Owners who participate in the Project Based Section 8 program have entered into Housing Assistance Payment (HAP) contracts with HUD and the PBCA.

Through the HAP contract, owners agree to provide housing assistance to eligible households and receive payment for their services after submission of their monthly HAP voucher. Depending upon the owner’s request, HAP contracts may vary in duration of one year to 20 years.

Upon expiration of the HAP contract, owners must submit timely contract renewal documentation to OHFA so that the HAP voucher payments can continue. The contract renewal documentation must be submitted in accordance with the HUD Section 8 Renewal Policy guidebook.

Owners may select from the following six contract renewal options:

• Option One: Mark-Up-To-Market
• Option Two: Renewal with existing rents adjusted by OCAF or on the basis of a budget when rents under the expiring contract are at or below market
• Option Three: Referral to OAHP for processing because the contract has rents greater than market and is subject to an FHA-insured or HUD-held mortgage
• Option Four: Renewal of contracts for “exception” projects, which are exempt from debt-restructuring pursuant to 514(h) of MAHRA or are not an “eligible multifamily housing project” as defined in section 512(2) of MAHRA.
• Option Five: Renewal of contracts for Portfolio Reengineering Demonstration or Preservation projects
• Option Six: Opt-out of the Section 8 contract

For detailed guidance and submission requirements, please refer to the HUD Section 8 Renewal Policy guidebook.

The HUD Enterprise Income Verification (EIV) System provides integrated income data from one source. Via the Internet, housing partners at various levels are required to use EIV for applicants and tenants to improve income verification and reduce improper HUD housing assistance payments.

EIV provides the following information:

• Monthly employer new hires
• Quarterly wages (including employer information); federal wages are available
• Quarterly unemployment compensation
• Monthly social security (SS) and supplement security income (SSI) benefits

Data in the EIV System is highly sensitive and confidential. HUD requires all users of the EIV System to maintain strict security measures to ensure the integrity of the data. Users must be certified by the EIV Coordinator twice a year.

Property owners/management agents must establish and implement policies and practices to demonstrate compliance with EIV reporting requirements. This includes setting up a Master File used to monitor tenant compliance and incorporate EIV reports for Move-in, Interim, and Annual Certification processes.

Updates and changes to the EIV system are communicated through the Rental Housing Integrity Improvement Project (RHIIP) Listserv.

The HUD Handbook 4350.3, REV-1, Change 4, Occupancy Requirements of Subsidized Multifamily Housing Programs, has been updated to include the EIV requirements. The EIV requirements can be found in Chapter 9 of the handbook.

March 8, 2013, HUD issued an EIV update, Housing Notice 2013-06, Enterprise Income Verification (EIV) System. This Notice supersedes Notices H 2011-21, H 2008-03, H 2009-20, and H 2010-10. The Notice is posted on HUDCLIPS.

Any questions related to EIV use in Project-Based Section 8 Housing should be directed to the Multifamily Help Desk at (888) 767-7588, (202) 401-7984 or [email protected].

HFA is committed to transmitting prompt, accurate payment of Housing Assistance Payment (HAP) Vouchers to each of our owners every month.

In order to receive monthly voucher payments, HUD regulations require owners to submit a HAP Voucher request to OHFA by the 10th day of the month prior to the month for which payment is requested. We require that each property submit an electronic version of the voucher, via the Tenant Rental Assistance Certification System (TRACS), supporting 50059 data, and a signed and dated paper copy of the voucher.

Vouchers submitted after the deadline risk late payment. We are not able to process voucher payments until all required documentation is received and reviewed for accuracy and eligibility. A monthly voucher submission is required even if the owner is requesting no payment for the billing month.

Generally, HAP Vouchers are paid electronically on the first business day following the end of each month. Late owner submission and other extenuating circumstances could cause HAP Voucher Payments to be delayed.

Tenant Rental Assistance Certification System (TRACS)

The Tenant Rental Assistance Certification System (TRACS) is a HUD computer system. The system was developed to help improve financial controls over assisted housing programs by automating manual procedures and incorporating automated controls. TRACS is used for electronic tenant data collection and HAP Voucher processing.

Integrated Multifamily Access Exchange (iMAX)

The Integrated Multifamily Access Exchange (iMAX) is a front-end subsystem to TRACS. It accepts data submitted from the Industry sites to HUD Headquarters in an electronic form and returns messages from HUD Headquarters to sender sites. Limited edits are performed on the data format before passing the pre-validated data to the TRACS system for further validation and processing. Data which fail the iMAX edits create error messages to the sender requesting data correction. The Industry partners are responsible for formatting their automated data to be accepted by the iMAX and TRACS systems.

The MAT User Guide for TRACS 202D contains technical submission instructions for using the most recent TRACS system, which went live August 1, 2014. All owner/agents must convert to TRACS 202D by January 31, 2015. TRACS will only accept transmissions in the 202D format after January 31, 2015.

OHFA highly recommends that all owner/agents either download or print the MAT User Guide for TRACS 202D.

HUD Handbook 4350.3, REV-1, Change 4 Occupancy Requirements of Subsidized Multifamily Housing Programs has been posted to HUDCLIPS. The handbook is updated to include information on use of the Enterprise Income Verification (EIV) system; Violence Against Women Act (VAWA) requirements; Supplemental Information to Application for Federally Assisted Housing; Rent Refinement of Income and Rent Determination Requirements in Public and Assisted Housing Programs; Final Rule, and requirements relating to admission of individuals subject to State lifetime sex offender registration requirements.

2015 Operating Cost Adjustment Factors (OCAFs) were published in the Federal Register on October 2, 2014. These factors are used for adjusting or establishing Section 8 rents under the Multifamily Assisted Housing Reform and Affordability Act of 1997 (MAHRA), as amended, for projects assisted with Section 8 Housing Assistance Payments. The factors are effective February 11, 2015.

Rental Housing Integrity Improvement Project (RHIIP) is HUD’s strategy to reduce errors in the administration of HUD’s rental housing assistance funds. The Multifamily Housing RHIIP Listserv was established to provide the latest RHIIP related news, occupancy tips and other items of information for the stakeholders of the various HUD subsidized multifamily programs. Subscribe to the Listserv.

Operating Cost Adjustment Factor (OCAF)

The Auto Operating Cost Adjustment Factor (OCAF) Rent Adjustment process is initiated by HUD or the Contract Administrator. Not all contracts are eligible for the Auto OCAF.

If the property is eligible for an Auto OCAF rent adjustment, OHFA will send the owner information each year. One hundred and fifty days prior to the property’s renewal anniversary, OHFA will send the owner a letter advising of the property’s new OCAF adjusted rents, a new Exhibit A, and a request for certification of the accuracy of the debt service and non-Section 8 rent potential amounts. To accept the Auto OCAF rent increase, the owner will need to return to OHFA the signed/dated certification and three copies of Form HUD-92458 Rent Schedule within 10 days so that the process can be completed.

If the property is not eligible for the Auto OCAF, the process will be initiated by the Owner each year. One hundred and twenty days prior to the property’s renewal anniversary, the owner must submit the completed OCAF Rent Adjustment request to OHFA. We will process the request under the original OCAF procedures.

OCAF Rent Adjustment Worksheet - HUD-9625 Form

Budget Based

Owners may request Budget Based rent adjustments for properties with HAP contracts that are eligible during the term of the contract or at contract renewal.

Submission to request a rent increase should include all of the materials listed below, plus any additional documents being used to support the request.

The checklist for initial submission is below. Submission to request a rent increase should include the materials listed on the checklist plus any additional documents being used to support the request.

• Cover Letter that summarizes why the rent increase is needed, the date the increase will be effective, a description of  the physical condition of property and any improvements that have been budgeted for, identification of any proposed change in services, equipment, or charges, and the reasons for the change.
• Budget Worksheet HUD Form 92547-A, (Appendix 4 (d))
• Owner explanation of budget items, (Appendix 4(b))
• Copy of Notice to Tenants, (Only if required)
• Owner certification regarding purchasing practices and reasonableness of expenses, (Appendix 4(b))
• A signed request for an increase in the Reserve for Replacement if such an increase is contemplated as part of the rent increase request, (Appendix 6). [Send to the HUD Project Manager]
• Utility Allowance Analysis (if applicable)

Refer to the HUD Handbook 4350.1, REV-1, Multifamily Asset Management and Project Servicing, Chapter 7 for detailed guidance and owner submission requirements.