HOMEfires - Vol. 7 No. 2, October, 2006

Q: When HOME funds are used to rehabilitate a unit, must the entire unit meet the applicable property standards?

 
A. Yes. When HOME funds are used for a rehabilitation project, the work must be performed according to the PJ's written rehabilitation standards, which describe the methods and materials to be used, and the entire unit must be brought up to property standards (i.e. applicable state or local codes or one of the model codes described in 24 CFR 92.251(a)(1)).

It has come to HUD's attention that some PJs believe that, when using HOME funds in a rehabilitation project, only the specific items they chose to address as part of the rehabilitation are subject to the property standards requirement and that the remainder of the unit or project meet the Section 8 Housing Quality Standard (HQS) requirements. This is an incorrect interpretation of the HOME regulations. The purpose of the HOME Program is to develop a stock of standard, affordable housing for low-income families. When HOME funds are committed to a project that will be rehabilitated, the PJ is responsible for inspecting the project to determine compliance with the property standard being used in its HOME Program. The work write-up prepared for the project must include all work required to bring the entire unit into compliance with the applicable property standards.

Section 92.251(a)(1) specifies that housing constructed or rehabilitated with HOME funds must meet all applicable codes, rehabilitation standards, ordinances, and zoning ordinances at the time of project completion and that in the absence of a local code for new construction or rehabilitation, HOME-assisted new construction or rehabilitation must meet, as applicable one of the three model codes (Uniform Building Code (ICBO), National Building Code (BOCA), Standard (Southern) Building Code (SBCCI); or the Council of American Building Officials (CABO), or the Minimum Property Standards (MPS) in 24 CFR 200.925 or 200.926.*

Section 8 HQS is a habitability standard, not a property standard and applies only to acquisition of standard housing (e.g., through a downpayment assistance program). It is not an acceptable property standard for rehabilitation of housing.

It should also be noted that, in units receiving more than $5,000 of federal assistance and in which hard costs of construction exceed $5,000, the entire unit must meet the standards imposed by the lead hazard safety regulations at 24 CFR Part 35. Further, these standards apply to all units in a HOME-assisted rental project (not just the HOME units) and to common areas accessible to residents.

* Note that several of these code-issuing agencies have merged to form the International Code Council (ICC). Consequently, the model codes used for the HOME Program are not being updated; in their stead, the ICC has adopted the International Building Code. HUD plans to issue a technical change to the regulation that will incorporate use of the International Building Code for HOME-assisted housing. Further information on the ICC can be found at http://www.iccsafe.org.