On January 12, HUD’s Office of Multifamily Housing Programs sent a Memorandum to all Multifamily HUD staff providing guidance intended to protect tenants living in buildings participating in both a HUD Multifamily program (such as Project-Based Section 8) and the Low Income Housing Tax Credit (LIHTC) program.
The Memorandum is in response to reports that some owners attempted to terminate the tenancy of HUD-assisted tenants who did not meet LIHTC eligibility guidelines, for example having income greater than the LIHTC program threshold. The Memorandum states that terminating tenancy may only occur in very limited circumstances, as prescribed in regulations and the lease agreement, which do not include failure to meet LIHTC-specific income rules or student eligibility rules.
Advocates have observed that HUD-assisted tenants have been threatened with displacement by owners who obtain LIHTC equity and then seek to remove tenants, citing the lower LIHTC income eligibility threshold. Some tenants were also threatened with displacement when an owner attempted to rescreen them under LIHTC.
If an assisted household becomes over-income in a HUD program, its rent assistance ends, but it may continue to live in the unit paying market rent.
The Memorandum is at http://portal.hud.gov/hudportal/documents/huddoc?id=occupprotectionshudassthsg.pdf