This email is for our customers managing 202 and 811 PRAC properties.
On March 12, HUD’s Office of Multifamily Housing released a memorandum (click here to view) regarding budget-based rent increases for PRAC Properties.
In July of 2019, the Office of Multifamily Housing Programs temporarily suspended approvals for this type of increase due to escalating subsidy requirements that strained the program’s annual budget. With appropriations for the full fiscal year now available, HUD has a clearer picture of the resources available for rent increases in 2020.
HUD has also standardized field office procedures for reviewing PRAC Capital Needs Assessments (CNAs) and determining how those capital needs should be reflected within the annual PRAC project operating rents. Updated process prioritizes core operating costs for all renewing PRAC contracts, while recognizing that, especially as our PRAC assets age, project budgets must address future repair and replacement of major building systems components.
HUD also briefly discusses the 202 PRAC conversion to RAD option. In this notice, HUD also announced that they plan to expand the RAD program to include conversions from 811 PRAC to RAD.
