Last week via email, the Department of Housing and Urban Development (HUD) announced to the public the online publication of revised program instructions for the Rental Assistance Demonstration (RAD) in Notice PIH 2012-32/Notice H 2017-03, REV-3. The revised notice, which fills 242 pages, includes the following key revisions for the first component (from the email):

• Allowing PHAs to increase RAD rents by relinquishing existing balances of replacement housing factor (RHF) funds or demolition and disposition transition funding (DDTF)
• Eliminating the cap on the number of project-based voucher units at a project
• Revising the requirements regarding information provided to residents and PHA responses to resident comments at properties undergoing conversion
• Extending the prohibition on re-screening to current public housing households that will reside in non-RAD PBV or non-RAD PBRA units in projects that contain RAD PBV or RAD PBRA units to facilitate the right to return to the assisted property
• Consolidating the selection priority categories for new applications into “high investment applications” and “all other applications” (subject to public comment)
• Allowing PHAs to submit a simple letter of interest rather than an application when a waiting list has formed, where the letter of interest would serve to reserve a project or portfolio’s position on the waiting list subject to future submission of a RAD application (subject to public comment)
• Making an entire contiguous HOPE VI project that was developed in phases eligible, as long as the earliest phase is greater than ten years old (subject to public comment)
• Correcting rent phase-ins for residents who may experience a rent increase as a result of conversion
• Clarifying that a PHA is permitted to receive cash acquisition proceeds in excess of any seller take-back financing and that such proceeds must be used for affordable housing purposes, which is a newly defined term
• Allowing flexibility for requirements related to capital needs assessments, i.e., permitting certain exemptions when the assisted units are a small percentage of the total project
• Requiring title reports to be submitted with the Financing Plan
• Modifying the maximum allowable developer fee by excluding from the formula for larger transactions any acquisition payments made to the PHA, developer fee, and reserves
• Establishing greater flexibility to underwrite to new loan products
• Providing greater detail on the acceptable forms in which a public or non-profit can demonstrate ownership or control
• Providing guidance on owners’ responsibilities to treat lead-based paint hazards in the context of a RAD conversion
• Encouraging PHAs and their partners to grant current workers whose employment positions may be eliminated during conversion the right of first refusal for new employment openings for which they are qualified

Changes for the second component include:

• Likewise eliminating the cap on the number of PBV units at a project
• Permitting Mod Rehab conversions to PBRA to convert at comparable market rents, up to 110 percent of fair market rent (FMR)
• For Mod Rehab SRO conversions, authorizing the use of the efficiency FMR for SRO units, rather than 75 percent of the efficiency FMR, which is the existing SRO standard
• Allowing all conversions to PBRA to achieve rents between 110 percent and 120 percent of FMR, if justified by comparable market rents and only in certain circumstances where preservation criteria have been met
• For conversions to PBRA, permitting the use of small area FMRs (SAFMRs) in the calculation of the contract rent cap, with HUD approval

To help navigate through these numerous changes, HUD has kindly provided two versions of the notice: one showing all of the changes in a redlined format, and a clean version of the document. Both are available here, on the RAD webpage. According to the email, HUD intends to hold live webinars on the notice and will provide more information in the following weeks. Click here to join the RADBlast! email list.

Got questions about RAD? Nan McKay & Associates currently offers three RAD certifications: RAD Project-Based Rental Assistance (PBRA) Overview, RAD Project-Based Voucher (PBV) Specialist, and our newly redesigned Multifamily Housing Specialist (MHS), which is the only training in the affordable housing industry that includes specific requirements for PHAs participating in the RAD program. If your PHA has elected to transform its public housing to project-based rental assistance (PBRA), this training is a must.  If you aren't sure which training is the right one for your agency, give us a call at (800) 783-3100 or email sales@nanmckay.com and our experienced staff will point you in the right direction.

Last week the Department of Housing and Urban Development (HUD) posted new guidance for the Rental Assistance Demonstration (RAD) in Notice PIH 2016-17. The new notice, which fills 80 pages, combines guidance on fair housing and civil rights requirements with resident relocation requirements and procedures. It supersedes Notice PIH 2014-17, HUD’s previous guidance on RAD relocations. Notice PIH 2012-32 (HA) REV-2, which contains RAD implementation instructions, remains in effect.

The new notice is applicable only to public housing conversions under the first component of RAD. It provides PHAs, project owners, and their RAD development partners with guidance regarding key fair housing and civil rights requirements, explains the situations in which HUD is requiring front-end fair housing and civil rights reviews, and provides information regarding the types of information that must be submitted to facilitate HUD’s reviews.

The notice announces a requirement for submission of a fair housing, civil rights, and relocation checklist by PHAs and project owners. The checklist is currently being revised and will be posted to the RAD website when available.

HUD also announced that it will host a webinar on the new notice.

The presentation is scheduled for this Thursday, November 17,

at 2 p.m. eastern time (11 a.m. Pacific). Click here to register.

According to an accompanying press release, the new notice streamlines and accelerates the RAD approval process by:

• Clearly outlining the requirements for fair housing and relocation reviews 
• Providing guidance on what documents to submit and when to submit them, and
• Offering tools such as a comprehensive checklist to help stakeholders prepare submissions

Today in the Federal Register, HUD  published a request for comments on the new notice. While the requirements of the notice are available and became effective upon posting, HUD has published today’s notice to solicit comments with respect to the clarity and comprehensibility of the requirements.  Comments are due by December 14. 

Got questions about RAD? During our year-end sale, you'll save 20% when you register for upcoming sessions of our RAD trainings, RAD Project-Based Rental Assistance (PBRA) Overview and RAD Project-Based Voucher (PBV) Specialist. If you aren't sure which training is the right one for your agency, give us a call at (800) 783-3100 or email sales@nanmckay.com and our experienced staff will point you in the right direction.

NMA trainers Samantha Sowards and Sheryl Putnam will be presenting a session on RAD conversion to PBRA at The Housing Conference

As director of professional development, Sheryl Putnam has spearheaded the development of several NMA seminars, including Blended Occupancy Management, Fundamentals of LIHTC Management, and our newest class, Multifamily Housing Specialist (MHS). Prior to joining Nan McKay and Associates in 2011, she managed the compliance department for a state housing finance agency, providing compliance oversight activities for the LIHTC, PBRA, and HOME programs.

Senior trainer Samantha Sowards has been a part of the NMA team since 2008. As NMA’s manager of curriculum development, Samantha oversees publications from concept and creation through the ongoing revision process, including NMA Master Books, model policies, and handbooks. Sheryl and Samantha will be presenting the following session at the The Housing Conference in San Antonio this September.

Regulatory Knowledge for Smart Management

RAD: Post-Closing Operational Transition for PBRA
Presenters, Sheryl Putnam and Samantha Sowards

Congratulations, you’ve been approved for a RAD conversion to project-based rental assistance (PBRA). Now that you’ve been approved — or are waiting for approval — what’s next? This session will cover the key differences between public housing, PBRA, and RAD PBRA that you and your team need to know about. We will cover in-place resident considerations, eligibility and occupancy differences, rent phase-in requirements, what to do when TTP is greater than the contract/market rent, and more. We will also touch on some blended occupancy issues if you are adding low-income housing tax credits.

If you're interested in learning more about PBRA, don't miss our upcoming session of Multifamily Housing Specialist! Conference attendees save 10% on the seminar, which will be held immediately following the first two days of the The Housing Conference. Extend your stay and expand your learning! Register online or email sales@nanmckay.com for more information. Don't delay, room blocks are filling up fast.

This week via “RADBlast!” HUD released new guidance on the closing process for units converted to the rental assistance demonstration (RAD) program. The guidance is a result of feedback HUD received earlier this year.

The first change involves effective dates for HAP contracts following completion of the closing process. Effective immediately, project owners may now select the effective date of the HAP contract as the first day of either of the two months following the completed closing. For example, if the project closes on October 20, 2017, the HAP contract can be effective on either November 1, 2017 or December 1, 2017. HUD expects that the change will allow PHAs and project owners to better prepare for funding in the initial year and also allow for more time and flexibility to complete administrative functions such as executing new tenant leases.

HUD also announced that it will host a live Q&A session to walk

through the revised tools and respond to PHA questions.

The presentation is scheduled for today, July 13, from

3 p.m. until 4 p.m. eastern time (noon until 1 p.m. Pacific).

In a second change, HUD announced that it is releasing two tools intended to provide guidance on how funding of the new contracts works in the initial year. Initial year funding instructions describe the calculation of funding during the period between the HAP contract effective date and the remainder of the calendar year, as well as instruction on how to access these funds. An initial year funding tool will allow PHAs and project owners to calculate the amount of revenue that will be available to the project in the initial year and ensures that all parties have an accurate understanding of these amounts. Neither of the new tools has been posted to the RAD website.

Got questions about RAD? Don’t miss our sessions on post-closing operational transition at the The Housing Conference this September. You can read the description for the RAD PBV session online here.

This week on the Office of Capital Improvements (OCI) website, HUD posted a revised version of the Capital Fund Guidebook. The new, undated version replaces the original guidebook, which was dated August 2015. While the 2015 version was numbered “Handbook 7600.1,” the new version does not have a handbook number.

The following brief announcement was posted to the OCI home page:

The capital fund guidebook details the requirements contained under the public housing capital fund program final rule, including but not limited to eligible and ineligible activities and cost limits; decoupling of the capital fund from the PHA plan submission; replacement housing factor grants (RHF) and demolition and disposition transitional funding (DDTF); changes in obligation and expenditure end dates and close-out requirements; emergency, non-presidentially declared natural disaster, and safety and security grant program requirements; streamlined mixed-finance and other public housing modernization and development requirements; changes to demonstration programs such as RAD and MTW; and capital fund rule impact on security interests and financing activities.

Got questions about RAD, MTW, and the capital fund? Don’t miss the The Housing Conference this September in San Antonio, Texas, where NMA's Carrol Vaughan and other industry experts will address hot topics around those issues. Register online or email sales@nanmckay.com for more information.

Click to view at full size (you might have to click a second time to zoom in).

This week, the NMA design department put together the fun infographic that you see on the right.

Click to view the infographic at full size (you might have to click a second time to zoom in).

In other news, last week HUD’s Office of Public and Indian Housing (PIH)–Real Estate Assessment Center (REAC) issued a notice for all certified inspectors who conduct physical inspections of HUD assisted and insured properties in accordance with the Uniform Physical Condition Standards (UPCS).

Inspector Notice No. 2016-01 amends inspection requirements for properties reported to have or suspected of having bed bug infestations. The updated protocol, which among other things now requires inspectors to enter all units in which bed bugs are reported, becomes effective February 1, 2016.

You will find a link to the notice on this page at REAC’s website, along with a link to a compressed (WinZip) file of a recorded conference call discussing the new notice.

This week HUD also published its January newsletter for RAD participants, which includes a very positive article about the Housing Authority of Greene County (HAGC) in Illinois, who replaced obsolete units with new single family homes through a RAD conversion.

The January newsletter also includes an announcement that RAD's first substantial rehab project, an extensive rehabilitation of 150 units in Washington State, is now complete. Congratulations to the Housing Authority of the City of Yakima (YHA) for their success!

HUD's newsletter concludes with a page of handwritten thank-you notes from happy residents impacted by RAD at the Housing Authority of the City of San Buenaventura (HACSB).

Any interesting stories that we missed? Leave your links and recommendations in the comments!

This week on HUDCLIPS, the Office of Public and Indian Housing (PIH) posted the newly published and highly anticipated Capital Fund Guidebook, Handbook 7600.1. The guidebook is meant to be taken along with the capital fund program final rule to ensure that the capital fund program is more efficiently and uniformly implemented by PHAs and managed more effectively by HUD field offices. The final rule was published on October 24, 2013, but until now the guidebook had yet to be issued.

The 188-page document consists of 12 chapters offering guidance for all areas of the program, including:

• Background and introductory information, such as an overview of the program and types of grants
• Eligible activities, ineligible activities, and cost limits
• Planning, annual submission, and distribution of funds
• Capital fund formula calculation
• Replacement Housing Factor (RHF) Grants, Demolition Disposition Transitional Funding (DDTF), and the transition from RHF to DDTF
• General program requirements and implementation, including wage rates, procurement and contract requirements and administration, and other requirements
• Obligation, budget revision, expenditure, and closeout
• Emergency, non-presidentially declared national disaster, and safety and security grants, covering eligible and ineligible uses of the latter
• Public housing development and methods of development, including funding sources, general program requirements, mixed finance, and site acquisition and development proposals
• Demonstration programs, such as the Rental Assistance Demonstration (RAD) and Moving to Work (MTW) programs, including the procedure for RAD conversion
• Security interests and financing activities, including capital fund and operating fund financing programs, Section 30, CFCF, and capital financing not secured by the property
• Compliance, penalties, and sanctions

It is worth noting that the guidebook also contains useful exhibits at the end of several chapters with various examples, lists and checklists, model plans, and process overviews, in addition to appendices at the end of the guidebook consisting of definitions and an eligible activities chart. While the table of contents lists a third appendix for the capital fund final rule itself, it does not appear to be present or linked in the document.

HUD has scheduled several two-day training sessions on the new guidebook, the details of which can be found on the Office of Capital Improvements webpage. Upcoming sessions will be held in Detroit (2 classes), Denver, Atlanta (2 classes), St. Louis, San Francisco, New York, and Houston (2 classes). For more information and to register for the trainings, click here.

Got questions about RAD, MTW, and the capital fund? Don’t miss the 2015 NMA and GoSection8 Housing Conference, where NMA's Carrol Vaughan and other industry experts will address hot topics around those issues. Register online or email sales@nanmckay.com for more information.

In a notice of proposed information collection published in Friday’s Federal Register, HUD’s Office of Public and Indian Housing (PIH) requested comments on new application forms for the Rental Assistance Demonstration (RAD) program:

The RAD applications are Excel-based and will be pre-populated with data the department collects and maintains for each housing agencies. Information collected by the applications will allow the department to determine which applicants meet the eligibility requirements and have the capacity to successfully meet RAD’s mission delineated in Notice PIH 2012-32, REV-2.

To review draft versions of the applications, please follow the links provided: Obtain Draft Application for PHAs and Obtain Draft Application for Owners of Mod Rehab.

If you wish to submit comments on the new RAD application forms, you’ll find instructions following the “Addresses” heading in Friday’s notice. Comments are due by August 31, 2015.

In other RAD news, the National Housing Law Project (NHLP) has posted a new memorandum that reviews and analyzes the long-term affordability provisions of the RAD program. The memorandum lists the "five key documents that contain long-term renewable use and affordability protections for both the project and tenants in converted units," then explains that despite these protections, two significant risks remain:

Of course, these substantial protections are not absolute guarantees; affordability could be compromised by Congress’s failure to provide adequate Section 8 funding or by termination of HAP contracts by HUD or the contract administrator. Additional risks include unremedied breaches of critical contracts, policies or laws, or unforeseen circumstances that motivate HUD to use legally-conferred discretion to relax or release certain requirements or use agreements.

To stay updated, follow the #RAD tag to keep up with all related blog posts, or subscribe to the PIH Alert and receive a daily email with breaking news and analysis for PHAs and housing professionals.

On Friday in the Federal Register, HUD solicited comments on regulatory and other changes to the Rental Assistance Demonstration (RAD). Friday’s notice follows the June 15 publication of Notice PIH 2012-32, REV-2, which announced revisions and alternative requirements for the program. This notice announces further revisions to RAD and solicits public comment on changed eligibility and selection criteria.

As further explained in the notice, items subject to notice and comment will be effective July 27, 2015. The due date for comments is also July 27.

If HUD receives adverse comment that leads to reconsideration, HUD will notify the public in a new notice immediately upon the expiration of the comment period.

To receive updates and analysis on the latest PIH news, subscribe to NMA’s PIH Alert and receive a daily email with breaking news and other important information for PHAs and housing professionals.

In a press release Monday, the Department of Housing and Urban Development (HUD) announced to the public the online publication of revised program instructions for the Rental Assistance Demonstration (RAD) in Notice PIH 2012-32, REV-2.

The revised notice, which fills 235 pages, includes the following key revisions:

• Increases the cap on public housing conversions from 60,000 to 185,000 units (approximately 15 percent of the public housing stock)
• Expands the program's eligibility to include Moderate Rehabilitation Single Room Occupancy (Mod Rehab SRO) properties funded under the McKinney-Vento Homeless Assistance Act
• Strengthens key rights and protections for residents
  • Requires owners/mangers to notify and consult with residents
  • Gives residents the a right to remain or return to the property
  • Prohibits re-screening of current residents
  • Provides an option for a tenant-based voucher, if a resident chooses to leave the assisted property following conversion
  • Continues the essential rights and protections provided under the public housing program, including funding to support resident organizations
• Offers multifamily property owners participating in HUD's legacy Rent Supplement (Rent Supp) and Rental Assistance Payment (RAP) programs full participation in the RAD program
• Strengthens the requirement that PHAs maintain control of any new entity formed as part of a RAD conversion

In a related “RADblast” emailed yesterday, HUD added two live question-and-answer (Q&A) sessions to its schedule of RAD training events:

• June 19 Q&A session on public housing, 2 p.m. eastern time
• June 19 Q&A session on Mod Rehab, Rent Supp, and RAP, 3 p.m. eastern time

To receive more updates and analysis like this on the latest HUD news, subscribe to NMA’s PIH Alert and receive a daily email with breaking stories and other important information for PHAs and housing professionals. Have you entered our contest to win a free year’s subscription to the PIH Alert? Don’t delay, the contest ends tomorrow!