HUD’s Office of Multifamily Housing Programs (Multifamily), which oversees contracts with private owners of HUD-assisted properties, issued its seventh update to its “Questions and Answers for Office of Multifamily Housing Stakeholders: Coronavirus (COVID-19)” on July 31. The previous update was on May 21 (see Memo, 5/26). The latest version updates ten questions and adds five new questions. This article highlights the updated and new questions most relevant to residents and advocates.
Under the subheading “Resident Health,” new Q7 (page 5) addresses whether an owner or agent can require residents to wear face coverings at the property and treat a failure to wear a face covering as a lease violation. Multifamily states that if there is or will be a requirement to wear a face covering, “house rules” must be reasonable and consistent with state and local law and directives from public health officials. Failure to comply with face covering requirements may be treated as a lease violation if the house rules are identified in the lease as an attachment to the lease agreement. Owners and agents may amend their lease terms and/or house rules.
New Q6 (page 5) clarifies that there is no statutory or regulatory basis under the project-based Section 8, Section 202 Supportive Housing for the Elderly, or Section 811 Supportive Housing for Persons with Disabilities program to require tenants to take a health or medical test and disclose results as a condition of tenancy. If an owner or agent thinks there is a basis in state or local law to require testing and disclosure, their legal counsel should provide the local HUD Multifamily Office with the legal authority. Owners and agents can encourage, but not require, tenants to get testing and disclose the results.
Q4 (page 4) is updated to add that if there is a confirmed COVID-19 case, owners and agents are encouraged to provide residents who have a confirmed or suspected COVID-19 case with information on how to care for themselves and when to seek medical attention. Any residents with COVID-19 symptoms, and any other members of these household, should be encouraged to self-isolate and to limit their use of shared spaces on the property.
New Q6 (page 11) describes three types of unemployment compensation provided by the CARES Act, identifying which must be included in annual income determinations.
Pandemic Unemployment Assistance (PUA) is an unemployment benefit for individuals who are self-employed, seeking part-time employment, or whom otherwise would not qualify for regular unemployment insurance (UI). PUA benefits must be included as annual income. Pandemic Emergency Unemployment Compensation (PEUC) provides an extension to regular unemployment insurance (UI) benefits, allowing people to receive up to 13 weeks of additional benefits (extending UI from 26 to 39 weeks). PEUC benefits must be included as annual income.
Federal Pandemic Unemployment Compensation (FPUC) provided individuals who were collecting regular unemployment compensation to receive an additional $600 in federal benefits per week for weeks of unemployment. However, FPUC ended on July 31, 2020. While it existed [and if it is recreated in future legislation] FPUC was not included in annual income determinations.
Moratorium on Evictions under the CARES Act
New Q15 (page 14) reminds readers that the CARES Act allowed owners to be eligible for up to 90 days of mortgage forbearance. While under forbearance, owners or agents cannot require a tenant to vacate, issue a notice to vacate (or evict), or charge tenants late fees or penalties due to late or missed rent payments while under forbearance. In addition, Notice H 20-7 extends these prohibitions to any new, extended, or amended forbearance arrangements due to the pandemic as long as the borrower is under forbearance (see Memo 7/13). That notice also requires owners receiving extended forbearance to inform all residents of the prohibition against eviction solely for non-payment of rent.
Property Review, Inspections, Rent Comparability Studies
Q3 (page 17) is significantly updated, indicating that as of May 22 Multifamily has lifted the suspension of Management Occupancy Reviews (MORs) performed by Performance-Based Contract Administrators (PBCAs) in locations where there are no restrictions by state or local law or ordinance to prevent them from performing these reviews. Q3 establishes an alternative manner for conducting a MOR.
- Until September 30, 2020, Multifamily will allow PBCAs to conduct on-site MORs, without entering resident units.
- To determine whether Exigent Health & Safety (EH&S) and other deficiencies have been corrected as part of the Real Estate Assessment Center (REAC) follow-up, the PBCA must attempt follow-up on those affected units by directly contacting a the resident by phone or email, and document the results or attempt(s) made on the MOR report.
- A physical on-site visit to the property must still take place to document the physical conditions, general appearance, and security of the property. The visit should include a visual assessment of each building, common areas, and the grounds.
- An on-site, entrance/exit interview with the owner/agent should occur, except where state or local law or ordinances prevent such meetings. Where these interviews are prohibited from occurring on-site, they should be conducted by telephone or email and documented in the MOR Report.
- Tenant file reviews may be conducted remotely when owners/agents voluntarily create and transmit electronic tenant files to the PBCA in accordance with all requirements of Notice H 2020-4.
Financial Audits, Tenant Income Recertifications, and Utility Analyses
Q9 (page 20) deletes the last sentence of the first paragraph, which read “Annual recertifications must not use previous year’s income to determine rent and assistance, except when using streamlined income determinations.” However, see new Q10 below.
The last sentence of the third paragraph is modified to clarify that, “The Total Tenant Payment/Tenant Rent and the assistance payment certified during the interim recertification are effective retroactively to the first day of the month following the date the family’s income changed” (emphasis added). Previously, that sentence read, “The Total Tenant Payment/Tenant Rent and the assistance payment are effective retroactively to the recertification anniversary date” (emphasis added).
New Q10 (page 22) poses the question, “If a resident does not notify an owner or agent of a decrease in income, can the decrease in the resident’s contribution (‘tenant rent’) be retroactive to when the decrease in income occurred?” Multifamily responds stating residents may request an interim income recertification due to any changes in family income that may affect their Total Tenant Payment (TTP) or tenant rent and assistance payment occurring since the last income recertification. Instructions are in HUD Handbook 4350.3, REV-1, paragraph 7-10, B. Following an income recertification, owners/agents must retroactively apply any reduction in rent starting with the first day of the month after the date of the action that caused the decrease in income (emphasis added). For example, if a tenant lost their job on March 4, 2020, then the owner/agent would reflect this change in income starting with the first day of the following month, which would be April 1, 2020. HUD Handbook 4350.3, REV-1, paragraph 7-11 has more information on owner/agent responsibilities when a tenant reports a decrease in income.
“Questions and Answers for Office of Multifamily Housing Stakeholders: Coronavirus (COVID-19)” is at: https://bit.ly/3gurQR0
More about Project-Based Rental Assistance is on page 4-46 of NLIHC’s 2020 Advocates’ Guide.
More about Section 202 Supportive Housing for the Elderly is on page 4-67 of NLIHC’s 2020 Advocates’ Guide.
More about Section 811 Supportive Housing for Persons with Disabilities is on page 4-71 of NLIHC’s 2020 Advocates’ Guide.