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HUD Housing Programs: Tenants’ Rights (The Green Book): 12.2.5.1 Introduction

Because of the normally long waiting list for public housing, the effective vacancy rates in well-managed projects should approach zero, reflecting only the very limited amount of time required to prepare a recently vacated unit for new occupants. In some projects, however, vacancy rates may be much higher. Most often this occurs because of poor management and maintenance policies, such as excessive turnover and inordinate delays in the process of preparing the units for new occupants.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.2.5.3 Strategies to Combat Excessive Public Housing Vacancies

As with demolition or disposition of public housing, the problem of excessive vacancies is one that may be solved by political as well as legal methods and will require the organized effort of project tenants, of applicants denied admission, and of organizations concerned about the shortage of low-income housing. Using tenant and community participation rights in the PHA plan process can improve a PHA’s policies to promote higher occupancy rates.325

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.2.6 Responsible Conversion of Public Housing

Because of the continuing and growing need to recapitalize the public housing stock, programs and policy proposals to replace units with other forms of subsidy will continue to arise at the federal and local level.336 Whatever their promise for addressing the physical conditions of the units, these replacement initiatives necessarily pose risks for tenants and communities, by possibly changing the rules governing affordability, long-term use restrictions, ownership and management, and a wide array of tenant and applicant protections.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.5.1 Introduction

Units can be lost from the Tenant-Based Section 8 Voucher program for a variety of reasons. Two factors that can result in loss of actual Vouchers to the community and possibly to currently assisted households are: (1) PHA underutilization of authorized Voucher units or budget authority that results in fewer units used in the community and could trigger HUD’s reallocation of the funds elsewhere; and (2) changes in Voucher funding formulas or annual appropriations.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.5.2 PHA Underutilization

A PHA that does not use its full Voucher allocation assists fewer families, and applicants must wait longer for housing assistance. In addition, a low PHA lease-up or “utilization rate” may result in less funding for a PHA in future years or prevent a PHA from obtaining additional Vouchers that occasionally become available, which again affects the number of applicants admitted and their waiting time. Finally, a low utilization rate may result in Voucher funding being removed from the jurisdiction and allocated elsewhere, despite unmet local needs.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.5.3 Funding Shortfalls

Each PHA’s Voucher program depends on annual federal appropriations, as well as the formula used to distribute those funds.633 Since 2007, Congress has used a Voucher renewal funding formula that bases each PHA’s annual renewal funding on Voucher leasing (not to exceed the number of authorized Vouchers) and costs for the prior calendar year, adjusted for inflation.634 This policy has reduced funding uncertainty and generally increased utilization rates.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.3.2.3 Prepayments after Restricted Use Period

Most owners of properties with HUD-subsidized mortgages have the unilateral option to discontinue their participation in the program by prepaying the loan any time after 20 years from original mortgage endorsement.364 However, unilateral prepayment is available only where the property is not subject to an additional prepayment approval requirement under federal, state, or local law. The “Prepayment Eligibility” flowchart, Appendix 12C, at the end of this chapter, can help identify which laws apply to new prepayment requests.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.3.2.5 Legal Claims to Challenge Attempted Prepayments

Generally, most conversions to market-rate use are now subject to the owner’s choice. However, in many cases, the existing restrictions on some properties, and the procedural and substantive requirements of federal, state, and any local laws may provide legal claims to delay, inhibit or prevent conversion. Legal claims may be important to achieve some or all of the objectives of tenants; alternatively, the judicial process may not be well-suited to doing so.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.3.3 Conversion Upon Mortgage Maturity

Of increasing scope and concern is the conversion risk posed from the retirement of the mortgage through repayment of the entire principal loan amount over its scheduled term. Most HUD-subsidized loans were for a 40-year term, although some were for 30-year terms, often those that were state-financed rather than HUD-insured. When any loan is fully repaid according to its original amortization schedule, the mortgage and accompanying regulatory agreement are extinguished.

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.3.5.1 Introduction

An owner’s default on the loan and mortgage can threaten HUD-subsidized units by precipitating a foreclosure by HUD and a termination of the property’s use and affordability restrictions. Even where HUD acquires title at the foreclosure sale and seeks to re-sell the property, continued use of the property as affordable housing can be jeopardized.

HUD Housing Programs: Tenants’ Rights (The Green Book): 8.1 Introduction

This chapter discusses several types of PHA Plans: the Annual Plan, Five-Year Plan, Section 8 Administrative Plan, public housing Admission and Continued Occupancy Policy, and the Moving to Work Plan. It further focuses on the PHA Plan process and highlights how residents, advocates and the public can influence important policies governing the public housing and Voucher programs. The last section of this chapter briefly covers other plans that are related to the PHA Plan.

HUD Housing Programs: Tenants’ Rights (The Green Book): 8.2.1 Overview

The Quality Housing and Work Responsibility Act of 1998 (QHWRA) devolved responsibility for administering public housing and Voucher programs to local PHAs.1 In exchange for the increased authority given to PHAs, QHWRA required that PHAs develop a PHA plan that must be approved by HUD.2 The PHA Plan includes information and policies for public housing, the Voucher program, the Section 8 Moderate Rehabilitation program3 and any special allocat

HUD Housing Programs: Tenants’ Rights (The Green Book): 8.2.2.1 Overview

Residents, program participants, advocates and the public may engage in the PHA’s planning process (PHA Plan Process) to understand the PHA’s policies and plans, to make comments that guide the PHA in a manner affecting the most beneficial change and to object, when necessary. Housing advocates should work with PHA staff and governing boards, program participants, tenant councils and RAB members to establish policies and housing programs that benefit low-income program participants and applicants.33

HUD Housing Programs: Tenants’ Rights (The Green Book): 8.2.2.2 Public Housing

QHWRA and HUD regulations require a PHA to establish one or more Resident Advisory Boards (RABs) to assist with developing the PHA Plan.34 A RAB is a board composed of individuals that adequately reflect and represent the residents assisted by the PHA.35 Congress required the establishment of RABs to facilitate a “meaningful and trusting partnership between the PHA and its residents.”36 It anticipated that RABs would be significant and perman

HUD Housing Programs: Tenants’ Rights (The Green Book): 12.3.5.3 Key Issues

Foreclosure or disposition of a HUD-subsidized property inevitably raises critical issues concerning housing quality, affordability, long-term use, and possible displacement. Although the issues facing tenants are similar, the rules, processes and financial resources for the foreclosure and HUD-owned disposition stages will differ, which may in turn require strategic decisions. Foreclosure may be beneficial, allowing ouster of poorly performing ownership and management, and permitting a restructuring of a property’s debt and operating expenses.