Tenant Assistance Programs - ky Housing

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Microsoft PowerPoint - How to Prepare for an MOR.pptxMelissa J. Corbett
PBCA Asset Manager
Extension 728 Extension 268
Contract Administrators are responsible for
assessing the management and oversight of
housing projects and for ensuring that owners
comply with the requirements of the HAP contract.
Refer to HUD-9834 form for the complete review checklist
Management & Occupancy Review
by June 2020 MOR activity was re-instated.
– FY2019 - KHC conducted 77 MORs
– FY2020 – 96 were conducted (none completed from March 16 to May 30)
– FY2021 – we hope to increase to nearly 170
To determine a schedule KHC works with HUD staff to create a workplan and
gives priority to those properties who have not had a review in a longer period of
time, those that are considered “troubled” and/or having major issues that have
been brought to our attention such as a below 60 REAC.
How can you be prepared or know what to
MOR Notification
• KHC staff will contact you by phone and e-mail to schedule the review.
– Be sure that we have your correct contact information. Report these changes timely!
• KHC will follow up by sending you a formal notification letter noting the date/time that was discussed.
MOR Notification
• BE SURE TO READ the information contained in the letter.
• It will include: • A list of information that must be made available
(Addendum C) on the day of the review.
• A copy of the HUD-9834 form.
• A copy of Addendum B – owners must completed & sign this prior to the review so that this document can be turned in to the KHC reviewer the day of the MOR.
Steps you can take to be prepared
• Inspect the property for trash/debris especially the morning of the MOR.
• Consider closing the office for the day to avoid distractions.
• Prepare a separate workspace for KHC staff to work while auditing files. Be sure it is clean!
• To save time, have documentation already pulled and ready for reviewer(s) - refer to Addendum C which
was attached to the notification letter.
Steps you can take to be prepared
• Check your bulletin board to ensure that all required information is posted:
– Fair Housing Poster
– AFHMP - Has it been reviewed and/or updated in the past 5 years?
– Hours of Operation and Emergency Numbers
– Tenant Selection Plan (TSP) – current version
– KHC Contact Poster
Fair Housing Poster
Section 14 question o and p.
Is the fair housing sign posted
in the rental office? Is the FH
logo included in advertising?
• HHB 4350.3 Chapter 2-5E
• HUD-9834 page 8 of 18, Section 14n. Does the advertising comply with existing AFHMP?
• HHB 4350.3 Chapter 2-5 and Chapter 4-12
• HUD Memo issued 9/22/14
numbers posted?
• Does the o/a have a written TSP?
• Does it contain all required criteria from Chapter 4 of the HHB 4350.3?
• HUD-9834 - Section 14, Application Processing and Tenant Selection Plan, page 7 of 18 question g.
KHC Contact Poster
Project-Based Contract Administration staff:
(502) 564-4577
or email us at [email protected]
Multifamily Tenant Concerns COVID-19
page for all program areas:
• KHC staff will:
– Request copies of the required documents that
were provided with Addendum C and attached to
the Notification letter.
– Provide staff with a list of the random sampling of
current tenant files and move-out files that will
also be reviewed for compliance.
Documents Requested for Review
File Sampling Requirement see section 22 Summary of Tenant File Review page 11 of 18
HUD-9834 – Part I Desk Review
• Question 42: Are monthly rental subsidy vouchers submitted on time?
• Question 43 Is the o/a submitting tenant certification data to TRACS to support the voucher billing?
• Question 47 Does review of the EIV reports include info that needs a resolution?
• Question 51 Review complaints, congressional inquiries etc.
Tenant Selection Plan
Waiting List Master Log & Applications
HUD-9834 Part II On-site Review
• KHC staff will walk the property to observe general appearance and will ask about:
– REAC follow up
– Property Security, any concerns?
– Conduct tenant interviews and visit units with level 3 findings and visit a minimum of 2 vacant units (per MOR - FAQ issued by HUD).
– Ask about LBP and obtain copy of certification
HUD-9834 Part II On-site Review
Category C. Maintenance and Standard Operating Procedures
• Preventive Maintenance & how often completed
• Review a list of inventory or review system.
• Review written procedures for inspecting units.
• Review written procedures for completing work orders including written procedure for emergency work orders.
• Review documentation by unit with information on appliances.
• Review sampling of work orders.
HUD-9834 Part II On-site Review
Category D. Financial Management/Procurement
• KHC will not conduct a review/nor rate any of these items
HUD staff are responsible for this area and may choose to conduct a review per the HHB 4350.1, Chapter 6:
HUD-9834 Part II On-site Review
Category E. Leasing and Occupancy:
KHC will ask to review your Master Waiting List Log (MWLL)
• The log must include:
– Name of Head of Household
– Income Level ELI / VL / L
– Identification of the Need for Accessible Unit/Features
– Preference Status
– Unit Size
Note: there should also be notes/updates made to describe any actions taken with each application.
HUD-9834 Part II On-site Review
Category E. Leasing and Occupancy:
• Applications must include:
– Whether the applicant or any member of the applicant's household is subject to state lifetime sex offender registry
– Listing of states where the applicant and members of the household have resided
– Disclosure of SSN for the applicant and all members
– Owner must include as an attachment to the application form HUD-92006
HHB 4350.3, Chapter 4-14 and HUD-9834 Section 14
HUD-9834 Part II On-site Review
• Rejected Applications – reviewed under
Section 14 Application Processing and Tenant Selection:
• KHC will review information regarding preferences,
extremely low income targeting and screening.
• Are you handling applications consistently, moving folks in
order and according to your TSP and HUD requirements?
• What about in-house transfers? Do you maintain a list does
your TSP address priority.
HHB 4350.3, Chapter 4-14 and HUD-9834 page 7 of 18
HUD-9834 Part II On-site Review
Section 15 Leases and Deposits:
• KHC will review leases, addendums and security deposits.
– Are all sections completed consistently and correctly?
– Have all adult household members signed/dated?
– Rents collected and policy on late fee in compliance?
– Is the security deposit amount listed on the lease correct and does it match all other documents?
• the move-in HUD-50059,
• ledger cards etc.
– According to the lease is interest paid on the security deposit?
This information reviewed at the same time as current tenant files.
HUD-9834 Part II On-site Review
Section 16 Eviction/Termination of Assistance Procedures • KHC will review a random sampling of eviction files.
– Are tenants notified timely of termination?
– Documentation in the file to show reasons?
– Right to request meeting (10 calendar days)?
– Has the O/A provided VAWA forms 5230 & 5240?
HHB 4350.3 Chapter 8 – Owners must enforce the lease and house rules, and if lease obligations are not fulfilled, initiate termination proceedings to guarantee
the other residents’ health, safety, and peaceful enjoyment of the property.
Note: Addendum D must be completed to identify any eviction due to household member subject to a state lifetime sex offender registration.
HUD-9834 Part II On-site Review
HUD-9834 Part II On-site Review
Section 17 - EIV System Access and Security Compliance:
• KHC staff will review:
– CAAF/UAAF – initial and current
– Signed copies of Rules of Behavior for those not using system
but accessing reports
– Written Policies and Procedures for staff
HUD-9834 Part II On-site Review
Section 18 Compliance with using EIV Data and Reports:
• KHC staff will review:
– To ensure these are being ran according to HUD requirements
and the owner’s policy.
HUD-9834 Part II On-site Review
EIV Findings are a common MOR issue
• No evidence that the O/A was using the EIV system. The last reports in the file were for 2017.
• Missing Master file reports or tenant file reports.
• No documentation that errors noted in these reports were ever resolved or follow up on.
• No evidence that the Income Discrepancy Report or the No Income Report was printed at the time of the certification.
• Individual(s) with active access to the EIV system had not completed the annual Cyber Security Awareness Training – no certifications available for review.
HUD-9834 Part II On-site Review
Common EIV Findings Cont’d
• Existing Tenant Search reports being ran after the date of move-in.
• A copy of the Owner’s approval letter authorizing the coordinator, Dorothy of Kansas, access to the EIV system as the EIV Coordinator was not available for review. A copy should be placed in the EIV Master File.
• Move-in files reviewed did not contain evidence that the Income Report was ran and reviewed within 90 days after the transmission of the move-in certification to TRACS.
• HHB 4350.3, Chapter 9, Paragraph 9-8, Paragraph 9-12, Paragraph 9-19 and Paragraph 9-20.
HUD requires specific format to document findings
in the MOR Report
Condition: Management is not fully utilizing the Enterprise Income Verification (EIV) System. None of the mandatory EIV reports have been ran since 2018 and none were available for review on the day of the MOR.
Criteria: Per HUD Handbook 4350.3, REV-1, Change 4, Chapter 9, Paragraph 9-19. O/A’s are required to use EIV in its entirety as a third- party source to verify tenant employment and income information to reduce administrative and subsidy payment errors.
Cause: It appears there has been a lack of training and adequate supervision for the new property manager.
Effect: Failure to use EIV will result in a 5% reduction to the total voucher payment for the month following the date the violation was found and each subsequent voucher payment until the violation is cured.
Corrective Action: Provide an action plan for how management will provide the necessary training for staff and ensure that EIV reports are ran and followed up on according to HUD requirements and owner policy.
HUD-9834 Part II On-site Review
21. Tenant File Security
• KHC will ask to see/verify that tenant files and EIV information is kept locked and secured in a confidential manner.
– Is information being properly disposed of?
– Document retention in compliance?
• During the MOR review we ask that other persons not be in the room while going over tenant file information on the day of the review.
– Recommend to lock the office during this time
– Other staff without a business need should not be present while reviewing confidential tenant file information.
HUD-9834 Part II On-site Review
22. Summary of Tenant File Review
• Tenant File Review – See Addendum A
HUD-9834 Part II On-site Review
23. Tenant Concerns
– Written procedure for resolving tenant complaints or concerns.
– What about appeals?
coordinator, services offered
– Is the project staff able to adequately perform management and
maintenance functions?
Policies and Procedures, access to current HUD Notices
Addendum A – Tenant File Review
• Applicant Rejection
• Tenant Move-in
• Tenant Move-out
KHC will review a sample of rejected applications.
• Was a formal notice sent to the applicant?
• Was it clear the reason for the rejection?
• Did the manager provide copies of the required VAWA forms with the rejection letter to the applicant?
• Was applicant given opportunity for appeal the decision with someone other than the person making the initial decision?
Is it clear with in O/A policy that a third party must review and make final decisions on appeals?
HHB 4350.3, Chapter 4-14 and HUD-9834 Section 14
Addendum A – Tenant Move-In
KHC will review a sample of recent move-in files to determine:
• Was proper eligibility determined and tenant screened according to policy?
• Were all one-time documents obtained? Per HHB, 4350.3, Appendix 3
• Birth certificate
• Disability status
• Was the move-in inspection completed and were proper notes included on the form and was it signed/dated by all parties?
• Did all adult household members sign/date all the required documents such as but not limited to: the lease, the HUD 50059, the HUD-9887
Addendum A – Tenant Move-In
• Did management obtain proper verification of all income/assets/allowances for all household members?
• Were owner consent forms and HUD-9887 forms properly obtained signed and dated by all adult household members? NOTE: these forms expire 15 months after they are signed. Per HHB, Chapter 5-16A
• Were the HUD-92006 forms provided and obtained?
• Was the EIV system used to verify income? – Was the Existing Tenant Search ran prior to MI?
– Did the manager obtain the Income Verification report 90 days after the move-in was transmitted to TRACS?
• Did management provide the resident with copies of the Fact Sheet/Resident Rights/EIV and You Brochure/LBP?
• Was the tenant rent and security deposit calculated correctly?
Addendum A
Addendum A
Addendum A
Addendum A – Tenant Move-Out
KHC will review the following: • Did the Tenant provide a 30-day Notice of Intent to Vacate?
• Did management complete the MO Inspection?
– Was it completed timely and any damages documented?
– Was the tenant given an opportunity to attend?
– Was the form signed & dated by all parties?
• Security deposit refunded within 30 days? Was interest on the deposit paid?
• Did management provide an itemized list of damages and charges to the tenant?
• Security Deposit Disposition form complete and provided to tenant?
• Does the tenant’s move-out date (documented in file) match the date transmitted through TRACS?
• Was a copy of the HUD 50059A form, completed and maintained in the move- out file? Per the MAT Guide, Chapter 7.8, paragraph C.
Addendum A – Move-out File Review
Addendum A – Tenant Move-Out
Common Finding with Security Deposits
It is very important to know how the security deposit amount is
determined. Can you collect the TTP at move-in? OR should you use
the greater of $50 or TTP as the total for the Security Deposit. Are you
required to pay interest on the deposit?
For the following properties whose Section 8 New Construction with
AHAP executed before November 5, 1979 or Substantial Rehab with
AHAP executed before February 20, 1980 or an LMSA contract -
You must collect the TTP and you are not required to pay
Addendum A – Tenant Move-Out
Security Deposits Cont’d:
For all other properties whose Section 8:
New Construction with AHAP executed on or after November 5, 1979
or Substantial Rehab with AHAP executed on or after February 20,
1980 and all PDs and 202s
You must collect the greater of TTP or $50 and you are required
to pay interest.
Addendum A - Tenant Move-out
HHB 4350.3 Chapter 8-10 Allowable Use of Security Deposits
• If a tenant fails to pay the required rent or if there are tenant damages to the unit, an owner may use the tenant’s security deposit to pay the outstanding rent and/or damages. Any remaining funds must be paid to the tenant. An owner must follow the requirements and guidelines for security deposits and other charges outlined in paragraph 6-18 regarding the refunding and use of the security deposit.
Pet Deposit
Addendum A –
– Were the proper notices given timely?
– Was a 30-day notice of rent increase given?
– Certifications completed timely and accurately and
signed/dated by all parties?
Addendum B
• HUD requires that PBCA forward Part A of Addendum B to the owner/agent when scheduling an on-site review and to enter the information into the iREMS system.
• The owner or a principal in the ownership entity should sign the certification. If someone is signing on behalf of the owner, they must have power of attorney. (see MOR – FAQ document 5/5/06)
• If an owner does not sign or complete the information on Addendum B, the reviewer is required to issue a 10-day letter requiring the owner to submit the completed Addendum B. MFH staff is required to monitor the 10-day timeframe. If information is still not received, MFH staff is required to flag the owner in APPS.
Addendum C
available prior to the review.
• Review to ensure all policies and procedures and
other documents have been updated and comply
with all current HUD requirements.
• Most current version of policies & procedures
available to staff and to all properties?
Addendum C
Addendum D
– Be prepared to answer the questions provided on
this form.
HUD issues new requirements.
• Develop a system that works for you
• Use colored sheets of paper to separate Interim & Annual
• Place one-time documents on one side of the folder or
together in same location.
Be informed and share information with staff on new HUD
regulation changes.
• Sign up to receive notifications and HUD Newsletters.
– We recommend to sign up on HUD’s Multifamily RHIIP ListServ:
– https://www.hud.gov/program_offices/housing/mfh/rhiip/mfhrhiip
• When updating policy documents include a revision date at
the bottom and ensure all properties have a copy of the most
recent update.
Other – MOR Recommendations
Review Chapter 6 of the HHB 4350.1 – Overview of the Purpose of an MOR
– Requirement to use the HUD-9834
– PBCA and Owner requirements are outlined
– Information on ratings and completing the Summary Report.
– Information broken down by section of the HUD-9834 to reference back to the Statutory/Regulatory Requirements
– Appendix 2 - FAQs
MOR Summary Reports
• KHC will send a Summary Report to the owner with in 30- days of the date of the MOR.
• If there are no deficiencies noted, no additional action is required by the owner/agent.
• If there are deficiencies noted the owner must take action to resolve. – Targeted Completion Dates (TCD)s must be noted for all deficiencies
identified during the review and may not exceed 30 calendar days.
– Owners must provide documentation to support that the deficiencies were correct by the TCD.
– If additional time is needed the o/a must still submit an action plan.
MOR Summary Reports
• Owner’s are required to submit a response to KHC within
30 days of the date of the MOR cover letter (Summary
taken to correct any/all deficiencies noted.
• Do not send several different responses at different times.
Please include all information into one response.
MOR Summary Reports
• If there are items that were not responded to, you will
receive a follow up letter from KHC asking for additional
action to be taken on those items.
• HUD requires a response to all items.
• If you have a finding that requires a correction to a HUD
50059 you must be sure to transmit this.
– It is not a sufficient response to simply state it has been corrected.
We must ensure it is transmitted and any adjustments are applied
to the voucher request.
• For those items that cannot be completed in 30-days send
us a written plan that provides the following:
– Why the corrections could not be made within the 30-
– How you will address these items (remember to include
the details).
“Unsatisfactory” overall rating the o/a may
appeal the rating using the process outlined in
Chapter 6 of the HHB 4350.1.
MOR Resource Documents
• HUD Handbook 4350.1 – Appendix 2 - MOR – Frequently Asked Questions Document
• HUD Handbook 4350.3 – Know your Occupancy Rules – Get Training!
• HUD 9834 – Review It! -- HUD is currently reviewing the MOR process and we hope to see improvements in this process in the near future.
• Rent and Income Determination Quality Control Monitoring Guide for Multifamily Housing Programs – https://www.hud.gov/sites/documents/DOC_20477.PDF
MOR Resources on the web
HUD Notices: http://portal.hud.gov/hudportal/HUD?src=/program_offices/ad ministration/hudclips/notices/hsg
MOR Resources
APP for that!
• IRC 42 & Audit Guide Technical Advice Memos
• 8823 Guide IRS Notices