HUD Taking Another Look at Section 8 Renewal Guide

In order to have the necessary time to examine proposed changes to Section 8 regulations and revising parts of the Renewal Guide, HUD is currently waiving certain parts of the Section 8 regulations and the Renewal Guide on a case-by-case basis.

According to a February 22 memo issued by Carole Galante, Deputy Assistant Secretary for Multifamily Housing Programs, HUD will review regulatory waiver requests for a nonprofit owner with a new regulation Section 8 contract for new construction or substantial rehabilitation that wishes to receive: (a) a distribution limited to 6 percent on initial equity investment for projects for elderly families; (b) a distribution limited to 10 percent on initial equity investments for projects for non-elderly families; or (c) unlimited distributions for preserving long-term affordability under Chapter 15, Nonprofit Section 8 Preservation Effort.

The Department will also review Section 8 Renewal Guide waiver requests for certain sections of Chapter 3, including mark-up-to-market, and the Chapter 15 cap on market rents. The waiver will allow rents to go up to the market rent level, as determined by the rent comparability study.

Other waivers to be reviewed on a case-by-case basis include project eligibility as it pertains to Real Estate Assessment Center (REAC) scores requiring eligible projects to have a REAC score greater than 30.

HUD will issue waivers in relation to specific preservation transactions, either potential or in progress, but will not issue waivers for any transaction that has already closed. Waiver requests with supporting documentation will need to be reviewed and approved by the Hub director and faxed to Willie Spearmon, Director, Office of Housing Assistance and Grant Administration, (202) 708-3104.