RAD Category Search

Search Again

Notice Listings on Transfers of Assistance

Notice Section 1.12.D Financing Plan

Financing Plan. The PHA must submit a Financing Plan within 60 days of the invitation to submit the Financing Plan unless otherwise approved by HUD. The PHA must request a new Concept Call if it does not submit the Financing Plan timely. See Attachment 1A for Financing Plan Requirements. A Financing Plan must be substantially complete in order for HUD to consider the submission.⁸⁸
HUD’s decisions regarding the acceptance of the Financing Plan will be made in HUD’s sole discretion. If HUD determines that a Financing Plan is not feasible and/or that the requirements of the Financing Plan as set forth in Attachment 1A have not been met, HUD will notify the PHA of the deficiencies and request a modified or new submission. If a PHA is unable to submit a complete and viable Financing Plan HUD will revoke the CHAP award.
A PHA will be notified of HUD’s acceptance of the Financing Plan by the issuance of an RCC, conditioned upon firm commitment of financing from the lender on substantially the same terms as those presented with the Financing Plan.65 The RCC will outline the key components of the planned RAD conversion and the conditions that need to be satisfied in order to close the conversion. The RCC will be a template document not subject to negotiation.
The PHA will have 30 calendar days from the date of issuance of the RCC to execute the RCC and return it to HUD. If the RCC is not returned in this time period, it will expire.
Once the RCC is executed, HUD expects that the RAD conversion will close in a timely manner. The RCC will allow 90 calendar days (from the date the RCC is issued to the PHA) in which to close.
The RCC sets out the requirements of the transaction that will ultimately be concluded at Closing. These requirements include such items as: the number of affordable housing units being converted, the HAP Contract rents, the choice of PBRA or PBV HAP Contract, financing terms and Sources and Uses, key features of the Covered Project, and special conditions that must be cleared before closing. The terms of the RCC survive Closing.

Notice Section 1.4.A.12 Transfer of Assistance

Transfer of Assistance. In order to facilitate the financing, development, and preservation of decent, safe, and affordable housing, there are three scenarios under which assistance converted pursuant to RAD may be transferred off of the existing parcel of land (for the purposes of this sub-section, unless specifically stated otherwise, transfer of assistance does not include transfers to an adjacent site): (1) where the PHA requests assistance to be transferred as part of the conversion from Converting Project to Covered Project; (2) post-conversion where a Project Owner requests a partial or full transfer of assistance, or (3) where, as a result of a default of the Use Agreement or HAP Contract, HUD terminates the HAP Contract. In all cases, the transfers of assistance will be subject to the ownership and control provisions described in this Notice.

Approvals of a PHA or owner’s request to transfer assistance will be determined in HUD’s sole discretion, considering the condition and needs of the Converting Project, the nature of the proposed Covered Project, and the impact on the Converting Project's residents. The transfer shall not place housing in neighborhoods with highly concentrated poverty based on the criteria formulated for transfers under Section 8(bb) of the Act.²³ The transfer shall comply with all applicable fair housing and civil rights requirements and all requirements detailed in this Notice, including environmental review (see Section 1.4.A.3 and Attachment 1A), Site and Neighborhood Standards (see Section 1.4.A.7). Changes in Unit configuration (see Section 1.4.A.10), and Accessibility requirements (see 1.4.A.6). See the RAD Fair Housing, Civil Rights, and Relocation Notice (Notice H 2016-17 PIH 2016-17(HA)) for a full description of the up-front civil rights review HUD will perform when a PHA proposes a transfer of assistance. Further, unless otherwise approved by HUD a PHA may transfer units from a public housing project to an existing low-income housing tax credit project within its 15- year tax credit compliance period only if the transfer is necessary to help with the de- concentration of poverty and/or the de-densification of a public housing project. PHAs should be aware that acquisition of the transfer of assistance site for a Federally-funded project is generally subject to the URA and the commercial or residential occupant of such site may be eligible for relocation payments and assistance.

The project to which assistance is transferred will be subject to all of the contract terms as described in the HAP Contract, RCC, and RAD Use Agreement.
1. Transfer at Conversion. Where a PHA proposes assistance to be transferred to a new site as part of the conversion, this information must be included in the PHA’s Five Year, Annual, or MTW Plan, or as an amendment to the FIve Year or MTW Plan or significant amendment to the Annual Plan and must be consistent with the Consolidated Plan. In a conversion where residents will remain in the Converting Project (i.e., the current public housing site) until the rehabilitation or construction of the Covered Project (i.e., the receiving site) is complete, the PHA and Project Owner must submit a request with their Financing Plan to either a) enter into the HAP contract at the close of construction financing at the Covered Project and, if residents will continue to occupy the former plublic housing units until construction is complete, execute a Master Lease beween the Project Onwer (Lessee) and PHA (Lessor) for the unit with lease payments made from Rehab Assistance Payments for other available funds or b) with HUD approval, enter into a contractual agreement regarding delayed conversion ("Delayed Conversion Agreement"), pursuant to which the Converting Project will remain as public housing while occupied by public housing residents during construction of the new site and the entire HAP Contract will be executed and effective as construction is completed and units are ready for occupancy. Please note that a Delayed Conversion cannot accommodate "staged" effective dates for distinct clusters of units.²⁴. HUD will approve such requests in its sole discretion, based on sufficient demonstration that it is necessary to facilitate conversion.
  
  When the assistance will be transferred at execution of the HAP Contract (including to an adjacent site), the PHA must submit as part of the Financing Plan, a brief narrative describing its plans for the Converting Property. Generally, a PHA's plans must propose for HUD's review one of the following:
  1. Release the Declaration of Trust and place the property under an alternative restrictive covenant at closing that, generally will;
    1. Be recorded in a superior position to all other liens on the property that could compromise the applicability or enforceability of the alternative restrictive covenant;
    2. Run for a period of twenty years after which it will extinguish by its terms;
    3. Requires that either:
      1. the use of the property be restricted to Affordable Housing Purposes, which restriction shall apply to any successor owners of the property, or
      2. where the property is not used for Affordable Housing Purposes, any net income generated from the property, including through lease agreements, be restricted to Affordable Housing Purposes, which restriction shall apply to any successor owners of the property; Require that for the duration of the use restriciton, HUD approve any changes in ownership to confirm ongoing compliance with the use restriction;
    4. Require that, for the duration of the 20 year use restriction period or until the property is sold at Fair Market Value (whichever is shorter), the PHA retain records of and annually report to its board regarding the use of the property (including any use for Affordable Housing Purposes) and any proposed sale of the property; and further require that until any proceeds from the property are fully expended, the PHA retain records of and annual report to its board the net income generated from the property, the proceeds of any sale of the property, and the use of such funds for Affordable Housing Purposes. HUD will require such records whenever HUD approval is needed for sale or transfer of the property or upon request; and
    5. Permit a subsequent removal of the alternative restrictive covenant with HUD approval under the following situations:
      1. for sale of the property at Fair Market Value (or equivalent market valuation, e.g., negotiated sale) as long as the proceeds are restricted to Affordable Housing Purposes, or
      2. when replaced with an alternative restrictive covenant (e.g., LIHTC extended use agreement) that, in HUD's determination satisfies the Affordable Housing Purposes requirement.
  2. Retain the Declaration of Trust and separately demolish and/or dispose of the Converting Property under section 18 of the Act or dispose of (retain) the Converting Property under 2 CFR part 200 (see Notice PIH 2016-20); or
  3. Release the Declaration of Trust at conversion in order to imminently sell the original property at Fair Market Value (FMV) (or equivalent market valuation) with a plan to use the proceeds from the sale for Affordable Housing Purposes.
  Until expended, the PHA must place any proceeds in an account subject to a HUD-51999, General Depository Agreement, which specifies the insurance and security investment requirements.
2. Transfer After Conversion. In general, a Project Owner may only request a transfer of assistance to HUD after 10 years from the effective date of the initial HAP Contract. A Project Ownr may submit a transfer request if it is needed as a result of eminent domain proceedings, natural disasters, unforeseen events or as otherwise approved by HUD (for example, if HUD provided approval of a future transfer prior to conversion). HUD may consider, and approve with such conditions as HUD determines appropriate, a partial or complete transfer of assistance to a new location if the new location complies with applicable site selection standards. Substantially all units covered by the initial HAP Contract must remain or be replaced as a result of the transfer Residents of the original location at the time of the transfer request shall not experience a loss of rental assistance. PBV-assisted families living at the property upon termination of a PBV HAP Contract have a statutory right to receive a tenant-based voucher and to certain tenancy protections.²⁶ (A family may voluntarily decline the tenant-based voucher and accept a PBV unit at the new location but may not be required to do so.) Termination of a PBV contract is not cause for issuance of additional tenant-based voucer assistance from HUD. PHAs and owners contemplating RAD PBV transfers after conversion must take the PBV families' right to tenant-based voucher assistance into consideration and ensure that there will be sufficient resources available to the PHA to both effectuate the transfer and meet the PHA's obligation to provide tenant-based vouchers to those families that wish to receive them. Subject to the availability of appropriations, PBRA-assisted families living at the property upon termination of a PBRA HAP Contract that met the eligibility requirements for voucher assistance may receive tenant-based tenant protcection vouchers (TPVs) in the event the termination of the original PBRA HAP Contract qualifies for issuance of such vouchers. If applicable, any lender to and/or investor in the Covered Project must approve the transfer of the assistance. In the event of transfer of all RAD units, a RAD Use Agreement will be recorded encumbering the new location to which assistance is transferred and HUD shall consider appropriate modifications to the original RAD use Agreement.
3. Transfers as a Result of Default. In the event of default of a Covered Project’s Use Agreement or HAP Contract, HUD may terminate the HAP Contract and transfer the assistance to another location. HUD will determine the appropriate location and owner entity for such transferred assistance consistent with the statutory goals and requirements of the Demonstration. As to the events of breach of the RAD Use Agreement, HUD will avail itself of such legal actions as described in the RAD Use Agreement.

Documents on Transfers of Assistance

Your search did not return any document references on Transfers of Assistance.

Webinars on Transfers of Assistance

Your search did not return any webinars on Transfers of Assistance.

Questions on Transfers of Assistance

Transfer of Assistance for Mod Rehab Component 2 Conversion

We have a 47 unit mod rehab project that may be interested in redeveloping under RAD at another site. Is this permissible under RAD?

Yes, transfers of assistance are permitted for Mod Rehab RAD conversions. See Section 2.4(I) in the RAD Notice for scenarios under which assistance may be transferred to another site.

Classification of a Transfer of Assistance to Existing Commercial Building

For the purposes of the FHEO New Construction review requirements, is the transfer of assistance to an existing commercial building (that will be converted to residential use)considered new construction?

Yes. For purposes of RAD, this scenario would be treated as new construction since the use of the existing building is changed from commercial to residential and thus it would be subject to an FHEO Site Selection & Neighborhood Standards review for New Construction.

Certification Requiremetns for a Transfer of Assistance to Existing Building

If a Transfer of Assistance is to an existing apartment complex (instead of new construction), what Site and Neighborhood standards apply to determine whether that existing apartment complex meets FHEO requirements?

For all transactions that are converting the assistance of an existing structure (whether on-site or through a transfer of assistance), the PHA must provide a certification that the site complies with the Site and Neighborhood Standards for existing or rehabilitated housing. This certification must be included within the PHA’s Annual or Five Year Plan.

Tenant Refuses Unit at Transfer of Assistance Site

We are moving tenants under Transfer of Assistance. If we offer the dislocated tenants a new unit at the receiving site and they refuse the new site is our obligation terminated? What if we offer a voucher after the refusal, are there any other obligations long term. (We would still offer relocation payment.)

In the situation you mention, your obligation is limited to the relocation assistance that you provided in the RAD Notice of Relocation. You may choose to, but are not required to, offer relocation assistance in addition to what you provided in the RAD Notice of Relocation .You should consult with local counsel regarding any local legal actions regarding legal actions/termination of assistance.

Waiver of Requirement to Wait 10 Years Prior to Transferring Assistance After Closing

A PHA is proposing a straight conversion, but would like to potentially transfer the assistance post-conversion (perhaps in 2 to 3 years). The Notice has a 10-Year lockout on transfer of assistance post-conversion. Would a waiver to the 10-Year prohibition be possible?

The provisions of the Notice concerning transfer of assistance (see in particular pages 32-34 of the Notice REV-2) presume that a transfer of assistance will be appropriate for consideration by HUD only when it is not feasible to make the existing property viable long-term. However, your question indicates that it is possible to preserve the property long-term via RAD, so it is not apparent why a transfer of assistance might be appropriate for HUD to consider. Moreover, the Notice is clear that any transfer of assistance is subject to HUD's case by case decision, in HUD's sole discretion. Accordingly, HUD will not consider requests for transfer of assistance except on a case by case basis, and except when the PHA is ready to provide full details of the proposed transaction. Note that post-conversion, the PHA would need to submit a waiver request, with "good cause", to allow for transfer of assistance prior to 10 years.

Transfer of Assistance to Site Outside of PHA’s Jurisdiction

Can a PHA do a RAD Transfer of Assistance to sites outside the jurisdiction of the PHA provided that the receiving jurisdiction and the state agency overseeing vouchers approves?

See the discussion of Transfer of Assistance in the Notice (including in particular, pages 31-32 of the Notice REV-2). HUD approvals for Transfer of Assistance are made case by case and in HUD's sole discretion. The site will also be subject to site and neighborhood standards. If you would like to discuss a specific proposal for Transfer of Assistance, please contact the RAD Team at RAD@hud.gov.

Review Requirements for Dispositions with a Transfer of Assistance

Does an environmental review need to be done on dispositions in transfer of assistance?

Yes. If HUD is taking a federal action, an environmental review is required unless there is a categorical exclusion in the applicable regulation (Part 50 or Part 58) that specifically excludes that action from all or part of environmental review requirements. For example, some dispositions may be partially excluded from environmental review (categorically excluded subject to the Federal laws and authorities cited in 24 CFR 50.4 or 24 CFR 58.5) if the structure or land disposed of will be retained for the same use. The review will be conducted based on the reasonably forseeable use of the land or structure that will be disposed of.

Resident Protections for Transfers of Assistance to an Existing, Non-Public Housing Site

When there is a transfer of assistance (ToA) to an occupied, non-public housing site, are occupants of the receiving site entitled to RAD or other protections?

When the project-based assistance is transferred from one site (transferring site) to another (receiving site) in connection with a RAD conversion, generally, residents of the transferring site have protections and rights under RAD. Occupants of the receiving site are not generally entitled to RAD protections and rights due to the incoming assistance. However, if acquisition, rehabilitation or demolition is planned and will cause occupants of the receiving site to move, the Uniform Relocation Assistance and Real Property Acquisition Policies Act (URA) may apply. In that event, the project owner is required to provide a General Information Notice (GIN) to occupants of the receiving site “as soon as feasible”. Under these circumstances, HUD anticipates that “as soon as feasible” will generally mean no later than when the site is identified to receive the proposed transfer of assistance in connection with the RAD conversion. Where a receiving site was not identified in the initial RAD application or CHAP, a GIN should be provided at the time the site is identified, or more specifically, when the PHA submits a revised CHAP application identifying the site, but no later than 30 days after submitting the revised CHAP application identifying the receiving site. Project owners and PHAs should be mindful that although occupants of the receiving site may not be eligible for RAD related protections and assistance, occupants that are required to move may be protected and eligible for relocation assistance and payments under the URA. In some cases, where CDBG or HOME funds are involved, those occupants may also be protected and eligible for relocation assistance and payments under section 104(d) of the Housing and Community Development Act (section 104(d)). Additional information and resources on the URA and section 104(d) are available on HUD’s Acquisition and Relocation website at www.hud.gov/relocation

Moving Residents of a Transfer of Assistance Conversion to a Section 8 Property Owned by PHA

The Housing Authority will be doing a transfer of assistance. However, some residents may decide that they would rather not relocate to the Transfer of Assistance site. If a resident does not wish to move to the Transfer of Assistance site, may the PHA allow these residents to initiate a move to other nearby project-based Section 8 RAD housing owned by the PHA? If so, can such moves be treated by the PHA similarly to a “Resident Initiated Public Housing Transfer Related to the RAD Transaction” as described in Section 7.4 of the RAD Notice Regarding Fair Housing and Civil rights Requirements and Relocation Requirements (PIH 2016-17)?

We believe this is addressed on pages 45-46 of the RAD Relocation Notice- see excerpt below. If this scenario applies to your project, please contact your RAD Transaction Manager so that HUD approval can be obtained. - "If HUD determines that the distance from the Converting Project to the site of the Covered Project is significant and the resident could not reasonably be required to move to the new site, then HUD will require the PHA to adjust project plans to accommodate the resident in an assisted unit (e.g., a public housing unit, some other project-based Section 8 unit or a market unit 46 with a housing choice voucher) within a reasonable distance of the site of the Converting Project. HUD will evaluate whether this requirement applies on a case by case basis, considering whether the distance would impose a significant burden on residents’ access to existing employment, transportation options, schooling or other critical services. Accommodating the resident may also be satisfied by the resident’s consent to an alternative housing option pursuant to Section 6.10. The requirement set forth in this paragraph is in addition to all protections, including, for example, the offer of comparable replacement dwellings, which are required in all instances where a transfer of assistance is subject to the URA and/or Section 104(d)."

Use of Tax Assessor's Value for Property Transfer

When, under RAD, a property is transferred for FMV, can the PHA use the tax assessors' value (as opposed to appraised value)?

The PHA should use an appraisal to establish FMV.