HUD Issues Guidance on Site Owners’ Responsibilities to Residents

HUD’s Office of Asset Management and Portfolio Oversight (OAMPO) recently issued a memo for multifamily regional directors, satellite office directors, performance-based contract administrators, and multifamily owners and management agents. The memo clarifies owners’ responsibilities to notify residents in advance of physical inspections and to make final inspection documents available for review and comment. The memo also encourages collaborative implementation of new house rules.

In addition, the memo provides guidance on sharing responses to tenant complaints and encourages tenants to report false certifications of completed repairs of exigent health and safety findings.

Notifying Residents of a Physical Inspection

According to the memo, HUD encourages owners to give as much advance notice as possible to residents of a planned inspection. The Code of Federal Regulations at CFR, part 200, subpart P, section 200.857(g) states that an “Owner must notify its residents of any planned physical inspections of their units or the housing development generally.” Residents should be given at least 24-hour notice of a planned inspection unless state and/or local law requires more than a 24-hour notice.

This memo comes after HUD implemented, earlier this year, a reduction in advance notice required to PHAs and private owners of HUD-subsidized sites before their housing is inspected to ensure it’s decent, safe, and healthy. Currently, HUD’s new standard gives PHAs and private owners of HUD-assisted housing 14 calendar days’ notice before an inspection. This was a dramatic reduction from the prior notice, which was frequently extended up to four months.

With Notice PIH-2019(HA) H-2019-04, HUD employees and contract inspectors acting on behalf of HUD will give site owners and their agents 14 calendar days of notice before their inspection. If an owner declines, cancels, or refuses entry for an inspection, a presumptive score of “0” (zero) will be recorded. If the second attempt results in a successful inspection within seven calendar days, the resulting score will be recorded. If the second attempt doesn’t result in a completed inspection within seven days of the initial date due to the fault of the owner, the zero pending score will be registered and the owner is subject to HUD’s remedies for a failing score.

Making Inspection Documents Available for Comment and Review

Owners are obligated to make certain physical inspection documents available for review and comment. Once the 30-day technical review appeal period and the 45-day database adjustment appeal period have expired, the owner must make its physical inspection report and all related documents available to residents during regular business hours and upon reasonable requests for review and copying. Related documents include, but are not limited to, the following:

• Notice of Default (NOD) of Housing Assistance contract or a Notice of Violation (NOV) of Regulatory Agreement. Owners must provide a copy of the NOV or NOD if the owner received one to residents receiving project-based Section 8 assistance by leaving a notice under each door, posting the notice in the mail room, and on each floor, or by other means;
• “Owner’s Certification that the Physical Condition of the Project is in Compliance with HUD contracts and the Physical Condition Standards of 24 CFR Sec. 5.703,” along with the 100 percent survey of the site, as requested in an NOD or NOV; and
• Owner’s Plan of Corrective Action, if one is submitted.

Once the owner’s final physical inspection score is issued, the owner must make any additional information, such as the results of any reinspections, technical review, and database adjustment appeal requests, available for review and copy by residents upon reasonable requests during regular business hours. All documents must remain available for review for 60 days from the date the final score was issued.

The owner must also post a notice to the residents in the owner’s management office and on any bulletin boards in all common areas that advises the residents of the availability of the materials noted above. The notice should include the name, address, and telephone number of the HUD Field Office account executive or resolution specialist.

Implementing New House Rules

House rules are the owner’s written and displayed policies outlining the residents’ responsibilities. House rules establish normal conduct for owners, management agents, and residents at the site and provide the rules for areas of mutual interest such as noise, pest management, security, and trash disposal.

The memo encourages owners and management agents to consult residents before establishing or making significant changes to the house rules. And all residents must receive a copy of the house rules and have opportunities to ask questions to ensure they understand the policies.

House rules aren’t reviewed by HUD asset management staff unless they’re the subject of a tenant complaint or other concern about a property’s management. House rules must be consistent with the HUD model lease, any applicable use agreement, and in accordance with residents’ rights under federal, state, and local law. HUD staff and/or the performance-based contract administrator (PBCA) must work with an owner to resolve any issues that are inconsistent with these requirements.

Responding to Resident Complaints

When an owner or management agent submits a written response to a resident complaint to HUD or the PBCA, a copy of that response should be given to the person who made the complaint, if requested. Since the owner’s response may contain references to a resident’s personal information or circumstances, all applicable HUD privacy procedures must be followed when providing a copy of the response to anyone other than the person who made the original complaint.

If the owner discusses more than one topic in the document, only the portions related to the resident’s complaint should be provided. Normal record management policies apply. If the resident is requesting an older document that falls outside of the normal record retention period and is no longer available, the manager should be promptly notify the resident of the reason why the request for documentation can’t be fulfilled.

Self-Certifying Completed Repairs of Exigent Health & Safety Findings

During an inspection, Real Estate Assessment Center (REAC) inspectors look at specific areas of the site for health and safety hazards. Some health and safety hazards are considered so dangerous that HUD requires you to take steps to correct these hazards immediately and certify within three days that you’ve done so. HUD calls these types of life-threatening hazards “exigent health and safety hazards” because of the urgent need to correct them in view of the risk of physical injury and death that they pose.

REAC requires you to document in writing your repairs of exigent health and safety hazards. This documentation must be attached to your certification. According to the memo, resident advocates have raised concerns about owner self-certification of completed repairs. As a result, owners and management agents are encouraged to submit supporting documentation with their reports identifying and certifying completion repairs, such as:

• Photographs taken before and after repairs;
• Work orders or invoices from the contractor who completed the repairs;
• Letters from relevant tenant organizations satisfied with the repairs.

The HUD staff and PBCAs may request supporting documentation, at their discretion. The memo says that if asset management staff have concerns about an owner’s certification or repairs, they should work with their branch chief to determine and follow the appropriate course of action.