Rule Will Worsen TARs Problems
On Friday, December 1, HUD published a proposed rule with a 60-day comment period. “Under this proposed rule, when tenants who reside in public housing or in properties receiving project-based rental assistance (PBRA) face eviction for nonpayment of rent, public housing agencies (PHAs) and owners would need to provide those tenants with written notification at least 30 days prior to the commencement of a formal judicial eviction procedure for lease termination.”
PHADA will immediately begin preparing detailed and specific comments in response to this notice after careful review of the notice, referenced supporting documentation, and prior PHADA correspondence with HUD and the Hill on this policy.
The negative and disparate impacts of eviction that have resulted from the current laws governing residential rental properties and landlord/tenant relations are well presented. However, HUD has not made a convincing argument that imposing a 30-day notice policy only on owners of federally assisted housing will positively impact outcomes that result from the state-governed and market-driven fundamentals of our rental housing lease enforcement structures. Furthermore, HUD has not addressed the impact this requirement has on Tenant Accounts Receivable (TARs) and the fiscal impact on owners of uncollected rent.
PHADA has been consistent in calling on HUD to recognize the seriousness of the rise in TARs, the growing risk to agency solvency that results, and the role the 30-day notice requirement plays in exacerbating this growing financial issue. As detailed in PHADA’s September 29, letter to Secretary Fudge, the Department should immediately share additional information on TARs and the financial status of public housing agencies and other owners, should make PHAS scoring modifications related to TARs, and should make the 30-day notice for non-payment a recommendation, not a requirement. As PHADA President Mark Gillett highlights in his recent column, increased TARs are one factor, along with rising insurance and other costs and inadequate appropriations, contributing to severe financial risk for many agencies and affordable housing owners and operators. The 30-day notice requirement exacerbates these challenges and risks.
PHADA encourages members to share how making this provision permanent will impact your agency and your tenants. HUD specifically asks for feedback on HA experience with the 30-day requirement under the interim final rule. Specific real-life examples and/or data showing negative impacts of the longer notice period would be most effective in getting any responsiveness from HUD. Please send any and all feedback on this issue to: email@example.com, and/or join our discussion of this issue at the Housing Committee meeting during PHADA’s Commissioners’ Conference in early January!