On March 17, 2016, HUD published a notice in the Federal Register to announce that  as part of the process to renew the use of the form documents used under both the 1st and 2nd Component of its Rental Assistance Demonstration (RAD) Program, HUD is soliciting public comment on the revised,  and in some cases, newly created, documents used by program participants, including the HAP contracts, Use Agreement, RAD Conversion Commitment, and the Financing Plan submission portal.

RAD was created in order to give public housing authorities (PHAs) a tool to preserve and improve public housing properties and address the $26 billion dollar nationwide backlog of deferred maintenance. RAD also gives owners of three HUD “legacy” programs (Rent Supplement, Rental Assistance Payment, and Section 8 Moderate Rehabilitation) the opportunity to enter into long-term contracts that facilitate the financing of improvements.  Participation in RAD is voluntary. Participating PHAs and Multifamily Owners are required to submit documentation for the purpose of processing and completing the conversion. Through these documents, HUD evaluates whether the PHA or owner has met all of the requirements necessary to complete conversion as outlined in PIH Notice 2012-32 Rev 2 (June 15, 2015) Rental Assistance Demonstration—Final Implementation Notice (RAD Notice).

The public comment period is open for 60 days at which point HUD will review comments and incorporate changes as appropriate. HUD will then re-issue the documents for a 30-day public comment period.  Comments are due Monday, May 16th.

In particular, HUD proposes to make the following changes:

1. Inclusion of Fair Housing, Civil Rights and Relocation Requirements in RAD Documents:

Consistent with HUD’s RAD Notice, HUD expects that RAD transactions will comply with fair housing, civil rights and relocation requirements and changes to the proposed documents are meant to assist in compliance therewith.   The changes under consideration include the following:

(i) Modifications to the various Housing Assistance Payments contracts to ensure appropriate enumeration of existing fair housing and civil rights requirements and clarification of such requirements;

(ii) Revision and expansion of the FHEO Accessibility and Relocation Plan Checklist to more comprehensively address all federal fair housing and civil rights reviews identified in the RAD Notice (including those derived from the Fair Housing Act, Title VI of the Civil Rights Act of 1964, HUD’s Equal Access Rule, and other authorities) and resident relocation compliance issues;

(iii) Revisions to the RAD Conversion Commitment to add certifications and representations to ensure compliance with fair housing and civil rights requirements until and after the RAD closing.

2. Clarification of Davis-Bacon Standards – HUD is reviewing the Davis-Bacon Standards in the RCC and HAP Contracts to determine whether they are sufficiently clear or if further clarification is needed.

Form documents on which comment is requested include:

• First Component Public Housing FHEO Accessibility and Relocation Checklist
• First Component Public Housing Financing Plan Template
• First Component Public Housing PBRA HAP Part I
• First Component Public Housing PBRA HAP Part II
• First Component Public Housing PBV Rider
• First Component Public Housing RAD Conversion Commitment
• First Component Use Agreement
• Second Component Mod Rehab PBRA RAD HAP Part I
• Second Component Mod Rehab PBRA RAD HAP Part II
• Second Component Rent Supp, RAP & Mod Rehab PBV Rider for Existing Housing PBV Contract 
• Second Component RentSupp RAP PBRA HAP Part I
• Second Component RentSupp RAP PBRA HAP Part II

Ballard Spahr will be undertaking a review of the proposed forms and anticipates submitting comments with respect thereto.  We welcome thoughts of our clients and friends who may be interested in compiling joint comments.

Comments can be submitted electronically or to the following address:

Regulations Division
Office of General Counsel
U.S. Department of Housing and Urban Development
451 7th Street SW., Room 10276
Washington, DC 20410–0500