Notice intended to strengthen protections for residents during conversion process
WASHINGTON – (RealEstateRama) — The U.S. Department of Housing and Urban Development (HUD) today issued formal guidance to Public Housing Authorities (PHAs) and others participating in the Department’s Rental Assistance Demonstration (RAD) on how to meet their fair housing, civil rights and relocation obligations during all phases of RAD’s conversion process. Read HUD’s notice.
RAD was authorized by Congress in 2012 to help stem the loss of public housing units by allowing local housing authorities to convert the current federal subsidy to a more stable long-term financing model for up to 185,000 public housing units. Just as private owners of single- and multi-family housing routinely rely upon debt financing as a means of undertaking physical improvements to their properties, RAD allows public housing authorities to safely leverage other sources of private capital in order to finance rehabilitation or in some cases completely replace distressed public housing.
Fundamental to the design of RAD, current and future residents are provided a robust set of rights and protections, including relocation options during the conversion process and the right to return to the property when repairs are completed. HUD’s notice issued today is designed to guide RAD participants on how to make certain tenants are engaged early, treated fairly, and provided ample relocation options during construction.
Specifically, HUD’s 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.
AD provides mobility benefits for assisted residents of converted properties through the choice mobility option, allowing these households to access tenant-based Housing Choice Vouchers. In some cases, RAD can be a tool for transfer of rental assistance from distressed or poorly selected sites to new sites in high opportunity areas. In all cases, the objective is to better serve low-income residents and the broader community in complying with fair housing, other civil rights, and relocation laws.
In Fiscal Year 2017, HUD is requesting that Congress eliminate the current 185,000 unit-cap on public housing units that can convert without additional HUD subsidy. PHAs have already applied and received initial awards up to this cap and a waiting list has now formed. Eliminating the cap will allow every PHA that wishes to participate the opportunity to leverage capital.
In September, HUD published an interim evaluation of RAD that demonstrated a leverage of nearly $9 for every $1 of public housing funds invested in RAD-converting properties. The report also highlighted that some public housing properties with more serious capital needs will not be able to be sufficiently improved without additional subsidy, which is why HUD is also proposing to provide $50 million to help local public housing agencies finance the deeper recapitalization of tens of thousands of units of public housing. Read HUD’s Interim Evaluation.
HUD’s mission is to create strong, sustainable, inclusive communities and quality affordable homes for all.
More information about HUD and its programs is available on the Internet
at www.hud.gov and http://espanol.hud.gov.