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If a tenant is in the RAD PBV phase-in period and transfers to a different size unit in the same PBV project, does the phase-in still apply or will rent be based on TTP at that point?

If the rent increase is occurring because of new income, the rent phase-in does not apply. If the tenant's monthly rent increases because the tenant moved to a new unit as a result of the RAD conversion, then the phase-in does apply.

Processing of Recertifications by Management Company Following PBV Conversion

We are a Property Management company that was previously processing the annual recertifications for the Public Housing units. The units have now converted to PBV under RAD. Do we continue to do the annual/interim recertifications until Jan. 1 of the following year, and do we issue the utility reimbursement checks? Or, does the Housing Authority take over the recertifications/interims and issue the utility reimbursement checks as the of RAD closing date?

It is up to the PHA how they wish to handle processing of recertifications and utility allowances for its voucher program. HUD does not prevent PHAs from contracting with a management company to perform these tasks.

PBV HAP Contract Administration

How can a PHA own a property covered under a PBV contract that it will administer?

Under the PBV program, the Contract Administrator and the Owner listed on the contract cannot be the same legal entity (i.e., the PHA cannot execute a contract with itself). To avoid this situation, the PHA may either: 1) Transfer the ownership of the project to a non-profit affiliate or instrumentality of the PHA (including to a “single-purpose entity” that owns nothing other than the property, which will typically be a requirement of a lender or investor) or 2) The PHA can form a related entity that is responsible for management and leasing and can serve as the owner for purposes of the Section 8 HAP contract; in this scenario, the HAP is then executed between the PHA (as the Contract Administrator) and the PHA’s related entity (as the Owner for HAP contract purposes). Note that in the second scenario, both the PHA and the entity serving as the Owner for HAP contract purposes will be required to sign the RAD Use Agreement. Additionally, where the PHA owns a property covered under the PBV contract, the PHA must utilize an independent entity, approved by HUD, to perform the HQS inspections and rent reasonableness (24 CFR 983.59). The independent entity that performs these tasks can be the unit of general local government for the PHA jurisdiction (unless the PHA it itself the unit of general local government or an agency of such government), or any other HUD-approved public or private independent entity.

Reporting Rehab Assistance Payments in VMS (PBV Conversion)

We converted to PBV and units were vacated due to rehab and thus we are eligible to receive Rehab Assistance Payments (RAP). How do we report the use of the RAP funds in VMS?

The VMS Users Manual instructs PHAs to report Rehab Assistance Payments in the RAD 1 HAP Expense field in VMS. PHAs should not report the units as leased.

Date of Last HQS Inspection on Form 50058 when there are Initial Repairs

For a PBV conversion, where the property is undergoing initial repairs, the RAD Notice requires that all units meet HQS no later than the date of completion of initial repairs as indicated in the RAD Conversion Commitment, rather than prior to entering into the HAP contract. If an HQS inspection does not occur until the initial repairs are completed, what dates should be entered into the Form-50058 for the date of last inspection for residents that are residing in the units while the repairs occur?

In such cases, the PHA should carry over the date that the unit was last inspected as a public housing unit.

Internet in a PBV Utility Allowance?

Can a RAD owner include the cost of internet in the RAD project's utility allowance?

According to 24 CFR 982.517, "A PHA's utility allowance schedule, and the utility allowance for an individual family, must include the utilities and services that are necessary in the locality to provide housing that complies with the housing quality standards (HQS). However, the PHA may not provide any allowance for non-essential utility costs, such as costs of cable or satellite television." Since internet is not necessary to comply with HQS and is therefore also considered "non-essential", its cost cannot be included as part of a utility allowance. Internet cannot be included on PBRA properties either.

Missed OCAF Adjustments on RAD PBV Properties

Can a RAD converted property receive OCAF adjustments for prior years which have not been taken on an annual basis? For instance, a property converts to RAD in 2017 but has not applied for an OCAF adjustment since the conversion. In 2020, the property requests an OCAF adjustment. Is that property eligible to receive all of the OCAF adjustments since 2017 (meaning 2018, 2019, and 2020)?

Yes, the OCAF must be applied retroactively if it was missed, since the RAD PBV HAP Contract gives the owner the right to contract rents adjusted by each year’s OCAF. The Contract Administrator must make sure that all OCAFs have been applied correctly since the RAD closing and calculate the current rents accordingly, including making sure that the RAD PBV contract rents do not exceed the PBV program caps. If the Contract Administrator is also the project owner, then the calculations must be performed by an independent entity. As a reminder, there is a PBV OCAF Tool available on www.radresource.net to help ensure the calculation is done correctly. Once the calculations have been made, the Contract Administrator must reach out to the PIH Financial Management Center (FMC), including the Operations Division Director and Team Lead, to request the make a retroactive subsidy payment. Contact information for the FMC can be found here: https://www.hud.gov/program_offices/public_indian_housing/programs/hcv/contact#FMC. Contract Administrators should also include their local Public Housing field office on discussions regarding the OCAF, or if the retroactive adjustment may adversely impact the PHA’s HCV program.

In-Person Meetings During COVID-19

Where can a PHA or owner find guidance regarding PBRA or PBV program requirements that customarily involve in-person meetings?

Guidance is available and will be continually updated at www.hud.gov/coronavirus. Guidance for PBRA can be found within “FAQs for Multifamily Housing Providers” (Available at https://www.hud.gov/sites/dfiles/Housing/documents/HUD_Multifamily_Corona_QA_FINAL.pdf). For PBV, please see “FAQs for Public Housing, Housing Choice Voucher, Project-based Voucher Program, and Native American Programs.” (Available at https://www.hud.gov/sites/dfiles/PIH/documents/COVID19_FAQ_PIH_Final.pdf)

Administrative Fees

Is the administrative fee that is paid to the contract administrator at the same rate as for tenant based vouchers?

If you are referring to a RAD PBV conversion, the admin fee PHAs receive for regular vouchers is the same admin fee PHAs receive for PBVs. If you are referring to PBRA and the admin fee that performance based contract administrators (PBCAs) get to administer a PBRA HAP contract, it is a different fee (but also a different set of work). It is also important to note that RAD PBRA HAP contracts are currently administered by HUD and not PBCAs.

OCAFs for PBV Properties

I have a PBV property which converted through RAD. How do I obtain the OCAF adjusted rents for this property?

Following conversion to PBV, the project’s contract rents are eligible for an annual OCAF adjustment at each HAP contract anniversary. The administering PHA (or independent entity, if the project is owned by the administering PHA) will be responsible for processing the OCAF and ensuring the owner is receiving the updated rent amounts. Please see the following instructions found in the “RAD PBV OCAF Adjustment Tool (Post-Closing)” spreadsheet available on the RAD Resource Desk Document Library: “Per the RAD Notice and the HAP Contract, the RAD contract rents are adjusted at each anniversary of the HAP contract by the Operating Cost Adjustment Factor (OCAF). 24 CFR 983.301 and 983.302 do not apply. For RAD PBV properties, contract rents are the lesser of reasonable rent and the OCAF-adjusted rent. HUD calculates and publishes the OCAF each year in the Federal Register. The OCAF is applied to the portion of a contract rent not committed to debt service. As a result, the rent adjustment can be more complex than simple multiplication. Further, the Federal Register notice states when the OCAF for each year takes effect - typically, a specified date in February. As a result, a contract with an anniversary date on January 1 or February 1 will usually use the OCAF for the prior year (e.g. a contract with a HAP anniversary date of January 1 will be adjusted on January 1 of 2018 by the 2017 OCAF).” This spreadsheet can assist in calculating what the rents should be, but this Tool is for internal calculation purposes only and does not need to be submitted to HUD.

Designating Elderly Units in RAD PBV Conversion

In a RAD conversion to PBVs, can a PHA “designate” a building as elderly

No. Prior to the enactment of HOTMA, the PBV program had an income mixing component, wherein not more than 25% of the units in the project could be assisted, with exceptions for units made available for certain types of households, including elderly households. Under those requirements, a PHA could designate specific units for elderly occupancy. Since HOTMA has eliminated this income-mixing requirement, PHAs can no longer designate units in such a manner. A PHA may, however, adopt a project-specific waiting list and an admission preference for elderly households.

Utilizing Op and Cap Funds to Pay for PBV Admin Fee in First Year of Conversion

This is for a public housing conversion to PBVs. During the conversion year under PBV, the voucher-administering agency earns no admin fee (Notice, REV-2, page 60). However, can the converting agency choose to reimburse the voucher-administering agency for its admin costs?

Yes, the PHA may do so long as (1) the amount paid is not more than the allowable HUD schedule of admin fees and (2) the PHA identifies these amounts in the Development Budget (Sources and Uses). This action is allowable even if the converting agency is also the voucher-administering agency.

Does a PHA receive the admin fee for choosing PBV as part of a RAD conversion?

Does a PHA receive the admin fee for administering PBV as part of a RAD conversion? In other words, the money paid to PBRA is limited to RAD contract rents. Is the money paid to a PHA for PBV include the RAD Contract rents PLUS an admin fee?

Yes, the PHA that administers the PBV contract will receive monthly administrative fees under the Voucher program, beginning in the first full calendar year following conversion. This amount is not funded through the RAD contract rents but is funded from the larger Tenant Based Rental Assistance (TBRA) account.

Ability to Switch from a 3 year to 5 year Phase In (PBV)

Once in RAD PBV and a three year phase in was chosen for our policy, are we able to add to our policy the option to use a five year phase in, due to larger rent increases, to benefit tenants that transitioned into RAD PBV?

You are permitted to establish a 3 year, 5 year, or combination of the two as your phase in policy. However, the policy must be in place at conversion and cannot be modified after conversion. Please see Section 3.10.2 of the RAD PBV Quick Reference Guide.

Transferring of Site-Based PBV Waitlist Following Conversion

When a site-based waiting list is transferred following conversion, am I required to serve all of the existing applicants on the waiting list in their current order before serving any new applicants and without respect to adopted preferences?

No. Once the waiting list is transferred, applications and preferences continue to operate in accordance with applicable regulations and locally adopted policies. As a result, new applicants following conversion may get housed ahead of applicants who were on the public housing site based waiting list at the time of conversion if they qualify for a higher preference even though they are entering the waiting list at a later date. There is no requirement to house all of the people who were on the PH site-based waiting list at the time of conversion before housing anyone else.

Post-Conversion 50058 Submission for PBV

We are preparing to occupy our RAD site, however we do not know the process for 50058 submission. Is there a RAD program code for the 50058? Further should we submit a code "10" when the voucher is issued and a code "1" 50058 when the resident moves in? Also, will be 50058 be submitted as a public housing or housing choice voucher, both have different and distinct reporting information? Without a RAD program code HUD will not be able to actively track the success of the RAD program through the 50058 submission process.

The 50058 should be filled out as it normally is for the Project-Based Voucher program, including completing Section 11 of the Form. In addition, the PHA should enter in line 2N “RADPH.” Action Code 10, Issuance of a Voucher, does not apply under the PBV program

Identifying PBV Units in the HAP Contract

Are PBV units separately identified under the HAP Contract (e.g., unit 101 and 102) and, if so, can they be changed?

Yes, all PBV units are separately identified in the HAP Contract. After the signing of the HAP, the PHA may substitute units, but only in accordance with 24 CFR §983.206.

Maintenance of PBV Waitlist

Can an owner administer the PBV waitlist?

The obligation that the waiting list be maintained by the administering PHA is statutory. A PHA may choose to use a broad HCV waiting list, a PBV waiting list, or a project-specific PBV waiting list, but it is still the responsibility of the PHA to maintain that waiting list.

HCV Administrative Plan Amendment

Should the HCV Administrative Plan also be amended to include the RAD program/language?

If the PHA is going to do a RAD conversion to PBV, the PBV Administrative Plan should be amended to reflect the Agency's plans as part of the 60 Day Milestone. There are no additional RAD requirements.

PBV Vacancy Loss and Damage Claims

Is RAD PBV eligible for vacancy loss and damages claim?

For the PBV program, vacancy loss is governed by 24 CFR 983.352; we did not change the rules for vacancy payments.

RAD and PHA Existing Voucher Funding

How is a PHA's budget authority for the PBV program affected by the RAD program?

The funding for the RAD PBVs will increase the PHA's existing funding for its voucher program. There will be an offsetting decrease in funding under the PHA's public housing ACC. Please also note that the RAD conversion to PBVs is in addition to the PHA's existing ability to project-base up to 20% of its vouchers; that is, the PHA can still project-base up to 20% of its pre-RAD vouchers in addition to the new RAD PBVs.

Small Area FMRs

How can Small Area Fair Market Rents (SAFMR) be used to increase rents in the project-based voucher (PBV) program?

HUD published the SAFMR Final Rule allowing for the determination of Housing Choice Voucher (HCV) payment standards using the Small Area Fair Market Rents (SAFMRs), which are calculated at the ZIP code level, rather than at the metropolitan area. SAFMRs allow for payment standards to be established that more accurately reflect the local market. Implementing SAFMRs is an option PHAs can use to increase PBV rents. When converting assistance to PBV under the RAD and RAD/Section 18 blend programs, PHAs may adopt SAFMRs for the following scenarios: -RAD Rents are higher than 110% of FMR (RAD units) -Reasonable rents are higher than 110% of FMR (Section 18 units) PHAs that are not in designated SAFMR areas (where SAFMR adoption is mandatory) have two options to utilize SAFMRs voluntarily: -Opt-In – A PHA may choose to fully utilize SAFMRs throughout its entire jurisdiction by requesting and receiving approval from their local HUD field office. An Opt-in PHA must decide whether to apply SAFMRs to it’s PBV program or whether to continue using the Metro Area FMRs (MAFMR). -SAFMR-based Exception Payment Standards – A PHA may choose to establish exception payment standards using the SAFMR in just certain ZIP codes within their jurisdiction. This can be done by simple notification to SAFMRs@hud.gov. Exception payment standards must be applied to all vouchers (tenant-based and PBV) in the exception area (i.e. ZIP code). Whether the PHA intends to opt-in or establish SAFMR-based exception payment standards, the PHA must carefully follow the instructions in PIH Notice 2018-01.

HQS Inspections

Prior to completing a RAD/Section 18 Blend and execution of HAP contracts, is it necessary for the PHA to conduct inspections of the units for compliance with Housing Quality Standards (HQS)?

Before units can be placed on the HAP Contract and assistance can be paid on behalf of a household, in lieu of an inspection, a PHA can rely on an owner certification that the owner has no reasonable basis to have knowledge that life-threatening conditions exist in the unit or units. The PHA must conduct unit inspections when needed (e.g., in response to tenant complaints) and Owners must correct any identified deficiencies within timeframes specified in the HAP Contract -- 24 hours for life threatening deficiencies, and 30 days or such longer time as agreed to by the PHA for non-life threatening deficiencies (i.e. the completion of the Work under the RCC) .

Treatment of Over-income Tenants Following RAD PBV Conversion

How are over-income tenants treated following conversion to a RAD PBV HAP contract?

Any existing tenants at the time of RAD conversion may remain in the project, and the unit may remain under HAP, even if the tenant's Total Tenant Payment (TTP) exceeds the Gross Rent. In these instances, the tenant will pay a rent amount equal to the lesser of (a) the applicable FMR, less the utility allowances, or (b) any applicable maximum rent setting requirement the unit is subject to under another federal, state, or local program (e.g., LIHTC or HOME). For RAD PBV units, the unit is removed from the contract after 180 days of the resident paying the Zero-HAP Rent. The unit is re-instated (or substituted for partially assisted properties) if the family leaves. If the family remains and their income decreases, the PHA shall re-admit the family.

Applying OCAF Adjustment During Construction Period

Can a housing authority process OCAF adjustments during the construction period? If so, does the authority take into account any of the construction loans when adding in debt in the excel RAD OCAF tool HUD provides?

The OCAF should be applied every year, including during the construction period. There is no deduction of debt service when calculating OCAF adjustments during the period the owner is making interest-only payments on a construction loan. They would only deduct debt service when calculating the OCAF after they’ve converted to permanent financing.