On July 2, 2013 HUD issued its “Notice of Senior Preservation Rental Assistance Contracts Award Process” (Notice), which specifies the process by which HUD will award Senior Preservation Assistance Contracts (SPRACs). The Notice also starts the application process, and solicits applications for a period of 60 days. Deadline: September 3, 2013. Click here to download the notice.
About SPRACs
The Section 202 Supportive Housing for the Elderly Act of 2010, signed into law in January 2011, authorizes HUD to provide SPRACs with 20-year terms to prevent displacement of elderly residents of certain projects assisted under HUD’s Section 202 Supportive Housing for the Elderly program in the case of refinancing or recapitalization and to further preserve and maintain affordability of Section 202 Direct Loan projects. The purpose of SPRACs is to prevent displacement of income-eligible elderly residents of Section 202 Direct Loan properties with original interest rates of 6% or less, when the property is refinanced and the Owner does not anticipate debt service savings from the refinance. SPRAC is an important preservation tool for affordable multifamily properties.
In FY-2012, $16 million was made available for SPRAC funding. This notice advises of HUD’s intent to award SPRACs through the proposed application process described in the notice. The Advance Notice also opens a 60-day public comment period. HUD is soliciting comments on the proposed process for awarding SPRACs and the associated criteria for establishing eligibility to apply for a SPRAC. The program will be administered by the Office of Affordable Housing Preservation (OAHP). OAHP has provided a list of properties that are potentially eligible for SPRACs in Excel and PDF formats. Click here to learn more.