Alabama ~ Mississippi ~ Connecticut ~ Virginia

Navigate Affordable Housing Partners Preparing for an MOR Compliments of Navigate Affordable Housing Partners Prepared By: Vickie Bell

Before During After

They’re Back ! ! ! A modified Performance-Based Annual Contributions Contract (ACC) was extended through December 2017 and includes the restoration of the Management & Occupancy Reviews (MORs) for all assigned Section 8 contracts in forty-two states. HUD (or representatives assigned by HUD) continue to have the authority to conduct Management & Occupancy Reviews.

MOR Purpose The purpose of the MOR is to verify compliance of the property with the terms of the Housing Assistance Payments (HAP) Contract, Regulatory Agreement, Management Agreement, and Management Plan. MORs are conducted on an annual basis. Contract Administrators (CAs) are responsible for conducting management reviews relating to HAP contract compliance only.

References HUD Handbook 4350.3 Rev. 1, Change 4 HUD Notices Multifamily RHIIP Listserv HUD Handbook 4350.1 HUD Handbook 4381.5 24 CFR (Code of Federal Registry) Fair Housing Laws HAP and Regulatory Agreement Final Multifamily Mailbox Q & A’s (August 2007)

MOR Monitoring Purpose Identify deficiencies Eliminate fraud and waste Frequency Identify deficiencies Eliminate fraud and waste Eliminate mismanagement Support for the Departmental Enforcement Center Annually for compliance Rescheduling a Review Postponing a Review Length of the Review

MOR Components & Steps 9834 Questionnaire File Review Desk Review On-site Review with Addendums Summary Report Owner’s Response (Optional) FHEO Monitoring 9834 Questionnaire File Review Applications Move-outs Physical Inspection(s) REAC Follow-up Vacant Units Resident Interviews Exit Interview

Before the MOR

Scheduling CA will contact the O/A to schedule a review date. Execute a written scheduling letter at least two weeks in advance. Request “Desk Review” items from O/A to be submitted prior to the onsite review. Notify O/A of documents that must be available the day of the review as indicated on Addendum C of form HUD-9834. Forward Part A of Addendum B for completion by the O/A.

Desk Review Items The Desk Review is designed to provide a well-rounded view of the project and identify potential problems that must be targeted during the on-site review. Expedite time on property – Reviewing O/As documents ahead of time will help in providing quality technical assistance to the O/A and maximize the use of limited time during the on-site review. Complete the Desk Review section of the HUD-9834 form.(some questions only refer to the HUD staff) See Attachment-A

Preparing Property and Team Meet with Site Staff to discuss what needs to be done to prepare. Prepare/send notices to residents of MOR date. First impressions are important. Make sure your property has good curb appeal. Prepare your property & common areas for the On-Site Review. All required postings should be available and posted. The property sign should be visible displaying the Fair Housing logo.

Preparing Property and Team Conduct a self-audit of your files – confirm that all required documentation has signatures & dates. Properly maintain resident files & move-out files. Properly maintain waiting list & rejected applications. Confirm that all files are on-site and available for review. Have all of the documents requested on the Addendum C available for review.

Preparing Property and Team Be sure operating procedures are in accordance with your company’s policies and procedures. Review the latest REAC inspection and confirm that items have been mitigated. Confirm that a list of all Service Coordinator programs and services is available. (if applicable) Have criminal activity reports/criminal prevention tasks available. (if applicable) Properly maintain the EIV Master File. It’s important to keep in mind that there is no maximum number of files to be sampled.

Walk The Property

During the MOR

On-Site Review Completing this section requires the reviewer to conduct an interview approach with the O/A using the HUD-9834 Form Part II “On-Site Review” (Categories A thru G). The on-site review also includes Addendums that must be completed or retrieved: Addendum A – Tenant File Review Worksheet Addendum B – Checklist for On-Site Monitoring and Section 504 Reviews Addendum C – Documents to be made available by the O/A

Categories and Percentage Ranking A Categories and Percentage Ranking A. General Appearance and Security 10% B. Follow-up & Monitoring of Project Inspections & Observations 10% C. Maintenance & Standard Operating Procedures 10% D. Financial Mgt./Procurement 25% E. Leasing and Occupancy 25% F. Tenant/Mgt. Relations 10% G. General Management Practices 10%

Communicating the Monitoring Results and Follow-up Written Summary of Reports and Findings Condition – Describes the problem Criteria – Cites the regulatory/statutory requirement Cause – Explains why the condition occurred Effect – Describes what happened as a result of the condition Corrective Action – Addresses the finding, what is required to correct the finding and the response timeframe

Performance Indicators Performance indicators are ratings assigned to each category of the MOR to determine O/A’s compliance with HUD requirements: Superior Above Average Satisfactory Below Average Unsatisfactory

Superior Ratings Description Assigned if O/A’s performance consistently exceeds statutory, regulatory and handbook requirements. Policies & procedures are highly successful in carrying out HUD’s objectives The property is in an exceptional physical condition HUD Handbook 4350.1, REV-1, CHG-2 Paragraph 6-11B

Above Average Description Assigned if O/A’s performance occasionally exceeds statutory, regulatory and handbook requirements. Policies & procedures are successful in carrying out HUD’s objectives Property is in good physical condition with minor deficiencies HUD Handbook 4350.1, REV-1, CHG-2 Paragraph 6-11B

Satisfactory Description Assigned if O/A’s performance meets statutory, regulatory and handbook requirements. Policies & procedures are not always adequate to prevent errors Property has some EH&S and major deficiencies, but many have been corrected by O/A HUD Handbook 4350.1, REV-1, CHG-2 Paragraph 6-11B

Below Average Description Assigned if O/A’s performance rarely meets statutory, regulatory and handbook requirements. Policies & procedures are ineffective or inappropriate, do not meet HUD requirements, resulting in frequent failure to comply Property has substantial number of EH&S and major deficiencies observed & very few corrected HUD Handbook 4350.1, REV-1, CHG-2 Paragraph 6-11B

Unsatisfactory Description Assigned if O/A’s performance does not meet statutory, regulatory and handbook requirements. Policies & procedures are ineffective or lacking, resulting in frequent and often failures to comply Property has many EH&S and major deficiencies observed & none have been corrected HUD Handbook 4350.1, REV-1, CHG-2 Paragraph 6-11B

Resident Interviews Talk with residents about how they like living at the property, services provided and if there are any issues that the Contract Administrator or HUD need to be aware of. HUD Handbook 4381.5 Rev-2 covers regulations that establish several basic requirements for resident involvement by and with management.

Exit Interview Opportunity to discuss any Review findings, make comments or suggestions to O/A Opportunity for O/A to clarify any misunderstood information Opportunity for the O/A to cure or resolve any findings (with the exception of calculation errors) before the completion of the MOR (Note: This may not be the case with all Contract Administrators).

After the MOR

MOR Report To The Owner/Agent Within thirty days from the date of the MOR review the O/A should receive a MOR Summary Report with an overall rating. The report will indicate if a category was acceptable or if a corrective action is needed. O/A must mitigate any corrective actions.

O/A MOR Response Within thirty days from the date of the MOR Summary Report the O/A should respond to the CA in writing, by addressing mitigation of any and all findings listed in the report.

Which New HUD Updates Will Affect Your MOR?

HUD form 92006 (exp.2/28/19) – The CA will confirm that new applications/move-ins dated after 6/1/2016 were completed on the new form. Notice H2015-10 - O/A’s should review their P&Ps, TSPs, House Rules, and practices on criminal records for any unjustified discriminatory actions that will affect access to housing (burden of proof). Criminal arrest records vs. convictions with two exceptions: 1) sex offenders 2) drug manufacturing or distribution). There are 3 questions about convictions O/As should be aware of and consider.

Notice PIH 2016-05(HA) – New guidance on streamlining final rule rent regulations (only 4 apply to MF Housing). Statutory Changes into Regulation Changing the definition of an extremely low-income family Changing the definition of tuition used when calculating income from financial assistance (HUD Notice H2015-12) Changes in Regulation Policy Now permit an O/A to accept applicant households which include any applicant family member who is under the age of 6 & does not yet have a SSN Now permit an O/A to choose to use a streamlined income determination for any family member with a fixed source of income.

Notice H2014-16 Waiting List Administration – Although not mandatory, should the O/A choose to implement the options in this notice the CA will confirm compliance with HUD guidelines. HUD Form 91067 (exp. 6/30/2017) – The CA will confirm that new move-ins dated after 6/1/2016 were completed on the new form.

Just in Hot off the Press HUD 9834 Form (exp. 4/30/2018) – Minor changes to typos and new expiration date.

Discussion & Questions