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HUDBlast June 19, 2008 |
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For an archive of HUDBlasts visit RBD online at www.rbdnow.com |
HUD MODEL LEASES QUESTIONS AND ANSWERSSince the May 15, 2008, release of the HUD Model leases, HUD has received numerous questions relating to the use and implementation of the leases. In order to ensure that everyone has access to consistent answers, the Department is providing The HUD Model Leases Questions and Answers document. This document is posted on the Multifamily RHIIP website at: http://www.hud.gov/offices/hsg/mfh//rhiip/mfhrhiip.cfm. We appreciate HUD’s timely response to industry questions. This is a comprehensive document that should be reviewed by staff responsible for leasing activities. Considering how busy most of you are, I thought I would highlight some samples of the information provided. Question 1 HUD posted the leases (revised 12/2007) on May 15, 2008. A RHIIP ListServ announcement was provided to the industry on May 19, 2008. The announcement describes implementation requirements as follows: Owner/agents are to begin using the model leases for new admissions immediately and for current tenants with annual certifications with an effective date of January 1, 2009. Note from RBD: All property managers who use the HUD Model leases provided in HUD Handbook 4350.3 Revision 1 Change 2 must obtain signed copies of the OMB approved lease from all households. Since many of you are in the middle of implementing the new HUD Model lease provided in HUD Handbook 4350.3 Revision 1, Change 2 (revised 6/2007), we have received questions about how to implement this change. Our recommendations follow: § Use the new lease for all new households (MI/IC.) § Starting with your January 2009 annuals (owner/agents have the option of starting this process earlier but not later), you should require all residents to sign the new lease during the annual certification process. If the existing resident is currently housed using the lease revised 6/2007, there is no need to provide notice of lease changes since the lease did not change. If the resident is currently housed using the lease revised 5/2003, then the resident should receive notice of the lease changes in accordance with Chapter 6-12 B4, 5, 6 and 7. 4. A modification to the lease may only be effective at the end of a lease term. The owner must provide the tenant with the approved modifications at least 60 days prior to the end of the lease term. 5. The notice must include a copy of the revised lease or an addendum revising the existing lease agreement. Owners must include a letter clearly stating that the tenant can either accept the modification or move, but that a response is due within 30 days. 6. A tenant must either: a. Accept the modification by signing both copies of the modification and returning one to the owner; or b. Refuse the modification and give the owner a 30-day notice of intent to vacate. 7. If, within 30 days, the tenant indicates that the modification is unacceptable or does not respond, the owner may begin the procedures for terminating tenancy set forth in paragraph 8-13 B of this handbook.” Question 6 addresses a typo on Appendix 4B, HUD Model lease for Section 202/8 and 202/162 PAC Programs (HUD Form 90105-b). The CFR reference was excluded from previously posted versions of the lease. HUD has posted a corrected version of this lease. You can download a copy in Word or PDF format from the HUDClips web site at http://www.hud.gov/offices/adm/hudclips/forms/hud9.cfm. In addition, RBD has updated the lease posted on our web site at http://www.rbdnow.com/chg2leases.htm. Question 25 addresses lease modification based on HUD instruction. Because Appendices 4E, 4F and 4G provide instruction to add multiple household names and to include a Security Deposit payment schedule when appropriate, there is cause to edit the lease. HUD has confirmed that these edits are acceptable. This also applies to the addition of attachments to be referenced as long as the attachments do not conflict with HUD regulations and requirements. For example, including the Pet Rules as an attachment in Paragraph 27 when the property is set aside for the elderly. (Section 8 elderly). See Question 18. Question 29 gives new instruction to those property managers who are working on Section 8 elderly properties. Paragraph 6-5-C-4 of HUD Handbook 4350.3 Revision 1, Change 2 instructs managers of these properties to modify the lease to include the 202/811 pet language. This provides senior and disabled residents and their families with notice that they are allowed to have a pet. Currently, Handbook instruction states that you must modify the lease or incorporate a HUD-approved lease addendum. Clarifications provided in the “Lease Q and A” state that the lease itself must not be modified. If the property is operating under a Section 8 elderly agreement, the owner/agent should create a lease addendum. As long as the language was incorporated in to the lease previously, and the new lease addendum contains the exact verbiage from the 202/811 leases, no HUD/CA approval is required. Do not use the OMB number on the lease addendum. Question 31 provides additional instruction for those property managers using leases developed/provided by Contract Administrators. All properties (except co-ops) must use the HUD Model leases provided on HUDClips. If your CA has provided an alternative lease – usually to address state law requirements – you should be aware of the change in the requirement. HUD now requires that all lease modifications – even those required by state law - are addressed in lease addendums. Do not use the OMB number on lease addendums. These are just a few of the questions addressed in this document. After review, you may want to add this document to Chapter 6 of your HUD Handbook for future reference. MARK Your calendars! HUD/TRACS Industry Meeting scheduledThe TRACS Industry Meeting will be held on Wednesday, October 22, 2008 and Thursday, October 23, 2008 at the HUD Auditorium on 451 7th Street, SW Washington, DC 20410. Information on the Industry Meeting registration and agenda will be posted at a later date. TRACS software changes comingThis fall, the industry will begin the task of converting to TRACS 202c, and the replacement for TRACSMail - iMAX. This will enable faster submission confirmations, as well as the ability to view TRACS data on your project. Performance Based Contract Administrators (PBCAs) and Traditional Contract Administrators (TCAs) must be ready to accept both TRACS 202B and 202C Monthly Activity Transmissions (MAT) through TRACSMAIL and iMAX commencing October 13, 2008. PBCAs, TCAs and TRACS will discontinue accepting TRACS 202B and TRACSMAIL after January 31, 2009. The update will include changes to HUD-50059, HUD-50059-A, HUD-52670-A Part 1, Part 3, Part 4 and Part 5. Please make sure your software provider is prepared for the upcoming HUD TRACS 202c upgrade, to ensure proper payment of project vouchers. For more information about the planned pgrades, visit HUD’s web site at: http://www.hud.gov/offices/hsg/mfh/trx/trxmeet.cfm and http://www.hud.gov/offices/hsg/mfh/trx/trxdocs.cfm Security Enhancements to TRACS QueriesOn June 27, 2008, in an effort to comply with the Office of Inspector General in protecting the privacy of each individual, TRACS will implement an enhanced version of Tenant and Voucher queries. Social security number (SSN), taxpayer identification number (TIN), and date of birth (DOB), currently displayed in full format on both the web query page and the download file, will now be partially blocked from view through use of the display format below: SSN – XXXXXNNNN TIN - XXXXXNNNN DOB – XX/XX/NNNN Queries and associated downloads affected by the enhancement include: § Assistance Payment Query § Certification Query § Certification with Discrepancies Query § Late Recertification Query § Move-In/Move-Out Query § Multiple Occupancy Query § Project Evaluation Query § Tenant Unit Address Query § Verification Query § Voucher Detail/ Summary Reports Questions concerning the enhancement may be directed to the TRACS Helpdesk at 1-800-767-7588. For CPAs, Financial Assessment Subsystem (FASS) Submitters, and Owners and Agents Required to Submit Financial Statements:Please see this new tip from REAC (http://www.hud.gov/offices/reac/products/mf_news.cfm) for entering detailed project information. FASS accounts have disappeared after the user adds supporting detail. To avoid this data loss, add and save details one at a time. Information About Service Coordinator Grant ExtensionsHousing Notice 08-02 provides guidance on the process for extending Service Coordinator and Congregate Housing Service Program grants whose funds will be expended and whose grant term will end on or before December 31, 2008 New APPS Industry User GuideThe Active Partners Performance System (APPS) was developed to automate the submission and review of the HUD Previous Participation Certification Process (Form 2530). On April 24, 2008, HUD posted an updated user guide to provide the basic steps to perform necessary functions within APPS. http://www.hud.gov/offices/hsg/mfh/apps/appsindustryug.cfm HUD Form 2530 provides record of a participants previous management performance as it relates to HUD contracts. An approved Previous Participation Certification is a prerequisite for approval of various applications to do business with HUD. A New Funding Opportunity from HUDOn Friday, April 25, 2008, the Notice of Funding Availability (NOFA) for the Demonstration Grant Program for Intergenerational Families in the amount of $3.96 million was published in the Federal Register volume 73, number 81. Applications are due July 2, 2008. Information can be obtained on the federal grant source website http://www.grants.gov. It is crucial for applicants to register early to ensure that they have an opportunity to compete for these funds. Eligible Applicants: This opportunity is open to all private nonprofit owners of Section 202 Supportive Housing for the Elderly projects. Questions: For more information, please see the grants page of the HUD website www.hud.gov . For further questions on the demonstration program, please contact Claire Trivedi (202) 402-6634. New RBD Class Offering - HUD TodayTraining for TRACS 202C, EIV and the Latest HUD NewsIn response to your requests for a one-day combination class covering the TRACS 202C Update, EIV and the latest announcements from HUD, RBD is offering a new class called HUD Today. In 2008, HUD will be releasing an update to significantly enhance the TRACS submission process. The update will drive changes to your site operations. In this new class, we will discuss the planned enhancements including: § Replace TRACSMail with iMAX § Require Secure Systems access for TRACS submissions § Add new fields to the 50059 to comply with Handbook changes § Edit and Enhance HUD form 50059 § Add HUD Form 50059-A for partial certification submissions (MO, UT, etc.) § Modify the 52670 Voucher to enhance usability § Incorporate use of mid-month interim certifications to eliminate risk of dual subsidy In addition, we will be discussing The Enterprise Income Verification System (EIV). EIV has been introduced as a new verification and discrepancy reporting tool. Find out how to develop policy to access and use EIV to: § Verify SSA/SSI Income § Verify Employment and Unemployment Income § Uncover Identity Discrepancies § Address Income Discrepancies § Identify applicants who are currently receiving assistance to help avoid dual assistance § Expose potential identity fraud Last but not least, we will provide up-to-date information on as many HUD compliance issues as possible. Learn about: § Clarifications about: o HUD Handbook 4350.3 Revision 1 Change 2 o New Forms § New Leases § New 9887 § New 50059 o Required Changes § Unit Transfers § Resident Selection Plans § Rejection Letters § Student Forms § Medical Expenses § Etc. § Preparing the site for the MOR § Organizing and auditing files We will provide you with samples to help with major processes. Sign Up For the RHIIP ListServRBD encourage our customers to sign-up for the RHIIP Listserv, so you too can receive current RHIIP related information from HUD http://www.hud.gov/subscribe/mailinglist.cfm. Then click on the Multi-family Housing RHIIP (Rental Housing Integrity Improvement Project) Tips. You can view the RHIIP Tips Archives, under "Listserv-Multifamily RHIIP Tips" at http://www.hud.gov/offices/hsg/mfh/rhiip/mfhrhiip.cfm Using this ListServ provides you with a great response during the Management and Occupancy Review when your reviewer asks what you do to keep up with compliance changes. Take 2 minutes and sign up today. RBD does not act as a legal advisor nor as a regulatory governing agency. The recipient should understand that any materials or comments contained herein are not designed for, nor should be relied upon as a source of legal guidance or as a final authority with respect to any particular circumstance. Ross Business Development, Inc. makes no warranty of merchantability or fitness for a particular purpose or any other warranty of any type. Owners and management should seek competent legal advice in developing and carrying out policies and procedures. While we have been diligent in our efforts to provide comprehensive and accurate regulatory information, Ross Business Development, Inc. shall not be responsible for errors or inaccuracies.
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