San Francisco Multifamily Hub Industry Meeting

April 19, 2012
Agenda

Final Industry Meeting for 2012: October 18th

Summary of Topics

1. General Update on Preservation Pipeline and Coordination
   • There has been a sharp increase in preservation deals coming into Asset Management for processing, due to recently released HUD guidance and changes in the market.
   • The San Francisco Hub has developed a new process for managing these complex preservation transactions (prepayment and/or refinance deals, often involving low-income housing tax credits, extension of affordability and/or substantial rehabilitation).
   • HUD Project Managers will continue to manage deals throughout each transaction however an additional Preservation Coordinator will be assigned to provide continuity and technical support.
   • Owners should contact their HUD Project Manager to begin discussions as early in the process as possible to allow sufficient time for processing, especially for complex deals and deals with Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA) Use Agreements.
     
     
2. Guidance on Eligibility for Tenant Protection Vouchers (TPVs) Following Certain Housing Conversion Actions (HUD Notice 2012-3)
   • HUD issued Notice on 2/24/2012 to supplement Public and Indian Housing (PIH) Notice 2001-41 and provide owners with updated information on availability of TPVs for residents of HUD-assisted and/or properties insured under Sections 236, 221(d)(3), 202 and 221(d)(4);
   • The Notice describes features and eligibility criteria for receiving TPVs, subject to appropriations;
   • Certain TPVs may be issued following mortgage prepayment or opt-out; HUD has discretion to provide TPVs after Rent Supplement or Rental Assistance Payment (RAP) Contract termination and Section 202 prepayment;
   • Two types of TPVs may be provided: Enhanced Vouchers (EVs) as a result of certain "eligibility events;"and Regular Vouchers;
   • Enhanced and Regular vouchers have different payment standards; EVs allow resident to remain in the unit; regular vouchers may permit residents to stay but they do not have the "right to remain;"
   • Mortgage prepayment is an eligibility event and residents not residing in assisted units may receive EVs under certain conditions; EVs are not provided to unassisted residents when mortgage matures;
   • EVs may be provides due to prepayment on a property with Flexible Subsidy, to residents not currently receiving rental assistance if property is preserved as affordable and eligibility criteria are satisfied; HUD HQ will determine on a case-by-case basis if such a prepayment triggers EVs;
   • In most cases, 150-day tenant notification applies;
   • If project received assistance under Emergency Low-Income Housing Preservation Act (ELIPHA) with Use Agreement, EVs cannot be provided to residents at the expiration of the Use Agreement;
   • HUD may provide EVs or regular vouchers to residents of housing with project-based rental assistance including Section 8 HAP contracts, Rent Supplement and RAP.
   • HUD may provide TPVs to prevent displacement of unassisted elderly residents residing in Section 202 properties financed between 1959 and 1974; more guidance on this matter is forthcoming.
   • This Notice can be found online.
     
     
3. Recent Guidance on Extensions of Rent Supplement & Rental Assistance Payment (RAP) Contracts Expiring in Fiscal Year 2012 and beyond
   • On 1/20/2012, HUD HQ issued instructions to the Multifamily Hubs for extensions of Rent Supplement and RAP Contracts;
   • HUD has authority to extend expiring Rent Supplement and RAP Contracts but not due to mortgage prepayment;
   • Extensions are subject to appropriations; funding is limited and will be prioritized; extensions will be granted until funds are no longer available;
   • HUD can offer extensions up to one year;
   • Contracts must be tied to eligible Federal Housing Administration (FHA)-insured subsidized mortgage, such as Section 235, 221(d)(3)-(d)(5) mortgage, Section 202 or mortgage provided by a state Housing Financing Agency (HFA); contracts automatically terminate upon maturity or prepayment of mortgage, or 40 years from date of first payment under the contract, whichever occurs first;
   • HUD may not extend a contract beyond prepayment or mortgage maturity;
   • HUD HQ approval is required;
   • Project must meet threshold criteria; Satisfactory or higher Management and Occupancy Review rating; REAC score of 60 or above; and date of expiring contract must be on or after 1/20/2012;
   • Owner should request extension 60 days prior to Rent Supplement or RAP Contract expiration date;
   • Regular Tenant Protection Vouchers (non-enhanced) can be provided to eligible families when Contracts are terminated due to expiration, prepayment or enforcement action but Rent Supplement or RAP Contracts would no longer be available as assisted housing (see PIH Notice 2001-41 and HUD Notice 2012-3);
   • Contract would be extended using existing rents; no budget-based rent increases will be considered; extension only covers units actively billed under Rent Supplement or RAP Contract;
   • If you have any questions concerning the above, contact your Project Manager.
     
     
4. Rental Assistance Demonstration (RAD or Demonstration) - Partial Implementation and Request for Comments (HUD Notice PIH-2012-18 (HA)
   • HUD issued Notice on 3/8/2012 to provide instructions for RAD or Demonstration including eligibility and selection criteria seeking public comment, however, Section III of the Notice is effective;
   • Final Notice will be issued with final instructions following consideration of public comments which were due no later than 4/9/2012;
   • The first component allows projects funded under public housing or Section 8 (S/8) Moderate Rehabilitation (Mod Rehab) program to convert assistance to long-term project-based Section 8; owners chose either project-based vouchers (PBV) or project-based rental assistance (PBRA);
   • The second component allows owners of projects funded under Rent Supplement, RAP and Mod Rehab to convert tenant protection vouchers (TPVs) to PBVs upon contract expiration or termination occurring after 10/1/2006 and no later than 9/30/2013; actions under this component are subject to availability of TPVs;
   • Projects that convert assistance under this Demonstration are referred to in the Notice as "covered projects";
   • Section III is effective immediately; it provides interim instructions to owners of Rent Supplement and RAP projects who can convert assistance under the second component above; projects that convert assistance prior to the Final Notice will be subject to interim instructions in Notice;
   • Demonstration goals are to: test the conversion of public housing, other HUD-assisted properties to long-term, project-based S/8 rental assistance in order to preserve, to improve and to address immediate and long-term capital needs; and to test the extent to which residents have increased housing choices after conversion and the overall impact on the properties.
   • This Notice can be found online.
     
     
5. Implementation of Funding for Tenant-Protection Vouchers for Certain At-Risk Households in Low-Vacancy Areas (HUD Notice PIH 2012-19): NOTICE RETRACTED
   
   
6. Performance-Based Contract Administrator (PBCA) Update
   • New Notice of Funding Availability (NOFA) Closing Date: June 11, 2012 (used to be April 10, 2012)
   • The awardees will probably be announced in August 2012 after the Technical Evaluation Panels have completed their review
   • Start date for successful PBCA to perform work based on the new Annual Contributions Contract (ACC): December 1, 2012
     
     
7. DUN and Bradstreet Numbering System (DUNS) Numbers (Rental Housing Integrity Improvement Project (RHIIP) #270) & Enterprise Income Verification (EIV)
   RHIIP 270: REMINDER - Owners with Project-based Rental Assistance Contract or Section 202 or 811 Project Rental Assistance Contracts Must Obtain DUNS Numbers and to Register in the Central Contractor Registration (CCR)
   • There are still owners who have failed to obtain a DUNS number and to register in the CCR System.
   • In order to continue to receive housing assistance payments or rental assistance payments, Owners are reminded that they must comply with the requirements of Notice H 2011-01.
   • Covers Project-based S/8 or Section 202 or 811 Project Rental Assistance Contracts.
   • HUD will issue a Housing Notice shortly clarifying that this requirement also applies to RAP and Rent Supplement contracts.
   • CCR requires Owners to recertify annually, and Notice H 2011-01 requires Owners to maintain their CCR registration. HUD will be implementing a new Funding System in May 2012.
   • Owners who are not in compliance with the requirements of the Notice by April 23, 2012 risk suspension of their housing assistance or rental assistance payments.
     
     
8. Equal Access to Housing in HUD Programs Regardless of Sexual Orientation or Gender Identity HUD Lesbian, Gay, Bisexual, and Transgender (LGBT) Rule (Effective March 6, 2012)
   • Definition of sexual orientation and gender identity
     • Sexual orientation = homosexuality, heterosexuality, or bisexuality.
     • Gender identity = actual or perceived gender-related characteristics.
       
       
   • General Equal Access Provision
     • Housing assisted by HUD or insured by FHA shall be made available without regard to actual or perceived sexual orientation, gender identity, or marital status. 24 Code of Federal Regulations (CFR) Section 5.105 (a)(2).
       
       
   • Clarification of HUD "family" definition
     • Clarifies definition of "family" (Section 5.403) and "household" (Section 570.3) with LGBT inclusive language.
     • Family includes persons regardless of actual or perceived sexual orientation, gender identity, or marital status.
       • Clarification of family is key because family identifies who is eligible to participate in a HUD program.
     • Coverage applies to Section 8, public housing, FHA, Community Development Block Grants, Housing Opportunities for Persons with AIDS (HOPWA), 202/811
       • Clarification has no impact on other program eligibility requirements (e.g., income qualification, annual certification, family members named on lease).
         
         
   • Prohibition on inquiries in certain contexts
     • 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 CFR Section 5.105.
       • Broad coverage: Owners or administrators of HUD-assisted or insured housing, approved lenders in an FHA mortgage insurance program, and any (or any other) recipient or sub-recipient of HUD funds.
         
         
   • Addition of sexual orientation and gender identity to existing FHA equal access provision
     • Prohibit FHA-approved lenders from basing eligibility determinations for 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.
       (77 Federal Register (FR) 5662 February 3, 2012)
       
       
9. RHIIP #271: 2012 Annual Adjustment Factors Announced
   • On April 13, 2012, a Notice of the Revised Contract Rent Annual Adjustment Factors (AAFs) for 2012 was published.
   • The AAFs are effective April 13, 2012. A copy of the Federal Register containing the revised AAFs is located online (www.gpo.gov/fdsys/pkg/FR-2012-04-13/pdf/2012-8971.pdf).

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