Rental Assistance Demonstration (RAD) PIH Notice 2012-32

Current Challenges Public Housing Capital repair needs in excess of $25.6B across portfolio, or $23,365/unit Section 9 funding platform unreliable (pro-rations, cuts), inhibits access to private debt and equity capital (deed of trust) 2013 Op Sub Funding is an 81% proration 2013 Capital Fund may see about a 5% reduction Public Housing Compliance requirements continue to be a challenge. There are more PH requirements than in Section 8 Examples: Community Service, Pet Policy…

RAD Authority Authorized as part of the Consolidated Further Continuing Appropriations Act of 2012 (Public Law 112-55) Final program rules outlined in PIH Notice 2012-32 Allows public housing and certain at-risk multifamily legacy programs to convert to long-term Section 8 rental assistance contracts

RAD Authority, cont’d 2 components 1st Component, Competitive: Public Housing & Moderate Rehabilitation (Mod Rehab) 2nd Component, Non-competitive: Mod Rehab, Rent Supplement (Rent Supp) & Rental Assistance Payment (RAP)

Public Housing Conversion Rent Levels ACC Section 8

RAD Provisions After award, must complete a Physical Condition Assessment (PCA) to identify conditions at the property Can use other PH Funding Sources in the transactions Reserves Cap Fund RHF Ownership – Public or non-profit, except to facilitate tax credits Initial Contract Terms – PBRA – 20 years, with mandatory renewals PBV – 15-20, also with mandatory renewals, but PHA also can extend initial contract for additional 15 years Annual Adjustments to rents – based on Operating Cost Adjustment Factor (OCAF), i.e., lock in funding long term with an increase of inflation factor each year (OCAF) Choice Mobility PBV – resident gets opportunity for voucher after one year PBRA – resident gets opportunity for voucher after two years; however, PHA may impose a cap of not more than 15% at any project annually and not more than 1/3 voucher turnover cap. Also, HUD provides a good-cause exemption for up to 10% of conversions for PHAs without a voucher program.

RAD Provisions Exemption from 20% PBV caps for HCV agencies PBV Income Targeting – raised from 25% to 50% the number of families that can be assisted who are not also receiving supportive services exemption Eligibility, Waitlist and Annual Reexaminations PBRA – administered by project PBV – administered by voucher agency Resident Participation funds – must maintain “level of service”, i.e., current funding includes $25 per occupied unit annually Public Housing Requirements go away (PHA plan, Federal Contracting, Section3/Minority reporting after initial conversion)

Application Snapshot

RAD Inventory Toolkit Snapshot

Conversion Steps – Public Housing HUD Publishes Final Notice PHAs submits Excel-based Application to HQ HQ reviews application and requests Field Office input on Eligibility HQ issues awards/Commitments to Enter Housing Assistance Payments Contract (CHAPs) PHAs have 6 months to submit Financing Plan to HQ for review PHA Asset Management Subsidy Administration PBV Project converts Remove from ACC Release DOT Execute HAP Execute RAD Use Agreement Close Financing PIH Voucher Oversight HUD issues RAD Conversion Commitment Multifamily Housing Asset Management Subsidy Administration PBRA

RENTAL ASSISTANCE DEMONSTRATION (RAD)Various Considerations in Choosing PBRA vs. PBV

RAD Web Page RAD Notice, application materials, and additional resources can be found at www.hud.gov/rad Email questions to rad@hud.gov

Rental Assistance Demonstration (RAD) PIH Notice 2012-32