HUD Updates Guidance on Renewing PBC HAP Contracts

HUD has issued Notice PIH 2010—8 (HA), which amends the instructions for renewing or extending Project-Based Certificate (PBC) Housing Assistance Payments (HAP) contracts as Project-Based Voucher (PBV) HAP contracts under certain conditions, which is permitted by Section 6904 of the 2007 Iraq Accountability Appropriations Act.

Specifically, public housing authorities (PHAs) can renew these contracts when the initial PBV HAP contract is for a term of up to 15 years and the rents for the renewed contract are calculated according to section 8(o)(13)(H) of the 1937 Act and HUD regulations. Prior to the enactment of the Housing and Economic Recovery Act of 2008, the maximum term of a PBV HAP contract was 10 years.

Currently, PBC HAP contracts are renewed in accordance with the terms of the contract. Depending on the availability of funds, PHAs may renew PBC HAP contracts for up to five years, to an aggregate total—including the original term and all extensions—of 15 years (except when an extension is provided to meet the one-year notification requirement. The amendment also allows owners to renew their PBC contracts as PBV contracts without reapplying for PBV assistance under the program.

In addition, PHAs, at their discretion and the request of an owner, can renew a PBC HAP contract as a PBV HAP contract, but must make the determination within one year before the PBC HAP contract expires.