subsidy may continue provided owner enters into new Interest Reduction Payment (IRP) Agreement and Use Agreement. Use Agreement must have term 5 years longer than IRP term.
- Supersedes Notice H 2000-08 EXCEPT with regard to Section 236(b) transactions.
- Applies to multifamily projects receiving Interest Reduction Payment (IRP) under Section 236, including (1) all projects with mortgages insured or held by Department of Housing and Urban Development (HUD); and (2) all State Agency non-insured projects.
- Does not apply to former Section 236 projects currently or previously owned by housing and urban development (HUD).
- Applies to Section 236 Basic and Market rent computations during Decoupling Use Agreement term, and to allowable distributions during Interest Reduction Payment (IRP) Agreement term.
- Provides updated policy on requirements for Section 236(e)(2) decoupling.
- Describes requirements related to refinance of formerly Decoupled projects.
- Total funding of Interest Reduction Payment (IRP) may not exceed total amount of Interest Reduction Payment (IRP) established for original Section 236 mortgage. If new Interest Reduction Payment (IRP) schedule provides lower monthly payments, or payments are suspended during rehabilitation period, term may be longer.
- Use Agreement must ensure provision of low income housing for a period 5 years longer than term of Interest Reduction Payment (IRP) assistance and be recorded in first position.
- IRP assistance is paid to mortgagee on behalf of mortgagor, not directly to Owner.
- Oversight must be provided by an acceptable public agency, or if not available, by Housing and Urban Development (HUD).
- Original Section 236 requirements must be maintained after Decoupling. Basic and Market rents are mandatory rent payment standards. Occupancy and habitability standards, income limits, financial reporting, payment of any Excess Income to housing and urban development (HUD), Fair Housing, accessibility, marketing, waiting list, and physical requirements must also be maintained.
- If there is a Section 8 project-based Housing Assistance Payment (HAP) contract in place, Owner must execute 20 year Renewal Contract, including a "Preservation Exhibit". The Renewal Contract must be executed at or before prepayment/decoupling closing. (Section 2-8 of Section 8 Renewal Guide requiring that Use Agreement be extended to term of Housing Assistance Payments (HAP) contract is not applicable.)
- Mortgagee may be any corporate entity not suspended or debarred from doing business with the Department of Housing and Urban Development (HUD).
- Mortgagors must be entities that are eligible to own multifamily properties and meet the Department of Housing and Urban Development (HUD) requirements for acceptable ownership and management.
- Eligible projects: Any insured, non-insured or the Department of Housing and Urban Development (HUD)-held Section 236 project. Preservation Projects Low Income Housing Preservation and Resident Homeownership Act (LIHPRHA) and Emergency Low Income Preservation Housing Act (ELIPHA) may only participate if there is no rent increase.
- If change of ownership is proposed, proposed buyer must be approved through Active Partners Performance System (APPS) /2530 procedures, and have approved management plan, management agent (if applicable), and Affirmative Fair Housing Marketing Plan.
- If sale involves Low Income Housing Tax Credits, see Section 8 of this Notice.
- If project is being sold by nonprofit, see Housing Notice 2011-31 as well as this Notice.
- To extent feasible and consistent with long-term preservation, all outstanding Department of Housing and Urban Development (HUD) debt must be repaid under proposed transaction.
- Decoupling proposals may include a request for increased distributions. See Section 13 of Notice.
- Relocation requirements are included in Section 23 of Notice.
- If efficiency unit conversions are desired, Department Housing and Urban Development(HUD) current unit conversion policy (Housing Notice-2011-030) applies.
Notice 2014-07 - Funding for Tenant-Protection Vouchers for Certain At-Risk Households in Low-Vacancy Areas - 2014 Appropriations Act
- Issued 5/20/2014 to provide instructions, eligibility, and selection criteria on funding process for tenant protection vouchers (TPVs) for certain at-risk households in low-vacancy areas
- Protects tenants in low-vacancy areas who have to pay rents greater than 30 percent of household income as a result of: maturity of the Department of Housing and Urban Development (HUD)-insured, Department of Housing and Urban Development(HUD)-held or Section 202 loans that require permission of the Department of Housing and Urban Development(HUD) prior to loan prepayment; expiration of rental assistance contract for tenants not eligible for enhanced voucher or protection assistance under existing law; and expiration of affordability restrictions accompanying mortgage or preservation program
- Applies to mortgage maturities or affordability restriction expirations that took place in Fiscal Year 2014 or prior to Fiscal Year 2014 but any funding leftover after all eligible properties' requests have been funded may be carried over to the next fiscal year that occur after Fiscal Year 2014
- Questions concerning the Notice should be directed to the Housing Voucher Management and Operations Division, Office of Public Housing and Voucher Programs at (202) 708-0477
Notice 2014-12 - Implementation of Tenant Participation Requirements in accordance with 24 Code of Federal Regulation (CFR) Part 245
- Notice issued 9/4/2014 and supersedes notice 2012-21
- Adds procedures for tenants to appeal findings of complaints filed with the Hub/Program Center; addresses available sanctions and use of civil money penalties to enforce the Department of Housing and Urban Development(HUD's) commitment to tenant participation
- Applies to owners of multifamily housing project that are:
- Subject to the Department of Housing and Urban Development(HUD) insured or Department of housing and Urban Development (HUD)- held mortgage
- Formerly Department of Housing and Urban Development (HUD)-owned
- State or local housing finance agency projects
- Receiving project-based assistance under Section 8; enhanced vouchers under Low-Income Housing Preservation and Resident Home Ownership Act of 1990
- Receiving assistance under Section 202 Direct Loan Program/Supportive Housing for Elderly Program; assistance under Section 811 Supportive Housing for Persons with Disabilities Program and
- Cooperative mortgagors not subject to provisions of 24 Code Enforcement Regulation (CFR) 245 Part B
- Right of tenants to organize is provided in the brochure entitled "Resident Rights and Responsibilities"
- Protected activities include: distributing leaflets, initiating contacts with tenants, offering assistance for tenant participation, and convening tenant organization meetings on-site independent of management representatives
- Tenants have a right to be notified of and to formulate responses to budget-based rent adjustments, partial payment of claims, utility conversions, reduction in utility allowances, unit conversions to non-residential use, cooperative housing or condominiums, major capital repairs and loan prepayments
- Owner/agents must make space available for appropriate meetings of tenants and may charge a reasonable fee approved by Department of Housing and Urban Development (HUD) and received into the project operating account. Owner may elect to waive fee.
- Impediments to resident and resident organizations to exercising their rights are contained in the Department of Housing and Urban Development (HUD) Handbook 4381.5 (revision-2) Management Agent Handbook, Chapter 4.
- Owners and Agents who violate provisions of 24 Code Enforcement Regulation (CFR) Part 245 may be liable for debarment, suspension, limited denial of participation, and civil money penalties.
- Tenants and tenant organizations may file a written complaint with local the Department of Housing and Urban Development(HUD) office alleging pattern of violations including factual evidence
- Department of Housing and Urban Development (HUD) will bring parties together to attempt conciliation; conduct a thorough investigation and issue a determination of "no reasonable cause" if no violation occurred
- If there are violations, Department of Housing and Urban Development (HUD) will issue a notice requiring correction within 30 days
- If owner fails to respond, the Department of Housing and Urban Development (HUD) will send request for an elective referral to the Department Enforcement Center in Los Angeles, California and flag the owner in Active Performance Partners System (APPS).
- Disagreements and requests for reconsideration should be directed to Office of Asset Management in Department of Housing and Urban Development (HUD) headquarters.
Notice 2014-14 - Transferring Budget Authority of a Project-Based Section 8 Housing Assistance Payments Contract under Section 8(bb)(1) of the United States Housing Act of 1937
- Notice defines procedures for transferring all or a portion of any remaining budget authority of a project-based Housing Assistance Payment (HAP) Contract to one or more contracts under Section 8(bb)(1) of the United States Housing Act where the existing Housing Assistance Payment (HAP) contract is terminated by mutual agreement.
- Transferring project may either terminate all subsidy, or subdivide their existing contract and retain a portion. Receiving project(s) may amend an existing contract to include new units/budget authority, or execute a new contract if no contract already in place.
- Both parties must agree to transfer/receive the subsidy and comply with all notice requirements.
- Units to which the subsidy is being transferred must be in existence and ready for occupancy before authority can be transferred. Projects under construction are not eligible; conditional approval (i.e. comfort letter) may be provided for new construction projects, but transfer cannot occur until certified full occupancy.
- Department of Housing and Urban Development (HUD) has no statutory authority to increase budget authority; proposed units must be able to be sufficiently funded with existing authority. Number of units funded may differ from those at previous project.
- Transferring owner must demonstrate that tenants will not be adversely affected. Tenants may relocate to another unit in sending project or to the receiving property or receive Tenant Protection Vouchers (TPVs) if eligible and do not relocate. Owners are responsible for tenant relocation expenses. Tenant notice and 30 day comment period required.
- Receiving property must demonstrate to Department of Housing and Urban Development (HUD) the need for affordable housing, supported by documentation, including waiting lists, market analysis, etc.
- Department of Housing and Urban Development (HUD) Multifamily will review the initial submission; submission also reviewed by Department of Housing and Urban Development (HUD) Policy Development and Research (PD and R) economist to confirm that there is sufficient demand in the receiving market and not transferring to an area with "highly concentrated poverty." Upon approval, Hub will make a recommendation to Department of Housing and Urban Development (HUD) headquarters for final approval.
- Property receiving the subsidy will be subject to all relevant Department of Housing and Urban Development (HUD) requirements, including physical condition inspections and financial reporting standards.
- Receiving owner must agree to terminate the amended contract and immediately execute a new 20-year contract with Preservation exhibit.
- Both projects must be in good standing with all department of housing and urban development (HUD's) compliance requirements (Fair Housing, Management and Occupancy Review (MORs), Real Estate Assessment Center (REAC), Financial Assistance Subsystem (FASS) , and all other systems) and must demonstrate that they will remain financially viable after transfer.
- Budget authority remaining depends on where the contract is in its funding year. For Owners with pre- Multifamily Affordable Housing Reform and Affordability Act (MAHRA), Housing assistance payments (HAP) contracts still in their original term, budget authority is the amount of original obligation remaining.
- Certain projects will be handled on a case-by-case basis, and will be subject to different eligibility rules: example. Mark to Market, Rental Assistance Demonstration (RAD). http://portal.hud.gov/hudportal/documents/huddoc?id=14-14hsgn.pdf
Notice 2014-15 - Passbook Savings Rate Effective February 1, 2015 and Establishing Future Passbook Savings Rates
- Notice issued 10/31/2014 and effective on 2/1/2015 establishing passbook savings rate used to determine annual income from net family assets; replacesprevious rate of 2% with national average rate provided by the Federal Deposit Insurance Corporation
- Applies to Project-based Section 8, Rent Supplement, Project Assistance Payment(PAC's), Project Rental AssistanceContract (PRACs), Senior Preservation Rental Assistance Contracts (SPRACs), Project Rental Assistance (PRAs), Section 236, Rental Assistance Payments(RAP) and Section 221(d)(3) below market interest rates (BMIR) projects
- Supersedes information in 4350.3 Section 5-7.F; owners should refer to this Notice when calculating tenant income and determining appropriate interest rate to impute income from assets
- HUD will publish rate with effective date annually and owners must use new rate for all move-in, initial, annual, and interim certifications concurrent with effected date
- If national average differs during year by at least 2% from published rate, the Department of Housing and Urban Development (HUD) may publish a new rate with effective date to be used in the interim
- Because change in rate may change reported income for individuals with more than $5,000 in assets, tenants are permitted to request an interim recertification
- Effective 2/1/2015, rate for all move-in, initial, annual, and interim re-certifications when family net assets are over $5,000 is .06% until the Department of Housing and Urban Development (HUD) publishes a new passbook savings rate
Notice 2014-16 - Waiting List Administration
- Notice effective on 11/28/2014 provides guidance on waiting list administration for on opening and placing applicants on waiting list, and outreach
- Does not mandate any new practices for owners/agents but provides additional options to further ensure fair housing compliance
- Applies to: project-based Section 8 (new construction, state agency financed, substantial rehab, Section 202/8, Rural Housing Services, Loan Management Set-Aside and Property Disposition), Rent Supplement, Project Assistance Contracts (PACs), Project Rental Assistance Contracts (PRACs), Senior Preservation Rental Assistance Contracts (SPRACs), Project Rental Assistance (PRAs),236 and 236 Rental Assistance Payments (RAP) projects and 221(d)(3) below market interest rate (BMIRs).
- Public notifications of opening waiting list must comply with HUD fair housing requirements, such as adopting suitable means to reach eligible persons with disabilities and limited English proficiency
- Owners must ensure that notices and communications during meetings are effective for persons with hearing, vision and other communication-related disabilities consistent with Section 504
- Meeting sites must be accessible, auxiliary aids and services are provided (such as materials in Braille, audio and large type; sign language interpreters, computer-assisted real time transcription (CART) services, and assistive living devices, etc.
- Department of Housing and Urban Development (HUD) suggests opening waiting lists for longer periods and making applications available ahead of time to create safer and more effective application intake processes
- Physical and online venues to accept applications will also help promote safety and accessibility
Placing Applicants on Waiting List
- If the lottery or other random choice technique is used to place applicants on a previously closed waiting list, the owner must describe the method in the tenant selection plan and in any public notice of a waiting list opening
- Timing of applications submission will have no effect on how soon applicant may be offered assistance
- If not using this technique, reasonable accommodations must be made for disabled persons to submit early in the process
- Date and time of lottery or other random choice should be date recorded on waiting list
- Preferences must also be noted on the list
- Tenant selection must be in accordance with Chapter 4 of Handbook 4350.3, Revision-1 including paragraph 4-15A requiring that once size and preference order is determined, owner must select applications in chronological order to fill vacancies
- Must be in accordance with Affirmative Fair Housing Marketing (AFHM) Plan and target advertising groups other than typical population of neighborhood where property is located reaching out to those least likely to apply because of predominant racial or ethnic group
- Advertising must include Equal Opportunity Housing logo, slogan or statement and depict persons of eligible protected classes including those from both majority and minority groups and both sexes
Notice 2015-03 - Transferring Budget Authority of a Project-Based Section 8 Housing Assistance Payments Contract under Section 8(bb)(1) of the United States Housing Act of 1937
- Amends the language in Housing Notice 2014-14, issued on October 9, 2014 to correct the standard for eligibility of a displaced person under the Uniform Relocation Assistance (URA) and Real Property Acquisition Policies Act of 1970.
- Uniform Relocation Assistance (URA) implementing regulations at 49 Code Federal Regulation (CFR) part 24 provide that a displaced person is a person that moves from real property or moves personal property from real property as a direct result of acquisition, rehabilitation or demolition for a project. The term "project" in this context refers to an activity or series of activities undertaken with Federal financial assistance.
- Housing Notice-2014-14 provides that "any residents that move as a result of acquisition, rehabilitation or demolition or an activity or series of activities" may qualify. The phrase "or an activity or series of activities" is corrected to state "for an activity or series of activities," which is the same as the phrase "for a project" in the URA Regulations.
- This correction conforms the existing language at Section VII(B)(1) to the Uniform Relocation Assistance (URA) standard that Housing Notice 2014-14 was intended to convey.
RHIIP Postings since August 2014
#316 - State Supplementary Payments (SSP) Administered by States
- Issued 9/29/2014
- Some states no longer have SSP, which supplements Federal Supplemental Security Income (SSI), administered by Social Security Administration (SSA)
- Social Security Administration (SSA )no longer able to maintain information about state supplementary payments (SSP) in certain states
- New protocol effects income amounts provided by Social Security Administration (SSA) to the Department of Housing and Urban Development (HUD) and displayed in the Enterprise Income Verification (EIV) system
- To verify payments in states administering state supplementary payment (SSP), verification can be obtained by tenant from state office as outlined in Handbook 4350.3, Chapter 5, Appendix 3.
- If above causes a discrepancy in the enterprise income verification (EIV) system, note reason and place in tenant file.
- State Administered Supplement, (SSA) Supplement and no State Supplement tables are provided in http://www.socialsecurity.gov/ssi/text-benefits-ussi.htm.
#317 - TRACS 202D MAT Guide Published
- Monthly Activity Transmission (MAT) Guide for tenant rental assistance certification system (TRACS) posted 9/29/2014
- Provides information about newest tenant rental assistance certification system (TRACS) update and includes system guidance
previously found in the Department of Housing and Urban Development (HUD) Handbook 4350.3, revision-1.
#318 -2015 Operating Cost Adjustment Factors (OCAFs) Published
- 2015 Operating Cost Adjustment Factors (OCAF's) published in the 10/2/2014 Federal Register
- Factors effective 2/11/2015 and can be found at
#319 - Section 8 Contract Renewal Forms Posted to HUDCLIPS
- Forms relating to Section 8 Renewal process have been updated and posted to the Department of Housing and Urban Development (HUD) Clips
with new Office of Management and Budget (OMB) expiration of 4/30/2017 or removal of OMB expiration date
- Some forms are no longer fillable
- Forms include Department of Housing and Urban Development (HUD)-90055, 93181, 93182, 93184, 9636, 9637, 9638, 9640, 9641, 9642, 9643, 9644, 9648A, 9648D, 9649 and 9651
#320 - Smoke-Free Action Guide Published
- On 10/17/2014 Department of Housing and Urban Development(HUD) issued specific steps for owners and agents who choose to implement a smoke-free policy
- A Smoke-Free Action Guide entitled "Change is in the Air - An Action Guide for Establishing Smoke-Free Public Housing and Multifamily Properties" was published
- Purpose of guide is to further educate about the benefits of smoke-free policies and recommended best practices to follow
#321 - FY 2015 Fair Market Rents
- Effective 10/1/2014 and published in Federal Register on 10/3/2014
#322 - New Passbook Savings Rate Published
- Housing Notice 2014-15 Passbook Savings Rate Effective February 1, 2015 and Establishing Future Passbook Savings Rates posted to HUDCLIPS
- Established new passbook savings rate of 0.06% effective 2/1/2015 and supersedes rate published in the Department of Housing and Urban Development (HUD) Handbook 4350.3, revision-1
- If certifications have been completed to be effective 2/1/2015 or later, the certifications must be corrected
#323 - Housing Notice on Waiting List Administration Published
- Housing Notice 2014-16 Waiting List Administration posted to HUDCLIPS
- Provides options in waiting list administration to further ensure housing compliance; guidance on administration of waiting list such as opening list, placing applicants on list and outreach.
#324 - Cost-of-Living Adjustment (COLA) for 2015
- Social Security and Supplemental Security Income (SSI) benefits will increase 1.7 % beginning 12/31/2014
#325 - Housing Memorandum on Marijuana in Multifamily Assisted Properties
- Multifamily Housing has posted a memorandum Use of Marijuana in Multifamily Assisted Properties that provides details for enforcing requirements found in the Controlled Substance Act and Quality Housing and Work Responsibility Act of 1998
#326 - Multifamily Housing EIV System 9.8 Release Summary
- Implemented 12/19/2014 and added new functionalities the Enterprise Income verification (EIV) system
- Question should be directed to mf email@example.com
#329 - 2015 Annual Adjustment Factors Announced
- Revised Contract Rent Adjustment Factors (AAFs) for 2015 published on 2/9/2015
- Can be found at http://www.gpo.gov/fdsys/pkg/FR-2015-02-09/pdf/2015-02622.pdf
#332 - 2015 Income Limits for Santa Clara County, CA
- Limits for this County were updated because published limits were too low.
#333 - 2015 PAC Renewal Instructions Announced
- Instructions for renewing Project Rental Assistance Contracts (PAC) for fiscal year 2015 have been released for field office processing
- Expiring project assistance contracts (PAC's) can be renewed for a period of one year only.
Other HUD Guidance
Better Buildings Challenge (BBC) Incentive: Allowable Management Add-On Fees - Revised
- On September 19, 2014 Office of Multifamily Housing provided clarification to previous guidance issued in April 2014.
- Better Buildings Challenge (BBC) participants have committed to reduce energy and water usage by 20 percent within 10 years. As a result, department of housing and urban Development (HUD) has offered a management add-on fee incentive to help owners with "greening" their properties.
- This is not a departure from existing HUD guidance regarding management fees in Handbook 4381.5, Management Agent Handbook.
- Guidance does not modify or replace current management fee policy for non- Better Buildings Challenge (BBC) participants.
- Better Buildings Challenge (BBC)-eligible management add-on fees include:
- development/implementation of property-specific Green Operations and Maintenance
- tenant engagement and education to encourage energy and water efficient behaviors and best practices
- utility date collection, entry and/or technical support
- installation and use of energy data benchmarking and/or replacing software
- Better building challenge (BBC)-eligible Management Add-on Fees may not exceed $1.00 per unit per month (PUPM)
- Requests for BBC-eligible Management Add-on Fee should be submitted by mail or electronically to your Project Manager along with a revised Management Certification and BBC Partnership Agreement with a copy to Lauryn K, Alleva, firstname.lastname@example.org
- Department of housing and urban development (HUD) has 15 business days of receiving the revised Certification to complete the review; if the department of housing and urban development (HUD) does not provide a written notice of results within 15 business days, owner/agent may begin collecting add-on management fee; if results of the department of housing and urban development (HUD) review completed after this date indicate a reduction or elimination, these reductions will take effect on date that the department of housing and urban development (HUD) issues the decision.
- Owner and Agent may appeal the results within 30 days after the department of housing and urban development (HUD's) decision letter
- HUD will continue to evaluate this policy and make adjustments as needed to support the goals of better building challenge (BBC).
Administrative Guidance for Multifamily Property Assessed Clean Energy (PACE) in California - PACE program highlights
- Property assessed clean energy (PACE) is a means of financing energy efficiency upgrades or renewable energy installation and in use in California since 2001.
- California's property assessed clean energy (PACE) program allows multifamily property owners to finance energy saving equipment such as insulation, lighting, heating, ventilation, air conditioning HVAC systems, onsite renewal energy (wind turbines, fuel cells etc.) and water saving upgrades such a low-flow plumbing fixtures and grey water systems.
- After an audit identifies energy/water saving opportunities, the owner enters into an assessment contract with the participating property assessed clean energy (PACE) locality. The contract requires reimbursement of cost of improvements through an annual property tax assessment lasting typically up to 20 years.
- Funding is provided by local government or private capital channeled through bond issuance.
- Property Assessed Clean Energy (PACE) obligation remains through the sale or transfer of property.
- Property Assessed Clean Energy (PACE) is premised on an analysis demonstrating that cost of energy and water improvements will be paid in full on a on-to-one basis over time by savings generated by improvements.
- Federal Housing Administration (FHA) insured mortgage remains in first lien position; property assessed clean energy (PACE) assessments are treated like property taxes and other assessments and delinquencies must be paid before any mortgage.
- Requires lender and the Department of Housing and Urban Development (HUD) approval.
- Numerous Department of Housing and Urban Development (HUD) programs including Section 8, 202, 236, 221(d)(3) and (d)(4) are eligible for consideration of a Property Assessed Clean Energy (PACE) assessment.
- Department of Housing and Urban Development (HUD) consideration of granting its consent to enter into a Project Assessed Clean Energy (PACE) assessment has conditions including: compliance with business agreements, Real Estate Assessment Center (REAC) score of at least 60; energy audit completed within past year; evidence that mortgage holder consents to Project Assessed Clean Energy (PACE) assessment, shortfalls in first year may be funded from residual receipts or reserve for replacement funds, savings investment ratio must one or greater (underwriting should be based on up to 70% accuracy with a loss reserve in place, Section 8 or project rental assistance contract (PRAC) projects may not include project assessed clean energy (PACE) assessment in Section 6700: Taxes/Insurance line items of budget worksheet, federal housing administration (FHA) insured or department of housing and urban development (HUD) held mortgages maximum debt must not exceed 85% to 90% of project's value, measures must be permanently fixed to the property, department of housing and urban development (HUD) project manager should review financial performance, term of property assessed (PACE) must not exceed weighted average expected useful life of measures determined in energy audit.
More information regarding the submission, review and approval process is available at http://www.pacenow.org/resources/all-programs/.
HOUSING NOTICE H2015-02 ISSUED ON MARCH 2, 2015
HUB IMPLEMENTATION OF REQUIRED ACTIONS UNDER SECTION 230
FOR MULTIFAMILY HOUSING PROJECTS RECEIVING FAILING SCORES FROM the Department of Housing and Urban Development REAL ESTATE ASSESSMENT CENTER (REAC)
REAC Score of 31-59
- The first 59 to 31 Real Estate Assessment Score (REAC) score will trigger the issuance of the Notice of violation (NOV)/ Compliance, Disposition, and Enforcement (CDE )(if insured) and Notice of Default (NOD)/Compliance, Disposition, and Enforcement (CDE)(if there is Housing Assistance Payment (HAP)rental subsidy). The notice of violation (NOV)/notice of default (NOD)/compliance, disposition, and enforcement (CDE) template includes the compliance, disposition, and enforcement (CDE) requirements.
- The Hub will issue the notice of violation (NOV)/notice of default t(NOD)/Compliance, disposition, and Enforcement (CDE) after the 45 calendar window (for the owner to appeal the score or to request a database adjustment) has expired but no later than 60 days of Real Estate Assessment Center (REAC's)release of the score. Real estate Assessment Center (REAC's) letter also includes the Compliance, Disposition, and Enforcement (CDE) as required by Section 230.
- The Hub's Real Estate Assessment Center(REAC) Coordinator will ask the assigned Project Manager to prepare a draft Hub notice of violation (NOV)/notice of default (NOD)/Compliance, Disposition, and Enforcement (CDE) based on the Real Estate Assessment Center (REAC) Compliance, disposition, and enforcement (CDE) and/or inspection report.
- The Hub's Real Estate Assessment Center (REAC) Coordinator will finalize the Hub Notice of Default (NOD)/ Notice of Violation (NOV)/ Compliance, disposition, and Enforcement (CDE).
- The notice of default (NOD)/Compliance, Disposition, and Enforcement (CDE) will be signed by both the project based contract administrator (PBCA) and the Hub Director if the Housing Assistance Payment (HAP) is assigned to a project- based contract administrator (PBCA).
- The Notice of violation (NOV)/Compliance, Disposition, and enforcement (CDE) will be signed by the Hub Director.
- The Project Manager will issue the Hub compliance, disposition, and enforcement (CDE) to the mortgagee and local government. The owner is responsible for notifying and issuing the Hub compliance, disposition, and enforcement (CDE) to the residents.
- To comply with the Hub's compliance, disposition, enforcement (CDE), the owner must submit a credible Certificate of Completion of Repairs or a credible Repair Plan (with estimated costs and source of funds). The Owner may submit pictures of completed repairs to support the Certification of Completion of Repairs. The Hub has the authority to extend the 60 calendar day compliance window to a reasonable date until the repairs are completed.
- Upon the Project Manager's receipt of the Owner's Certification of Completion of Repairs and/or a Repair Plan (with cost estimate and source of funds), the PM will send a pdf copy of each document to the Hub's REAC Coordinator.
- The Hub's Real Estate Assessment Center (REAC) Coordinator will review, accept, or reject the Certification of Completion of Repairs and/or Repair Plans (with cost estimate and source of funds).
- There is no requirement for the Hub to notify the mortgagee, local government, or residents when the owner has submitted an acceptable answer to the compliance, disposition and enforcement (CDE), (Certificate of Completion of Repairs or Repair Plan) and the Hub closes the Compliance, Disposition, and Enforcement (CDE).
- If the owner complies with the compliance, disposition, and enforcement (CDE) plan, the Hub's Real Estate Assessment Center (REAC) Coordinator will request a follow up inspection within a year using Headquarters' SharePoint site.
- If the owner does not comply with the Notice of violation (NOV)/Notice of Default(NOD)/Compliance, disposition, and ex CDE, the PM will flag both the owner and agent in active partner performance system (APPS) and rate the property as troubled (rating of 5) in SharePoint, and the Hub's Real estate assessment center(REAC) Coordinator will immediately request for a follow up inspection through HQ's SharePoint site.
- If the property receives a second consecutive below 60 score, the procedures outlined above will be repeated. However, the PM will immediately flag the owner and agent in APPS, and the Hub's REAC Coordinator will make an entry in Headquarters SharePoint to comply with congressional reporting requirement.
- Civil money penalties will be departmental enforcement center (DEC's) purview. The Hub can require change in managing agent and other non-civil money penalties.
- The Hub can recommend to departmental enforcement center(DEC) and headquarters must concur on compliance, disposition and enforcement (CDE), Plans involving civil money penalties, suspension or abatement of rent subsidies, foreclosure, or acceleration of the mortgage.
REAC Score of 30 or below
- A score of 30 or below will be automatically referred to the departmental enforcement center (DEC) which will issue a notice of violation (NOV)/notice of default(NOD) /compliance, disposition, and enforcement (CDE).
- The Hub and the departmental enforcement center (DEC)will communicate and coordinate in developing the departmental enforcement center(DEC's ) compliance, disposition, and enforcement (CDE) Plan. The Hub can recommend to departmental enforcement center(DEC) and headquarters must concur on compliance, disposition, and enforcement (CDE) Plans involving civil money penalties, suspension or abatement of rent subsidies, foreclosure, or acceleration of the mortgage.
- The project manager will flag the owner and agent in active performance partners system (APPS) and rate the property as troubled (rating of 3) in SharePoint site.
HQ's SharePoint Site
- The Hub's real estate assessment center(REAC) Coordinator will make all entries in headquarters' SharePoint site.
- If a property scores below 30 or receives two consecutive under 60 scores, the Hub's real estate assessment (REAC) Coordinator will make an entry in Headquarters' SharePoint site to comply with congressional reporting requirement.
Updating milestone events in Problem Statement Section in Integrated Real Estate Management Systems (iREMS)
Project Managers are responsible for updating milestone events in the Problem Statement Section in integrated real estate management system integrated real estate management system (iREMS).
Affirmatively Furthering Fair Housing
Multifamily Industry Meeting
San Francisco (SF) Regional Office
April 16, 2015
Presenter: Jeff Jackson,
- Department of Housing and Urban Development-Fair housing and Equal Opportunity Program Compliance Branch Chief Officer, SF
Segment 1: Overview of Fair Housing Laws
Federal Fair Housing Act
- Prohibits housing providers from discriminating on basis of…
- Applies to virtually all housing providers, private + Department of Housing and Urban Development (HUD)-funded
- Requires Department of Housing and Urban Development (HUD) to administer its programs in such a way as to ensure equal opportunity to participate, without regard to an applicant's or beneficiary's…
- National origin
- Familial status (parents of minor children, custody, pregnancy)
- Disability (physical, mental, developmental)
(42 USC 3608(e)(5); 24 USC 100, et seq.)
Federal Fair Housing Act
- Prohibited Activities include (non-exhaustive list):
- Refusing to sell, rent, deal
- Differential terms and conditions of tenancy
- Discriminatory provision of services
- Discriminatory statements
- False representation of availability
- Denial of reasonable accommodation/modification
- Multifamily (4+) new construction design and accessibility requirements (> 1991)
- Discrimination in terms of mortgage lending
- Discrimination in terms of property insurance
Federal Fair Housing Act
- Reasonable accommodation
- Reasonable modification
- New construction accessibility requirements:
- Applies to private and public construction
- Multifamily 4/more > 3/13/1991
- Ground floor units (non-elevator); all units (elevator)
- 7 covered areas (accessible route, accessible entry, accessible kitchen/bath, accessible environment controls, etc.)
- Accessibility standard: Federal Housing Administration Design Manual, or equivalent
See 24 Code Enforcement Regulation (CFR) 100.200, et seq.
- Title VI of the Civil Rights Act of 1964
- Prohibits recipients of Department of Housing and Urban Development (HUD) funding from discriminating on the basis of, or using methods of administration that have the effect of limiting or denying participation, on the basis of:
- National origin
- Applies to recipients and sub-recipients of federal funding
(24 CFR 1, et seq.)
- Section 504 of the Rehabilitation Act of 1973
- Prohibits recipients of Department of Housing and Urban Development (HUD) funding from discriminating on the basis of, or using methods of administration that have the effect of limiting or denying participation, on the basis of disability
- Applies to recipients and sub-recipients of federal funding
- Requires reasonable accommodations to enable program access and participation by persons with disabilities
- Imposes threshold 5% accessible unit requirement (plus 2% adaptable to people with hearing/sight impairments)
(24 Code Enforcement Regulation (CFR) 8, et seq.)
- Section 504 Program Requirements
- Effective communications (24 Code Enforcement Regulation (CFR) 8.6)
- Section 504 Coordinator (24 Code Enforcement Regulation (CFR) 8.53) applies to recipients and sub-recipients that employ 15 or more persons
- Public notice of non-discrimination on basis of disability (24 Code Enforcement Regulation (CFR) 8.54) applies to recipients and sub-recipients that employ 15 or more persons
- Disability grievance policy (24 Code Enforcement Regulation (CFR) 8.53) applies to recipients and sub-recipients that employ 15 or more persons
- Self-evaluation, needs assessment and transition plan to address physical/program accessibility (24 Code Enforcement Regulation (CFR) 8.51)
- Administratively enforced by Department of Housing and Urban Development (HUD) (no right of private suit)
- Section 504: Physical Accessibility Requirements
- New construction, multifamily projects of 5/+ units
- Minimum of 5%* units accessible to persons with mobility impairments (not fewer than 1)
- Minimum of 2%* units accessible to persons with hearing or vision impairments (not fewer than 1)
- Should include similar range of sites and bedroom sizes and amenities as other units of program
- Uniform Federal Access ability Standards (UFAS) or American Disability Act accessibility guidelines (ADAAG) 2010 are acceptable accessibility standards (24 Code Enforcement Regulation (CFR) 8.32)
- May also apply to rehabilitation projects (24 Code Enforcement Regulation (CFR) 8.22, 23)
- HUD may require higher percentage if demonstrated need
- (24 CFR 8.22, 8.25, 8.26, 8.27)
- Americans with Disabilities Act (ADA)
- Title II applies to state or local government programs/housing
- Title III applies to commercial facilities and public accommodations (Rental offices, childcare centers, community rooms lent for public use, etc.)
- Similar in concept/scope to Section 504
- California Fair Employment and Housing Act (FEHA)
- Administratively enforced by California Department of Fair Employment and Housing (DFEH)
- HUD has work-sharing agreement with the Department of Fair Employment and Housing (DFEH)
- Theories of discrimination
- e.g., "I won't rent to you because you're…(7 protected classes)"
Discriminatory terms and conditions
- e.g., Families with children limited to ground-floor units
- Affirmatively Furthering Fair Housing Choice = a comprehensive strategy designed to:
- Reduce Housing Discrimination
- Promote public awareness of fair housing laws, rights, and obligations
- Ensure a broad range of affordable housing opportunities (location, size, types/special needs)
- Fund programs that address other impediments
- Ensure the programmatic accessibility of housing and programs to all protected classes
- Ensure the physical accessibility of housing and programs to persons with disabilities
Does NOT mean establishing quotas.
- Conducting analysis to identify groups least likely to participate (including development of AI)
- Undertaking affirmative marketing and outreach to promote participation by "least likely" groups
- Taking actions to overcome patterns of segregation or concentration
- Identifying and eliminating methods of administration which may have effect of discrimination
Note: The duty to affirmatively further can be shared with sub-recipients/sub-grantees, but compliance is ultimately the responsibility of the recipient
Actions to Affirmatively Further Fair Housing Choice
Requires coordinated effort by:
- Community Development Block Grant (CDBG)/HOME recipients
- Sub-recipients (housing developers, service providers)
- Local public housing authority
- Department of Housing and Urban Development (HUD)
at each stage:
- Planning/needs assessment, prioritization, predevelopment
- Day-to-day management and program administration
- Affirmatively Furthering Fair Housing Choice
Obligations of a Multifamily HousingProvider-Overview:
- Accurate collection of racial/ethnic/disability data for applicants and current participants;
- Analyze data to detect under-representation (in most cases, a 10% or greater difference is "significant");
- Devise an outreach and marketing strategy in efforts to promote participation by under-represented groups.
- Affirmatively Furthering Fair Housing Choice
Completion of Affirmative Fair Housing Marketing Plan (Department of Housing and Urban Development (HUD) Form 935.2A)
- Tenant demographics
- Applicant demographics
- Housing Marketing Area demographics (generally use entire county) - www.census.gov - Decennial Census or American Community Survey 5-year data
- Identify any group under-represented
(*if new development, use census tract data instead)
- Affirmatively Furthering Fair Housing Choice
- Identify any group under-represented
- If under-representation is evident among current tenants, will housing applicants from waiting list correct the under-representation? (If so, stick with current marketing strategy)
- If applicants also reflect under-representation, identify community contact groups with widely-recognized affiliation and engagement with under-represented groups
- Affirmatively Furthering Fair Housing Choice - selection of community contacts
- Appropriate community contact groups
- Advocacy agencies that are actually involved in helping people with housing and other special needs populations
- Institutions of worship with strong ties to under-represented group
- Inappropriate community contact groups
- Local housing authority (because they are not affiliated with any special R/E/D group)
- Broad-based advocacy groups (e.g.,National Association for the Advancement of Colored People(NAACP), Chamber of Commerce) because people don't go to them to seek housing
- Affirmatively Furthering Fair Housing Choice
- The affirmative fair housing marketing plan (AFHMP) is the game plan, not the game. Housing providers must actually conduct the affirmative marketing and outreach in order to comply with the affirmatively furthering fair housing (AFFH) requirement;
- Conduct re-assessment of affirmative marketing and outreach success before re-opening a waiting list or undertaking any new advertising;
- Submit plan to Department of Housing and Urban Development (HUD) if revisions needed (or, at 5-year intervals);
- Retain documentation of affirmative outreach.
- Coordinated Assessment System - Overarching Fair Housing Goals
- Affirmatively Furthering Fair Housing Choice
- Avoiding concentrations/segregation
- Analyzing data and outreach to under-represented groups
- Olmstead considerations
- Prohibits unjustified segregation of individuals with disabilities
- Limited English Proficiency Considerations
- Ensure that limited English proficiency does not pose a barrier to accessing benefits or services
- Reasonable Accommodation Considerations
- Provide an equal opportunity for persons with disabilities to access benefits or services
- Segment 3 - Title VI Program Access for Persons who are Limited English Proficient
- Title VI prohibits "methods of administration which may have effect of limiting participation on basis of race, color, national origin" (24 Code Enforcement Requirement (CFR) 1.4)
- HUD Final Guidance to Federal Financial Assistance Recipients Regarding Title VI Prohibition Against National Origin Discrimination Affecting Limited English Proficient Persons" issued 1/22/2007
- What does Title VI limited English proficiency (LEP) Guidance Require?
- Oral interpretation is always a requirement
- Recipient must have a plan for communicating with an applicant, participant if he/she is unable to communicate effectively in English
- Language cards to allow identification of language spoken
- Resources such as language line, use of staff
- Never: "If you need a translator, bring your own"
- Limited English proficiency (LEP): Written Translations
- Guidelines establish "safe harbor of presumptive compliance" if four-factor analysis of needs establishes:
- > 1,000 persons limited English proficiency (LEP*) in single language within service area = translations required
- > 5% of population limited English proficiency (LEP) in one language (at least 50) = translations required
- Disclaimer on translated documents: "provided for information only"
- *People who speak as their primary language some language other than English, and who speak English less than well or not at all.
- Limited English proficiency (LEP): Language Access Plan
- Identifies groups who need language assistance
- States how agency will provide language services (transition plan)
- Train staff on plan
- Self assessment and monitoring of plan's effectiveness
- More information about limited English proficiency (LEP) Guidelines
Limited English proficiency (LEP) Question and Answers from Fair Housing and Equal Opportunity Headquarters:
- Segment 4 - Public Indian and Housing (PIH) Notice 2013-21: Admission Preference for homeless persons
Housing Notice 2013-21, issued 7/25/13
- Preferences affect only order in which applicants are selected from the waiting list; they do not determine eligibility;
- Homeless preference should be identified in Tenant Selection Plan;
- Homeless preference does not make anyone eligible who was not otherwise eligible (i.e., does not require lesser eligibility requirements);
- Cannot exclude any protected class.
- Segment 5 - Equal Access Rule
Overview of the Department of Housing and Urban Development (HUD's) lesbian, gay, bi, transgender (LGBT) Rule and Housing Notice 2015-01 issued 2/6/2015
- Definition of sexual orientation and gender identity.
- Addition of general equal access provision.
- Clarification of the Department of Housing and Urban Development (HUD) "family" definition.
- Prohibition on inquiries in certain contexts.
- Addition of sexual orientation and gender identity to existing federal housing administration (FHA) equal access provision.
1. Lesbian, Gay, Bi, Transgender (LGBT) Rule Definitions
- Sexual orientation - homosexuality, heterosexuality, or bisexuality. These classifications are based on the gender or genders of the people someone is physically, romantically and/or emotionally attracted to
- Gender identity - actual or perceived gender-related characteristics of all individuals, including transgender persons, and gender-related characteristics not stereotypically associated with a person's designated sex at birth.
2. General Equal Access Provision:
- Housing assisted by Department of Housing and Urban Development (HUD) or insured by Federal Housing Administration (FHA) shall be made available without regard to actual or perceived sexual orientation, gender identity, or marital status. 24 Code Enforcement Regulation (CFR) Section 5.105 (a)(2).
- Definition of Family Clarification
3. Clarifies definition of "family" (Section 5.403) and "household" (Section 570.3) with lesbian, gay, bi, transgender (LGBT) inclusive language.
-Family includes persons regardless of actual or perceived sexual orientation, gender identity, or marital status.
-Section 8, public housing, Federal Housing Administration (FHA), Community Development Block Grants, 202/811
- Clarification of family is key because family identifies who is eligible to participate in a department of housing and urban development (HUD) funded program.
- Clarification has no impact on other program eligibility requirements (examples; income qualification, annual certification, family members named on lease).
- Prohibited Inquiries
- Prohibits inquiries of an applicant or occupant's sexual orientation or gender identity for the purpose of determining eligibility or otherwise making housing available. 24 Code Enforcement Regulation (CFR) Section 5.105.
Broad coverage: Owners or administrators of department of housing and urban development (HUD)-assisted or insured housing, approved lenders in an federal housing administration (FHA) mortgage insurance program, and any (or any other) recipient or sub-recipient of department of housing and urban development (HUD) funds.
- does not prohibit any individual from voluntarilyself-identifying sexual orientation or gender identity.
- does not prohibit lawful inquiries of an applicant or occupant's sex where the housing provided or to be provided is temporary, emergency shelter that involves the sharing of sleeping areas or bathrooms.
- does not prohibit lawful inquiries of an applicant or occupant's sex made for the purpose of determining the number of bedrooms to which the household may be entitled.
Finally, the rule does not prohibit voluntary and anonymous reporting of sexual orientation or gender identity pursuant to state, local, or federal data collection requirements.
4) Prohibit federal housing administration (FHA) approved lenders from basing eligibility determinations for federal housing administration (FHA)-insured loans on actual or perceived sexual orientation or gender identity.24 CFR Section 203.33.
- Prior regulation listed only race, color, religion, sex, national origin, familial status, handicap, marital status, and source of income as prohibited characteristics to consider.
- The Rule and the Fair Housing Act
- The Fair Housing Act does not specifically include sexual orientation and gender identity as prohibited bases. However, if the rule is violated, lesbian, gay, bi, transgender (LGBT) person's experience with housing discrimination because of gender identity or sexual orientation may still be covered by the Fair Housing Act.
- Both Sexual Orientation and Gender Identity are covered under California State Law.
- More Information
- Conclusion: Internet Resources
- http:// www.fairhousingfirst.org
- Safe Harbors for compliance with the federal housing administration (FHA) accessibility requirements
- Common Violations
- Coverage (addresses bldgs. constructed prior to Mar 13, 1991)
- Seven federal housing administration (FHA) Design and Constructions Requirements
- Code, Design, Disability, Government, Legal, Trade, Other website links
- Internet Resources
- California Department of Fair Employment and Housing (DFEH)
- Department of Housing and Urban Development Fair Housing Laws
- Department of Housing and Urban Development Section 504 - Rehabilitation Act 1974
- Internet Resources
- Americans with Disabilities Act of 1990
- Uniform Federal Accessibility Standards
- Department of Housing and Urban Development-Department of Justice Joint Statements on Reasonable Accommodation and Modification:
- Internet Resources
- Fair Housing and Equal Opportunity Notice 2013-01:
For more information about Fair Housing/ Affirmatively Furthering Fair Housing obligations:
Jeff Jackson, FHEO-Program Compliance Branch, San Francisco
- (415) 489-6538