On February 22, the National Affordable Housing Management Association (NAHMA) and other industry partners attended a briefing at HUD HQ to discuss several new HUD initiatives. Here are the highlights of that discussion.
HUDs Workload Sharing Pilot Program is intended to alleviate staff burden, improve operational efficiency and respond more effectively to HUDs customers. HUD is in the process of formalizing the pilot programs to better manage current imbalances in the development and asset management workloads among field offices. Owners and agents will be notified if their project is selected for the pilot (and will be served by a different HUD office).
Multifamily industry representatives expressed concern about the potential for confusion about reassignments. HUD stressed that the pilot program was intended to improve and expedite customer service. Department representatives stated they would manage the redistribution in a way that made geographic sense. Also, HUD was very open to the suggestion from industry representatives that, to the extent possible, portfolios should be kept together.
HUD will report on the pilots at the end of March.
Expedited Processing for Sandy Storm Impacted Areas
HUD will open the door to all lenders in good standing who wish to participate in the expedited processing for Sandy areas. The New York HUB will manage all expedited processing for Sandy areas. The New York HUB Director has full waiver authority.
FHA Multifamily Mortgage Commitment Authority
HUD is using its commitment authority at a rate of 15 percent faster than previous years. Because of the faster burn rate HUDs commitment authority available under the FY 13 continuing resolution will expire in the next two weeks. (The continuing resolution itself expires after March 27.) Starting today, HUD will prioritize commitments for the next two weeks as follows:
· Affordable (Section 8, LIHTC) and Sandy loans;
· A7 loans; then
· D4 loans.
HUD will have additional commitment authority for FY 13 when a new appropriations bill is signed into law.
The meeting did not focus on sequestration. Nevertheless, NAHMA members should be aware that these mandatory across-the-board cuts were written into statutory law under the Budget Control Act (BCA). These cuts must be implemented at the program, project and activity level for each budget account that was not specifically exempted in the BCA. As the law is written, agencies do not have the flexibility to redirect funds from one budget account to another. Senior Administration officials have said there will be widespread furloughs of federal employees as a result of the cuts. In testimony to the Senate Appropriations Committee, Secretary Donovan stated sequestration could cause about 125,000 individuals and families to lose assistance provided under the Housing Choice Voucher program. His testimony also described a number of other negative consequences to low income families and local economies. See: Written Testimony of Secretary Shaun Donovan Hearing before the Senate Committee on Appropriations on The Impacts of Sequestration for more information.
If sequestration takes effect as scheduled on March 1, the Office of Housings multifamily programs will be affected. In the project-based Section 8 program, HUD will try to manage the impact of funding cuts by short-funding of HAP contracts (obligating less than 12 months funding). The funding cuts may also prevent HUD from filling its vacant HUB director positions.
Members should know that the only way to prevent sequestration is for Congress to pass new legislation which either delays, replaces or repeals the sequester. The President would have to sign the legislation into law.
Department of Labor / Davis Bacon
HUD officials met with representatives from the Department of Labor to discuss the possibility of having greater flexibility on when wage rates are locked in. DOL made no commitments to change policies.
The Office of Affordable Housing Preservations top priority is implementing the Rental Assistance Demonstration (RAD) program. HUD is exploring the possibility of centralizing Section 202 Senior Preservation Rental Assistance Contract (SPRAC) processing as well as Section 236 and Section 202 prepayments at OAHP.
Affordable Care Act
The White House is asking federal agencies, including HUD, to conduct outreach on the Affordable Care Act. HUD is hoping owners will help inform tenants about the Affordable Care Act. HUD may be in touch with your AHMA to seek opportunities to provide information about the new healthcare law.