§1437t Authority to Convert Public Housing to Vouchers

Summary

A public housing agency may turn a public housing project (or part of one) into tenant-based vouchers under section 1437f, but only if it follows these rules. The agency must do an assessment first. The assessment must include a cost test showing whether vouchers are cheaper both on a net present value basis and in terms of new budget authority requirements than keeping the project for its remaining useful life; a market-value check before and after any rehab or conversion; a study of the local rental market and whether decent, safe units are available at or below the agency’s payment standard; the effect on the neighborhood; and a plan saying what the agency would do. Each agency had to submit such an assessment for each project no later than 2 years after the effective date under section 503(a) of the Quality Housing and Work Responsibility Act of 1998, though assessments can be done anytime and the Secretary can allow a simpler or shorter assessment. The agency can convert only if an assessment dated within one year shows the change will not cost more, will mainly help the residents, the agency, and the community, and will not reduce affordable housing in the area. The agency must make a conversion plan with resident participation and local officials, include it in its agency plan, describe future use and community impacts, and promise to: notify families 90 days before displacement (except for imminent health or safety risks); offer comparable housing that meets quality standards and is not in a less desirable location (this may be tenant-based assistance, project-based help, or a PHA unit at a similar rent); provide counseling and reasonable relocation costs; allow residents to stay and use vouchers in their unit if it remains housing; and use any proceeds under the limits in section 1437p(a)(5). The Secretary may reject a plan only if it clearly conflicts with the assessment, if reliable data contradicts the assessment, or if the plan otherwise fails to meet these rules. Funds used for tenant-based assistance, if approved by the Secretary, will be added to the agency’s annual contribution contract.