The process that a public housing agency (PHA) must follow when it wants a tenant with an enhanced voucher (EV) to exchange the EV for a Project-Based Voucher (PBV) is the subject of Notice PIH 2013-27.
The Notice clearly states that owners cannot refuse to accept a household’s EV, and that a household cannot be forced to give up an EV if a property will use PBVs.
If a property that has undergone or will undergo a housing conversion action seeks to use PBVs in place of EVs, three requirements must be met:
- The PHA must schedule a briefing for all households potentially affected by a proposed attachment of PBV to their unit. A HUD Field Office representative must attend the briefing in person or by teleconference. PHAs must ensure that people with disabilities have an equal opportunity to participate in the briefing, and that persons with limited English proficiency (LEP) have meaningful access to the briefing.
- A household must have at least 30 days after the briefing to decide whether to keep their EV or voluntarily switch to PBV. A consent form must explicitly acknowledge a household’s consent or non-consent to switch. A unit cannot be included in a PBV Housing Assistance Payment contract if a household decides to keep an EV or does not respond after the briefing
- Certain preservation mortgage prepayment situations allow moderate income households to receive an EV. However, a household with income above 80% of the area median income (AMI) but less than 90% AMI who is elderly or disabled or who lives in an area with a vacancy rate of 3% or less is over-income for a PBV.
Background on PBVs and EVs
PHAs may choose to use up to 20% of their funding for regular “tenant-based” vouchers in order to “project-base” the vouchers, to attach a PBV to a specific unit or property. When a resident moves from a PBV unit, the tenant does not take the voucher assistance with them, as is the case with a regular tenant-based voucher. Instead, the PBV stays with the unit or property for another tenant. The moving tenant is eligible to get another tenant-based voucher from the PHA.
EVs are provided to households living in properties at which there is an “eligibility event” such as an owner: not renewing certain types of Section 8 project-based contracts; prepaying certain types of mortgages; ending mortgage insurance; or, preserving a property through the Mark-to-Market program or other Multifamily Housing Reform and Affordability Act (MAHRA) sections. HUD refers to these types of events as “conversion actions.” Typically, an eligibility event leads to a property charging market rents.
EVs are tenant-based vouchers that differ from regular vouchers in two ways. First, households in properties that have or will undergo conversion actions may remain in the property after the conversion, but must continue to pay toward rent an amount at least equal to the amount they were paying before the conversion. In other words, they might be paying more than 30% of their income for rent. If a tenant with an EV decides to move, they keep voucher assistance, but the EV becomes a regular, tenant-based voucher. Second, HUD will pay the owner the difference between what the tenant pays and the new market rent, which is generally greater than the typical PHA voucher payment standard – the voucher is therefore “enhanced.”
PIH Notice 2013-27 is at: http://bit.ly/J5aiLb