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HUD's Final Notice PIH 2012-32 for the RAD Program

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HUD published its final notice (Notice PIH 2012-32) for the Rental Assistance Demonstration (RAD) Program. A copy of the final notice may be found here: http://portal.hud.gov/huddoc/pih2012-32.pdf

The RAD program was originally authorized under the FY 2012 appropriations legislation.  On March 8, 2012 HUD posted and circulated its draft RAD Notice (Notice PIH 2012-18) for public comment.  The final notice (Notice PIH 2012-32) takes the public comments on Notice PIH 2012-18 into account and makes chances to the notice language accordingly.

The first component of the Demonstration allows HUD to convert public housing and mod-rehab properties to long-term project-based Section 8 contracts under the Multifamily Assisted Housing Reform and Affordability Act Of 1997 (MAHRA) or to project-based housing choice vouchers.  Notice PIH 2012-32 makes several changes to the first component of Notice PIH 2012-18, including:

P Providing more flexibility in the use of PBVs;

Providing more flexibility in the Choice Mobility incentives and preferences, while reducing the percentage of turn-over vouchers that can be used for this provision;

Expanding the descriptions of required resident notifications, protections, rights, self-sufficiency services, and waiting list procedures;

Modifying the required Financing Plan benchmarks and processing requirements to be more compatible with a wide variety of sources of financing

Eliminating the need to seek HUD approval of a change in project configuration prior to submission of a RAD application.

Modifying the application ranking factor for capital needs so that the point scale accounts for a broader range of capital needs that are proposed to be undertaken;

Allowing Mod Rehab owners to designate a priority project application; and

Providing expanded detail on the transfer of HAP contracts to other projects.

The second component of the demonstration also allows RAP and Rent Supp properties that have lost their rental assistance or long-term affordability restrictions after October 1, 2006 to be eligible to convert their tenant protection vouchers to project-based housing choice vouchers in FY 2012 and 2013. Notice PIH 2012-32 makes several changes to the second component of Notice PIH 2012-18, including:

Allowing owners to secure another PHA to administer the PBVs in the event that that the local agency does not consent;

Providing additional instruction on the inclusion of unassisted units if Enhanced Vouchers are offered during an eligible mortgage prepayment;

Clarifying that Rent Supp or RAP contract units occupied during the 24 months prior to contract termination may be included in a RAD conversion of assistance;

Creating a process for allocating limited TPV resources to projects with Rent Supp or RAP contracts with expiration dates after September 30, 2013 when an owner requests to prepay the mortgage;

Allowing HUD to review and apply deconcentration requirements if the conversion results in an increase in the number of units receiving assistance above the average for non-RAD project-based assistance;

Enhancing tenant consultation requirements;

Clarifying the requirements for 12-month notification of opt-out for Mod Rehab projects; and

Changing the centralized processing system.

Owners of Public Housing and Mod Rehab properties applying for conversion under the first, competitive component of RAD should submit applications during the Initial Application period-September 24 to October 24, 2012. Owners of Rent Supp, RAP, and Mod Rehab properties seeking to convert assistance under RAD’s second, non-competitive component will be able to submit conversion requests immediately under the revised rules of Notice 2012-32.

Finally, the Notice clarifies that the related contractual documents, including the Use Agreement and Housing Assistance Payments (HAP) contracts will be posted for comment at a later date.

A copy of the Federal Register announcement may be found here: http://www.gpo.gov/fdsys/pkg/FR-2012-07-26/pdf/2012-18307.pdf

If you have any questions, please contact RAD@HUD.gov

HUD is also working on an FAQ for the final RAD notice, which will be available here: http://portal.hud.gov/hudportal/HUD?src=/RAD

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