HUD Recently released Housing Notice H-2014-14 to provide guidance about policies and procedures for transferring all or a portion of any remaining budget authority of a project-based Section 8 Housing Assistance Payments (HAP) Contract to one or more contracts under Section 8(bb)(1) of the United States Housing Act of 1937. Section 8(bb) provides the Department with a tool for preserving Section 8 budget authority, whereby, if a project-based Section 8 contract is terminated or expires and is not renewed, HUD is required to transfer any remaining budget authority to either a new or an existing Section 8 HAP contract.
The requirements in Notice H-2014-14 applies only when the contract administrator and the Owner of a project which is subject to an existing project-based Section 8 HAP Contract have mutually agreed (i) to terminate the Contract so that all of the remaining budget authority can be transferred to another multifamily housing project; or (ii) to subdivide the Contract and then terminate one or more of the resulting Contracts so that the budget authority remaining on the contract(s) that was terminated may be transferred to the Section 8 HAP contract on one or more other multifamily housing projects. The other project(s) may be owned by the same Owner as the project from which the budget authority is being transferred or by a different Owner.
The Notice presents several scenarios for how to handle contract transfers for both project types.
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