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Copyright 2003 Ansel Publications.
All rights reserved.
REAC and HAP Payments
Discussed in Industry Meeting
The AAPA System, late HAP Payments, residual receipts and
REAC inspections were the subject of an industry meeting conducted
by new HUD Deputy Assistant Secretary for Multifamily Housing
Stillman Knight. In
response to concerns HUD officials have been hearing recently from
property owners and managers, Knight clarified several points that
are problematic on-site.
Below 60 REAC / DEC Referral
Protocol
REAC inspections have the most common problems in the affordable
housing industry lately. Knight emphasized the department=s
intention to correct mistakes made during inspections and to work
with owners and managers to create solutions to troubled properties;
it was not the intention of HUD to take properties back into their
inventory. Points highlighted by Knight at the meeting included:
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Referral to
the Enforcement
Center is at the discretion of the HUB director;
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2530 flags are
not automatic;
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REAC
inspection reports should be thoroughly read for errors and
brought to the attention of HUD immediately if an error is
suspected.
2530 and
APPS System
To eliminate the need for excess
paperwork, HUD will soon issue a regulation that requires all
2530 submissions in the Active Partner Participation System be made
electronically. The electronic system is expected to be fully
operational by January 2004 and an interactive training program for
APPS is expected in October. A participation review committee
will meet every six weeks to handle errors such as flags that
property staff feel is
unfair or incorrect. The
new APPS process is set up to only accept complete forms and will
not allow incomplete forms to be submitted, thus eliminating
resubmissions because of errors
and preventing snags in the system. Owners
and managers who wish to begin loading the 2530 into their systems
should contact James Collins and Lauren Hughes at HUD
headquarters at 202-708-1320.
Late HAP
Payments
Because of the 2003 appropriations process and having to calculate
the amount of recaptures, HUD
has a 30-45 day backlog on contracts and HAP payments are often
late. Funding must be
funneled first through the Office of Management and Budget, which
parcels out money to HUD instead of allowing a large lump sum
payment. Since contracts cannot be rendered until funding is
available, contract administrators execute contracts 120 days in
advance and attempt to prepare paperwork so the money is available
as soon as it is received.
Residual
Receipts
Knight said that it has come to the attention of Asset management
staff in Washington that field decisions regarding residual receipts
are causing problems. To
combat the problem, field staff have been directed to follow the
policies currently in effect without changes.
Knight said that residual receipts may be used for costs such
as increased insurance premiums, rent increases and real estate
taxes, but HUD
officials do not want them to be used as Agap
financing.
To that end, the department is reviewing ways to minimize residual
receipts and additional guidance will be announced.
HUD
Challenges Center Report
HUD officials recently released a statement that refuted the
result of a study that claimed
the president's
2004 budget blueprint would under fund the housing voucher program
by $1.26 billion dollars and affect 184,000 vouchers for low-income
families. On July 14,
2003, HUD released the statement,
A
Housing and Urban Development Says Center's
Report on Housing Choice Vouchers (Section 8) Funding Erroneous,
to disprove an analysis done by the Center on Budget and
Policy Priorities. The HUD statement claimed that:
- The Center's
report uses incomplete data to draw erroneous conclusions;
- For two years, HUD has
substantially increased funding for the Housing choice voucher
program and the department's
2004 budget requests $990 million more than is currently funded
for housing more than 1.9 million families;
- HUD remains committed to ensuring
the Housing Choice Voucher program serves low‑income
families across America.
In response, the
CBPP said that the figures used in their report came directly from
the most recent HUD
statistics concerning the number of vouchers in use and the average
cost of these vouchers. The statistics were compiled by the
department in March and April 2003 using data from housing agencies
across the country. HUD
uses this data to determine it's
funding to housing agencies for vouchers. The discrepancy in
the differing results can be explained by available statistics.
Because the HUD budget request was constructed last fall, officials
relied on available data from as far back as 2001 and so had numbers
that were not as accurate as in the CBPP report.
Copyright 2003 Ansel Publications.
All rights reserved.
HUD
Notice 03-11 (June 12, 2003)
Verification of Immigration Status in HUD-Assisted Properties
This notice provides guidance to owners using the SAVE PC System 2
/ASVS and rescinds
all references in Notice H 95-55, Procedures for Implementing
Section 214 of the Housing and Community Development Act of 1980,
as amended - Restrictions on Assistance to Noncitizens, regarding
the touch-tone telephone method for accessing the Department of
Homeland Security's (formerly Immigration and Naturalization
Service), Systematic Alien Verification for Entitlements Program
to perform verification of immigration status of non-citizens at
admission and annual recertification in assisted housing programs.
On March 31, 2003, DHS phased out the touch-tone telephone method
and replaced it with the personal computer method. All users
were transitioned into the new SAVE PC System 2 Automated Status
Verification System 2 (ASVS).
PIH
Notice 03-17 (June 20, 2003)
Reinstatement of the Community Service Requirement
This notice reinstates the public housing community service and
self-sufficiency requirement authorized under Section 12 of the
United States Housing Act of 1937, which is intended to assist adult
public housing residents in improving their own economic and social
well-being and give residents a greater stake in their communities.
Federal
Register FR-4851-N-01 (July 1, 2003)
NOFA for the Lead Hazard Reduction Demonstration Grant Program
This notice announces $49,675,000 for the Lead Hazard Reduction
Demonstration Grant Program to assist areas with the highest lead
paint abatement needs in undertaking programs for abatement,
inspections, risk assessments, temporary relocations, and interim
control of lead-based paint hazards in eligible privately owned,
single family housing units and multifamily buildings occupied by
low-income families.
Rural
Housing Service 03-19316 (July 1, 2003)
NOFA for Rural Community Development Initiative
This notice announces the availability of $6 million of grant
funds for the RCDI program through the Rural Housing Service.
Applicants must provide matching funds in an amount at least equal
to the federal grant. These grants will be made to qualified
intermediary organizations that will provide financial and
technical assistance to recipients to develop their capacity and
ability to undertake projects related to housing, community
facilities, or community and economic development. This
notice lists the information needed to submit an application for
these funds.
HUD
Notice 03-14 (July 3, 2003)
Extension of Section 8 Project-Based Rent Adjustments Using the
AAF
This notice announces the reinstatement and extension of HUD
Notice H 2002-10, Section 8 Project-Based Rent Adjustments Using
the Annual Adjustment Factor, extended until July 5, 2004.
HUD
Notice 03-13 (July 15, 2003)
Extension of Guidelines for Calculating Section 236 Excess Income
This notice announces the
extension of Notice H 02-14, Guidelines for Calculating and
Retaining Section 236 Excess Income as clarified by Notice H 02-09,
Technical Corrections to Notice H 01-07 issued May 10, 2002.
Federal
Register FR-4792-I-01 (July 30, 2003)
Distribution of Tax Credit Proceeds
This interim rule amends regulations for funding in project
completion that require funds provided by the mortgagor must be
disbursed in full for project work, material, and incidental charges
and expenses before any disbursement of the mortgage proceeds.
An exception is made for federal, state, or local government or
instrumentality grants or loans. These grants or loans need
not be fully disbursed before the disbursement of mortgage proceeds,
upon approval of the Assistant Secretary for Housing-Federal Housing
Commissioner. This rule provides that the mortgagor's equity
from the sale of low-income housing tax credits or historic tax
credits, or both, need not be fully disbursed before the
distribution of mortgage proceeds.
HUD
Notice 03-16 (July 31, 2003)
FY 2003 Policy for Capital Advance Authority Assignments
This notice announces the Fiscal Year 2003 Policy for Capital
Advance Authority Assignments, Instructions and Program Requirements
for the Section 202 and Section 811 Capital Advance Programs,
Application Processing and Selection Instructions, and Processing
Schedule.
RECENT HOUSING ISSUES
IN COURT
Although the Fair Housing Act has been in effect for more than 30
years, a Louisville homebuilder was found guilty recently of
noncompliance when he was constructing housing units that were
accessible to the disabled.
The U. S. District Court ruling requires that the builder renovate
to make the units accessible by widening doorways and adding ramps
to accommodate wheelchairs. The architect of the property also
agreed to send a letter explaining the necessity and importance of
fair housing building laws to all architects in Kentucky.
The Fair
Housing Council and Center for Accessible Living in Louisville
initiated the civil suit six years ago, funded in part by a $600,000
grant from HUD.
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LEGISLATIVE NEWS |
Copyright 2003 Ansel
Publications. All rights reserved.
Housing Choice
Vouchers At Risk
Despite Congressional claims of support for vouchers and a HUD
commitment to vouchers, the housing choice voucher program was
under funded in the House's
version of the HUD appropriations bill passed in late July.
The
House approved $583 million less than is needed to renew the
vouchers currently in use; a number that affects up to 85,000
low-income households nationwide. Overall the voucher
program was funded at $18.4 billion and was an improvement
over the administration's
budget that was $1.26 billion short and would have left
180,000 low-income families without housing. In the
past, the federal government has pledged to renew all existing
vouchers. A HUD statement released in early July claimed
that the department is committed to ensuring the housing
choice voucher program serves low-income families across
America.
Since the House
budget also did not approve funding for existing vouchers that
are not in use at the beginning of 2004, up to 95,000 vouchers
that might have been used for families on waiting lists will
not be funded.
The House bill also
denied an administration request to convert the voucher
program into a block grant administered by the states.
While the voucher program lost $1.26 billion, the president's
budget called for $560 million to be used in programs such as
capacity building grants for states and new tenant protection
vouchers for families that lose housing assistance under other
HUD programs.
The
full HUD budget received $31.8 billion not including offsets,
an increase of $817 million from last year's
budget and a $96 million increase over the administration's
budget blueprint. Housing
industry leaders are already calling the funding inadequate
since housing costs have increased in the past year.
The House budget
did not approve the administration's
attempt to decrease funding for affordable housing programs
such as the Rural Housing and Economic Development program
which was not funded in the president's
budget for the past two years.
Funding for that program as approved at the 2003 level
of $25 million. Two
of the president's
pet projects did not receive the full request. The
Samaritan Initiative that would provide housing and services
for long-term homeless families and individuals was requested
to receive $50 million in the president's
budget but was not approved by the House. The American
Dream Down payment Initiative providing down payment
assistance to first-time homebuyers was funded at $125 million
instead of the $200 million requested in the president's
budget.
A
Senate version of the HUD appropriations bill has not been
scheduled for the a vote on the Senate floor.
Section
8/236 Attacked in Waste, Fraud, and Abuse Report
A recent report from the House Financial Services Committee
found that the Section 8 and Section 236 rental assistance
programs and the rural rental assistance
program administered by the Rural Housing Service are the most
likely programs to have unliquidated obligations.
According to a 2003
budget resolution, the committee was required to find areas of
waste, fraud and abuse in mandatory programs under the
committee's
jurisdiction. Using testimony from HUD and USDA officials
during a waste, fraud, and abuse hearing conducted by the
Subcommittee on Oversight and Investigations in June, the
committee found that the best way to save money was to target
unliquidated obligations, which are funds that have been
appropriated for purposes such as long-term contracts, but
which have not been disbursed.
A report from HUD's
Inspector General also used in the committee's
report claimed that HUD officials are not recapturing
unliquidated obligations in a timely manner and that errors in
the billing process cause overpayments in rental subsidies.
As a result, the Inspector General has announced efforts to
detect and prevent fraud in housing assistance
programs.
Dissenting
opinions in the report claim that the housing programs
targeted are discretionary,
not mandatory. The minority dissenters also claimed
that the resolution requested addressing waste, fraud and
abuse while the committee simply ordered the respective
departments to rescind unspent money; a demand already covered
by existing laws.
The
minority also claimed that targeting unobligated funds and
requiring more
rescissions will only decrease funding for under funded
housing programs which serve the elderly, disabled and
low-income families.
Rural Housing
Funding Too Low
Although few programs were cut, appropriations for the Rural
Housing Service remain to low to cover the funding needs of
the agency after both the House and the Senate approved their
version of the RHS appropriations bill.
The
House version, H.R 2673, Section 515 rural rental assistance
was funded at about the same level as 2003 at $116.5 million
but more than the administration's budget cut to $71 million.
The Senate approved a bit less at $115.1 million.
The
House approved $731 for Section 521 rental assistance to the
Senate's
$721.3 million, which was the same as in 2003.
Section 538 rental housing guaranteed loans were level funded
at $100 million in both the houses.
At
a recent hearing before the Subcommittee on Oversight and
Investigations, Thomas Dorr, Under Secretary for Rural
Development at the U.S. Department of Agriculture, claimed
that the USDA's
Rural development program is the venture capitalist for rural
America and it promotes homeownership and multifamily housing
in rural areas. Problems experienced by some of the rural
multifamily programs include the loss of rural housing as 64
percent of the Section 515 property owners become eligible to
prepay their subsidized mortgages and leave the affordable
housing program; better methods to forecast the need for
rental assistance; and allowing the secondary mortgage market
to participate in the Section 538 loan guarantee program.
Possibly
in an effort to counter a shift of RHS to HUD administration,
Dorr said that the USDA is A
uniquely
situated
to address housing needs in rural areas. Effectively
managing the funds the department currently receives is a
priority, Door said, but campaigning for additional funding
was also necessary.
Omnibus
Bill To End Homelessness
An omnibus
bill that would end homelessness, provide job training, child
care and public transportation has made its way into the House
before the August recess.
The
main provision of the Bringing America Home (H.R. 2897) would
be to establish a national housing trust fund for communities
to build, rehabilitate and preserve 1.5 million homes over the
next 10 years. Other provisions include job training,
vouchers for child care and public transportation, emergency
funds for families facing eviction, access to health, civil
rights protections, and Congressional support for living
incomes.
A
bill was introduced in the House earlier this year to
establish a national housing trust fund that would build,
rehabilitate and preserve 1.5 million units of rental housing
for the lowest income families over the next ten years.
The bill, H.R. 1102, has 205 cosponsors and more than
4,390 organizations and local leaders have promised their
support.
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TRACS NEWS |
Copyright 2003 Ansel Publications. All rights reserved.
TRACS and the New Handbook
After the release of the revised HUD Handbook 4350.3, it
may take up to 18 months to fully implement changes affecting
the TRACS system. TRACS participants should disregard
matters requiring system enhancements effecting contract
renewals or the payment process, but should continue using
data formats from existing 201B requirements to submit data.
TRACS officials are compiling a list of fatal errors.
Potential system changes and revisions and a timetable for
implementing revisions will be announced soon.
The TRACS help line has changed to combat
any problems and all calls will be answered by a technical
support staff member.
Minor Punctuation Change for On-line
Web Applications
Managers submitting TRACS information online are being
instructed to use a semi-colon instead of a comma for the
delimiter in the Download option for On-line web applications.
The change affects the following TRACS Internet Web
applications:
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TRACS Certification Query
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TRACS Move-in/ Move-Out Query
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TRACS Project Evaluation Query
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TRACS Tenant Unit Address Query
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TRACS Verification Query.
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Older Submissions Now Allowed
To expedite payment to delinquent
properties, the TRACS system will now allow baseline
certifications with effective dates more than 15 months old.
Fatal edit F0161 has been removed from
the system and TRACS will store those submissions with new
discrepancy code CE262. This code replaces F0161 and
will state: A
Baseline cert with an effect date more than 15 months
old was stored in TRACS.
As priority code A3,
the message is informational only and no further action will
be required.
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510-834-AHMA(2462)