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Catalog of Federal Domestic Assistance

Program Descriptions

CATALOG OF FEDERAL DOMESTIC ASSISTANCE

14.197: Multifamily Assisted Housing Reform and Affordability Act

Objectives: To retain critical affordable housing resources represented by the supply of FHA-insured Section 8 assisted housing and maintain it in good physical and financial condition while, at the same time, reducing the cost of the ongoing Federal subsidy. In carrying out the Program, HUD works with willing participating administrative entities (PAEs), owners and lenders to reduce Section 8 rents and operating expenses to true market levels and also provide for the project's capital improvement needs.

PROGRAM AND AWARD FINANCIAL AND INFORMATION CONTACTS

ELIGIBILITY REQUIREMENTS FINANCIAL AND ADMINISTRATIVE INFO.

APPLICATION AND AWARD PROCESS INFORMATION CONTACTS

RELATED PROGRAMS ASSISTANCE CONSIDERATIONS

PROGRAM ACCOMPLISHMENTS POST ASSISTANCE REQUIREMENTS

14.197 ELIGIBILITY REQUIREMENTS:

Applicant Eligibility: The project must be subject to a FHA-insured mortgage and supported by project-based Section 8 HAP contracts with rent levels which, in the aggregate, exceed Comparable Market Rents.

Beneficiary Eligibility: The project owner and individuals/families who are project tenants.

Credentials/Documentation: Owner will submit a request to enter Mark-to-Market at least 90 days prior to the expiration of the HAP contract and certify the property is eligible to participate. The owner must not have been suspended or disbarred.

14.197 APPLICATION AND AWARD PROCESS:

Preapplication Coordination: Owner must submit a letter of intent to the Multifamily Director of the local HUD Field Office. This program is excluded from coverage under E.O. 12372.

Application Procedure: Owner must submit a letter of intent to the Multifamily Director of the local HUD Field Office at least 90 days prior to HAP expiration.

Award Procedure: Not applicable.

Deadlines: Applications are due 90 days prior to expiration of Section 8 contract.

Range of Approval/Disapproval Time: Eligibility to participate in the program is determined within 30 business days of OMHAR's receipt of submission. Restructuring and refinancing process should take no longer than 12 months.

Appeals: If the owner is not programmatically eligible there is not an appeal process as this is determined by legislative authority. Appeal of "Restructuring Commitment" or rejection of a Restructuring Plan may be submitted in writing (with a copy to the Participating Public Entity) to the Director of Office of Multifamily Housing Assistance Restructuring, within 10 calendar days of the issuance date of Restructuring Commitment.

Renewals: Section 8 contracts will only be issued on an annual basis.

Criteria for Selecting Proposals: Not applicable.

Examples of Funded Projects: Not applicable.

Range and Average of Financial Assistance: Partial Payment of Claims may be made up to the amount of the unpaid principle balance of the FHA insured mortgage. Section 8 contracts will be provided at comparable market rents.

14.197 RELATED PROGRAMS:

14.135 Mortgage Insurance: Rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate;
14.138 Mortgage Insurance: Rental Housing for the Elderly;
14.155 Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects;
14.195 Section 8 Housing Assistance Payments Program: Special Allocations.

14.197 PROGRAM ACCOMPLISHMENTS:

Beginning in fiscal year 1999, the Office of Multifamily Housing Assistance Restructuring (OMHAR) contracted with Participating Administrative Entities (PAEs) (legislative preference was given to State and local housing finance agencies) to restructure Mark-to-Market eligible properties. To date, OMHAR has executed agreements with 42 public and and six nonpublic entities. In fiscal year 2000, OMHAR estimates that rents will be reduced under the Mark-to-Market Program on about 900 projects (88,000 units) and in fiscal year 2001 about 1,400 projects (135,000 units). These estimates are based on an OMHAR projection of anticipated workload, which is, in part, based on an estimate of market rents for contracts expiring in the future. These projections may be affected by owner decisions, real estate market trends, accuracy of the REMS data base, and future legislative changes relative to M2M eligible properties.

14.197 FINANCIAL AND ADMINISTRATIVE INFO:

Federal Agency: OFFICE OF MULTIFAMILY HOUSING ASSISTANCE RESTRUCTURING (OMHAR), DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Type of Assistance: Direct Payments for Specified Use.

Obligations: FY 99 $24,000,000; FY 00 est $247,000,000; and FY 01 est $2,028,000,000.

Budget Account Number: 86-4072-0-3-371.

Authorization: Departments of Veterans Affairs, Housing and Urban Development, and Independent Agencies Appropriations Act of 1998, Public Law 105-65; HUD FY 1998 Appropriations Act.

Regulations, Guidelines, and Literature: Fiscal Year 1998 Multifamily Housing Mortgage and Housing Assistance Restructuring Program and Renewal of Expiring Section 8 Project-Base Assistance Contracts Interim Regulations are published in the Federal Register, Volume 63, No. 176, dated Friday, September 11, 1998.

14.197 INFO CONTACTS:

Regional or Local Office: The Office of Multifamily Housing Restructuring has four Regional Office locations: Chicago Regional Office: Beverly Bishop; Regional Director, Office of Multifamily Housing Assistance Restructuring; 200 West Adams, Suite 2610; Chicago, IL 60606. Phone: (312) 886-1400 or 4133. District of Columbia Regional Office: John Prusch, Regional Director; Office of Multifamily Housing Assistance Restructuring; The Portals Bldg., Suite 4400; 1280 Maryland Ave., SW; Washington, DC 20024. Phone: (202) 708-0001. New York Regional Office: Patrick Eckman, Acting Regional Director; Office of Multifamily Housing Assistance Restructuring; 6 World Trade Center; New York, NY 10048. Phone: (212) 822-8900. San Francisco Regional Office: Mary Anne Cottmeyer; Regional Director; Office of Multifamily Housing Assistance Restructuring; Phillip Burton Federal Building; 450 Golden Gate Ave., Room 10-4580; San Francisco, CA. Phone: (415) 436-8550.

Headquarters Office: David McDonough, Office of Multifamily Housing Assistance Restructuring, Suite 4000, 1280 Maryland Ave., SW, Washington, DC 20024. Phone: (202) 708-0001.

(See Appendix IV for more contact info.)

14.197 ASSISTANCE CONSIDERATIONS:

Formula and Matching Requirements: Not applicable.

Length and Time Phasing of Assistance: Section 8 contracts are issued on an annual basis as long as the property remains eligible. Owners of projects that undergo a mortgage restructuring shall commit to maintain project affordability for 30 years.

Uses and Use Restrictions: Participating owners who undergo a mortgage restructuring must execute a use agreement committing to maintaining affordable housing for 30 years.

14.197 POST ASSISTANCE REQUIREMENTS:

Reports: As required by Section 8 and future program guidelines.

Audits: Annual audits are required.

Records: As required by Section 8 and future program guidelines.