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HUD Housing Programs: Tenants’ Rights (The Green Book): 4.5.1 Overview

Virtually all subsidized tenants residing in public or HUD-assisted housing must have initial and regular certifications of income and family composition.581 Annual recertification is not required for those tenants paying full contract or market rent in a property with project-based rental assistance, Section 236 market rent, 110% of the Section 221(d)(3) BMIR rent, or tenants with fixed incomes.582 Importantly, families on fixed incomes only need to recertify their income every three years.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.5.2 Steps in the Process

The recertification policy for public housing tenants is set forth in their lease, the PHA Plan, and the federal regulations.585 For tenants in HUD multifamily subsidized housing (Project-Based Section 8 tenants and Sections 236 and 221(d)(3) BMIR, Rent Supplement, or Rental Assistance Program (RAP) tenants), the policy and procedures are set forth in the tenant leases, federal regulations, and the HUD Multifamily Occupancy Handbook.586 For tenants with Section 8 administered by a PHA (i

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.4.7 Contract Rent Increases

Under the Voucher program, an owner must notify the PHA of any proposed changes in the amount of the contract rent at least 60 days before their effective date.150 The PHA must also determine that the contract rent is “reasonable” in comparison to the rent for other comparable unassisted units.151 The owner cannot increase the contract rent during the initial term of the lease (ordinarily one year, unless the PHA has approved a shorter initial lease term).

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.5 Project-Based Vouchers

Under the rent rules for the Project-Based Voucher (PBV) program, the amount of rent that the landlord may charge (the “rent to owner”) is effectively capped at the amount authorized by the housing assistance payments (HAP) contract.155 Thus, tenant rent contributions are generally determined in the same way as for the Housing Choice Voucher program, except there is no excess over the payment standard that the tenant must absorb.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.6 Enhanced Vouchers

The Enhanced Voucher program159 is intended to protect residents of certain developments that were formerly HUD-subsidized or assisted under Project-Based Section 8 from displacement when the building’s subsidy ends. It provides eligible tenants with unique Vouchers that they can use to stay in the development or relocate to other housing. Only tenants in residence at the time of the qualifying event (e.g., prepayment or expiration or termination of the project-based assistance) who are income-eligible can receive such assistance.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.7 Section 8 Moderate Rehabilitation

For the Section 8 Moderate Rehabilitation program, most of the same general rules applicable to the Section 8 Housing Choice Voucher program on calculating the tenant’s portion of the rent apply, including minimum rent rules.171 However, as with the other Project-Based Section 8 programs, the key distinction from regular Vouchers is that, because the contract rent is capped,172 the tenant has nothing extra above the contract rent to absorb.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.8.2 Section 236 without Additional Rental Subsidy

For a Section 236 unit without additional rental subsidy, there is a minimum rent (“basic rent”) and a maximum rent (“market rent”).174 Basic rent is based on the cost of operating the project with a hypothetical mortgage interest rate of 1%.175 The market rent approved by HUD for the unit is not actual true market rent, but instead the rent calculated using operating costs and a mortgage with the actual market interest rate at origination.176

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.8.3 Section 236 Rental Assistance Program

The Section 236 Rental Assistance Program (RAP) provides a deep subsidy for tenants whose income is determined to be too low to permit them to pay the approved rent within 30% of adjusted monthly income.180 The few tenants still in this program have their rents set in a manner similar to the Project-Based Section 8 program, i.e., rent is set at the highest of 30% of adjusted monthly income, 10% of monthly income, or the welfare rent.181 See infra

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.9 Section 221(d)(3) BMIR

As with the Section 236 program and other “shallow subsidy” programs, the Section 221(d)(3) Below Market Interest Rate (BMIR) program sets rents based on project costs, which are usually below actual market value but not usually based on a percentage of household income. However, the tenant may receive other subsidies such as Project-Based Section 8 assistance or rent supplement that supports all or just some of the units at the property,183 which may then use income-based rents.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.10 Rent Supplement Program

For the dwindling number of units that still have rent supplements, individual tenant rents are generally income-based, but there is a floor tenant share of rent set at the higher of 30% of monthly adjusted income or 30% of the gross rent (contract rent plus any allowance for tenant-paid utilities).186 Thus, at initial certification, higher-income tenants who need little assistance may be ineligible.187 Residents whose income increases after initial occupancy would simply receive a commensur

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.2.12 HOME Program

Participating jurisdictions may use HOME funds for the construction of units, or for tenant-based rental assistance.193 Each form of assistance has distinct rent rules. The HOME program is one of the programs utilizing the special earned income disregard for persons with disabilities,194 although it only helps those HOME tenants paying income-based rents.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.6.2 Required Tenant Reporting of Changes in Income and Household Composition

Each HUD program has different rules governing tenants’ obligations to report changes between regular recertification. For the PHA-administered programs (public housing, Section 8 Voucher, Section 8 moderate rehabilitation), each PHA can establish its own policy. For the HUD multifamily housing programs, specific changes trigger a reporting obligation. For most programs, these are typically situations that would trigger a rent increase or eligibility for a lesser subsidy or smaller unit.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.6.5 Special Rules for Section 8 Voucher Tenants

Because of the unique rent structure of Vouchers, tenants undergoing interim recertifications are governed by some additional rules and variables reviewed separately here.

If the family unit size increases or decreases during the HAP contract term (i.e., where the tenant does not move), the PHA should not adjust its payment standard or subsidy payment for the unit until the next regular recertification.691

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.7.1 Overview

Verification of income and other information relevant to eligibility for federally assisted housing is clearly important to confirm both the tenant’s rent and continued eligibility. HUD requires verification of Social Security numbers (if assigned) and status under its non-citizen rule. It also requires that all adult household members sign consent and release forms, authorizing third parties to verify information and for HUD to cross-check information with regard to wages, Social Security benefits, and tax returns.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.7.2 Third-Party Verifications of Income and Assets

For all HUD housing programs, the PHA or owner must obtain third-party verification of reported family annual income, the value of assets, expenses related to deductions from annual income, and other factors that affect the determination of adjusted income or income-based rent.703 If third-party verification is not available, the PHA or owner must document the reason in the tenant file.704 The tenant must sign HUD-approved release and consent forms, authorizing any depository or private sour

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.7.3.1 Overview

Congress and HUD have established programs for sharing income data about assisted housing participants with various agencies, and requiring tenants to sign written consent forms authorizing the sharing of such information.714 HUD encourages PHAs and owners to maximize the use of these so-called “up front income verification methods” that rely on computer-generated data.715 From time to time, often in response to budget or political influences, Congress or HUD adopts new policies or practices