HUD Issues Guidance on How to Enforce a Zero REAC Score for Refusal to Schedule an Inspection Based on 14-Day REAC Guidance

On May 1, Deputy Assistant Secretary in HUD’s Office of Multifamily Housing Program Lamar Seats sent a memo to HUD field offices titled “What to Do When a Project Receives a Zero as a Result of an Owner Refusing to Allow HUD to Inspect.” According to the memo, should properties not schedule an inspection in the original 14-day period and also fail to schedule an inspection within another 7 days, the Account Executive (AE) or Resolutions Specialist (RS) should:

  • Place a Tier 2 Flag on all controlling participants in HUD’s Active Partners Participation System (APPS) under Miscellaneous Violation of Business Agreements.
  • Issue a Notice of Default (NOD) of Contractual Obligation within 15 days of receiving the email notification.
  • Ask the Regional Inspection Coordinator to request a new inspection on a date soon after the expiration of the 60-day cure period referenced in the NOD. The Physical Inspection Coordinator will make the request by placing the project on the Re-inspection Request List on SharePoint. The Physical Inspection Coordinator should make a note in the comment section that the project received a score of zero because the owner did not meet its contractual obligation to allow HUD to inspect within the 14-day notification period.
  • The AE or RS must also update the Physical Inspection/EH&S Event Tracking Screen to note the date the NOD was issued to the owner and the date the new inspection was ordered. The date the new inspection is ordered should be the date the AEIRS asks the Physical Inspection Coordinator to make the request on SharePoint.

Contact Brandt Witte at (202) 402-2614 or at Brandt.T.Witte@hud.gov with questions.