Two identical HUD policy notices implement the FY14 Appropriations Act provision that set aside $5 million for tenant protection vouchers for low income households who may have to pay more than 30% of their income for rent at three categories of HUD-assisted multifamily properties in low-vacancy areas. Notice HUD 2014-7 is from the Office of Multifamily Housing Programs and HUD 2014-13 is from the Office of Public and Indian Housing.
The three types of eligible HUD-assisted multifamily housing are those that experienced:
- The maturity of a HUD-insured, HUD-held, or Section 202 loan during FY14 or previous years, and that required the permission of the Secretary in order to prepay a loan. These include Section 236, Section 221(3) Below Market Interest Rate (BMIR), and Section 202 Direct Loan programs.
- The expiration of a rental assistance contract for which the tenants are not eligible for enhanced voucher or tenant protection assistance under existing law. These include properties with a Rental Assistance Payment (RAP) contract that expired before FY12, or a property with a Rent Supplement (Rent Supp) contract that expired before FY2000.
- The expiration of affordability restrictions accompanying a mortgage or preservation program administered by the Secretary. These include Section 236, Section 221(d)(3) BMIR, or Section 202 Direct Loan mortgages that mature during FY14 or previous years, and for which permission from HUD is not required, but the underlying affordability restrictions expired with the maturity of the mortgages. This category also includes properties with stand alone “Affordability Restrictions” that expire in FY14 or that expired in previous years.
Other key provisions in the Notice include:
- Owners of eligible properties must apply for the assistance for residents.
- Requests from owners will be accepted on a rolling basis until funding has been exhausted.
- The tenant protection assistance may be either an enhanced voucher or a project-based voucher.
- Public housing agencies (PHAs) must administer the vouchers. A public housing PHA may decline to participate; if so, HUD will attempt to identify an alternative PHA willing to administer the vouchers.
The $5 million is a set-aside from the $130 million FY14 appropriation for all tenant protection vouchers. A $10 million set-aside was initiated in FY12 (see Memo, 3/23/12 and 4/19/13) by Senators Richard Durbin (D-IL) and Scott Brown (R-MA).