With aging housing stock and dwindling resources, it's not uncommon to manage projects with two, three, or more separate sources of funding and/or subsidy, each with different oversight agencies and compliance requirements.
These blended occupancy projects, also referred to as mixed-finance projects, have multiple funding and/or subsidy sources, creating a maze of complicated and often conflicting regulations. In addition to being proficient in the HCV and public housing programs, PHA managers and staff must now be knowledgeable in a variety of other programs such as project-based vouchers (PBV), Low-Income Housing Tax Credit (LIHTC) and HOME.
Failure to maintain continuous program compliance in these programs can result in serious consequences. Follow our three-part series to learn more about some of the major regulatory differences in blended occupancy projects.
Part I: Inspection Standards/Frequency
Part II: Annual Recertification Requirements
Inspection Standards/Frequency
In blended occupancy projects, the inspection standard that must be used varies depending on the type of funding in the project. In projects with multiple funding sources, we recommend adherence to the most restrictive inspection standard protocol to ensure that your projects and units remain in continuous program compliance.
Low-Income Housing Tax Credit (LIHTC) Inspection Standards:
The LIHTC program requires that projects must be in safe, decent, sanitary condition and in good repair, according to either the Uniform Physical Conditions Standards (UPCS) established by HUD, or local inspection standards. The standards to be used must be identified in the state's Qualified Allocation Plan (QAP).
Low-Income Housing Tax Credit (LIHTC) Inspection Frequency:
IRS code requires that owners certify to the state monitoring agency, typically the state housing finance agency, in writing, on an annual basis, that all LIHTC units and buildings were suitable for occupancy, for the preceding 12-month period, in the form and format outlined in the state's QAP. State monitoring agencies must perform onsite inspections of LIHTC properties once every three years to ensure that LIHTC buildings and units are suitable for occupancy. Based on this requirement, it's recommended that LIHTC owners perform move-in, annual, and move-out inspections.
Section 8 Project-Based Rental Assistance (PBRA) Inspection Standards:
HUD requires that projects receiving PBRA assistance must be in safe, decent, sanitary condition and in good repair, according to HUD's UPCS standards.
Section 8 Project-Based Rental Assistance (PBRA) Inspection Frequency:
HUD handbook 4350.3 requires that PBRA owners/agents perform move-in, annual, and move-out inspections.
Section 8 Housing Choice Voucher Project-Based (PBV) Inspection Standards:
HUD requires that units under a PBV HAP contract be in safe, decent, sanitary condition and in good repair according to HUD's Housing Quality Standards (HQS).
Section 8 Housing Choice Voucher Project-Based (PBV) Inspection Frequency:
HUD regulations require pre-HAP contract, turnover, and annual inspections by the PHA.
Public Housing Inspection Standards:
HUD requires that all public housing units be in safe, decent, sanitary condition and in good repair according to HUD's UPCS.
Public Housing Inspection Frequency:
HUD regulations require that the PHA perform move-in, annual, and move-out inspections.
HOME Inspection Standards:
While all HOME-assisted properties must meet minimum property standards including the control and abatement of lead-based paint, the specific property inspection protocol varies depending on the type of HOME-assisted project. Housing constructed or rehabilitated with HOME funds must meet all applicable local codes, rehabilitation standards, ordinances, and zoning ordinances at project completion and throughout the project's affordability period.
Additionally, the participating jurisdiction must have written standards for rehabilitation that ensure the HOME-assisted housing is decent, safe, and sanitary.
Acquisition of existing rental housing with HOME funds must meet all applicable state and local housing quality standards and code requirements if applicable, or HUD's HQS in the absence of such standards or code requirements.
HOME Inspection Frequency:
Although HUD regulations do not specifically dictate when owners of HOME-assisted properties must perform inspections, all HOME-assisted properties must meet minimum property standards throughout the project's affordability period. Depending on the total number of units in the property (not the number of HOME-assisted units in the property), participating jurisdictions must perform onsite inspections of HOME-assisted properties to ensure compliance with HOME property standards. We recommend performing move-in, annual, and move-out inspections.
As an NMA trainer and consultant, Sheryl Putnam spearheaded the development of NMA's Blended Occupancy Management course.
