HUD published a Federal Register notice extending the previously established terms and conditions by which HUD will approve a request for the transfer of project-based rental assistance, debt held or insured by HUD, and statutorily required income-based use restrictions from one multifamily housing project that is obsolete or not economically viable to another property or properties that are in better physical or financial condition.
Appropriations acts since 2006 have allowed such transfers. Section 212 of the “Appropriations Act of 2016” gives HUD the authority to approve transfer requests for FY16 and FY17. In FY16, HUD continued to use FY15 published criteria (see Memo, 4/13/15), which covered authority enacted for both FY15 and FY16. For FY17, HUD will continue to use, without revision, the published FY15 criteria.
Key criteria in Section 212 include:
- For occupied units at the transferring property, the number of low income units and the bedroom size of the units at the receiving project must not be less than at the transferring project. In addition, the net dollar amount of federal assistance must be the same. If there are unoccupied units at the transferring property, HUD may allow a reduction in the number of units at the receiving project in order to reconfigure bedroom sizes to meet market demand.
- The transferring project must be either physically obsolete or economically nonviable, as determined by HUD.
- The owner or mortgagor of the transferring project must notify and consult with the tenants residing in the transferring project.
- The tenants of the transferring project who remain eligible for assistance cannot be required to vacate their units in the transferring project or projects until new units in the receiving project are available for occupancy.
- The transfer must be in the best interest of the tenants.
The January 19 Federal Register notice is at: http://bit.ly/2iFnZHb