New Inspector Notice Clarifies Treatment of Substandard Repair Made to Disguise Deficiencies

On July 10, 2016, HUD released Inspector Notice No. 2016-03, which clarifies standards to all HUD Uniform Physical Condition Standards (UPCS) inspectors regarding repairs made to sites. The changes implemented in this notice are effective on Aug. 1, 2016. According to the Public and Indian Housing Real Estate Assessment Center Inspector Administration, quality assurance inspectors had noticed a growing trend of non-industry standard inferior repairs in preparation for a REAC inspection at some sites for the past several months. The inspector administration believes that such a practice eventually leads to diminished living conditions because of repairs that don’t meet the “industry standard” for being a reasonable and/or an appropriate repair.

The new requirement says that repairs that are deemed to be outside of “industry standard” and intended to disguise a UPCS deficiency will be cited as the closest relative UPCS deficiency. For example, if a hole in a wall is not repaired correctly, it will be cited as a “hole,” and the severity will depend on the size of the inappropriate repair. The same principle applies to all areas of a property.

Standard

All repairs to address UPCS deficiencies in preparation for a REAC inspection are to be made in a good and workmanlike manner with materials that are suitable for the purpose and free from defects. The phrase “good and workmanlike manner” means:

• Ensuring that the component, as repaired, performs its intended function/purpose; and
• Finishing the repair in a manner reasonably compatible with design and quality of the original and adjoining decorative materials.

Clarifying Guidance

Each repair is made in accordance with the industry standard for the particular inspectable item. For example, when a hole in the drywall is repaired using the same or equivalent materials, the materials have the same texture, and there is an indistinguishable difference from the original esthetics/appearance, the specific drywall repair has been made in accordance with industry standard. However, a deficiency will be recorded for each substandard repair made to avoid or disguise an observed deficiency based on the size of the area affected and/or the item inspected.

For example, inspectors will examine a piece of plywood covering a hole in the drywall to determine, among other things, if it is larger than 8 ½” x 11” (a sheet of paper). This means that a 6” x 6” piece of plywood that is not of like material to cover a hole will be recorded as a Level 1 deficiency; and a 2’ x 2’ piece of plywood will be recorded as a Level 2 deficiency. However, a piece of plywood, regardless of size, that covers up a hole that completely penetrates the wall will be recorded as a Level 3 deficiency.

The following is a partial list of typical inspectable items that the inspector administration has found to be often incorrectly repaired:

• Cracks in brick wall. Tuck-pointed using mortar is the correct means of repair; caulking is not appropriate.
• Drywall repair. Sheetrock with mud and/or tape is the correct means of repair. Simply covering the hole or damaged drywall with plywood/laminate is not correct.
• Wooden door repair. Wood or wood veneer is the correct material for repair. Sheetrock mud or plywood is not correct.
• Downspouts. Same materials, shape, and design are correct. Plastic or PVC piping is not correct.
• Erosion. Correcting the root cause of the erosion is the correct means of repair—for example, correct or repair the drainage or add fill-soil. Simply hiding or covering the erosion with mulch or straw is not correct.
• Electrical panels. Installing a correct panel cover or using manufactured blanks is the correct means of repair. Using caulking or expandable spray foam to fill gaps is not correct.
• Refrigerator gasket. Replacing the gasket is the correct means of repair. Using white electrical tape, fingernail polish, White-Out, etc., is not correct.
• Broken window lock. Repairing or replacing the original lock is the correct means of repair. Placing a stick in the window as the primary means of securing a window or sliding door is not correct.