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HUD Issues New Guidance on Properties for Low-Income Seniors

The U.S. Department of Housing & Urban Development’s (HUD) Office of Multifamily Housing Programs has announced new guidance to reinforce the importance of required supportive service programs and the many allowable uses of supportive services funds to support independent living for seniors. The guidance applies to owners of properties participating in project-based rental assistance contracts (PRACs) under HUD’s Multifamily Section 202 Supportive Housing for Low-Income Elderly program, and includes details for the provision of individual services such as meal programs, and services such as transportation and health and wellness programs that can benefit the entire community at a property.

“Supportive services that facilitate independent senior living, increase safe socialization opportunities, and provide health and wellness benefits are a key component of our efforts to provide and expand deeply affordable rental housing for the nation’s low-income senior population,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “Today’s guidance reinforces the importance we place on supporting the health and well-being of seniors living independently in rental homes that receive contract rental assistance from HUD.”

The Section 202 Supportive Housing for the Elderly program helps expand the supply of affordable housing with supportive services for low-income seniors. The program provides capital advance funding to construct, acquire, or rehabilitate multifamily properties that serve very-low-income individuals 62 years of age or older. In addition to the capital advance, properties receive a renewable PRAC, which covers reasonable and necessary operating expenses beyond the tenant’s portion of the rent. Section 202 program eligibility requires residents to be very low-income or earning less than 50 percent of the area median income. Most households in the Section 202 program earn less than 30% of the median for their area.

The guidance provides requirements regarding the scope, content, and timeline for supportive services plans when property owners develop new plans or refresh existing plans as required to maintain funding eligibility through the Section 202 PRAC program. The guidance also clarifies that supportive service funds may be used to benefit the community as a whole–such as common area fitness equipment that can be used by all residents–when full resident participation does not significantly increase the operating budget of property or adversely affect the operation of the program.

“We are issuing this guidance today based on input from owners participating in the Section 202 PRAC program. These owners requested more details from HUD on how best to plan and execute effective services programs for residents at their properties while ensuring they are using funds in compliance with our requirements,” said Deputy Assistant Secretary for Multifamily Housing Ethan Handelman. “We will continue working with owners as they develop or renew plans that support both individual residents and the communities within a property that are so often one of the social lifelines for seniors.”

HUD has also launched a COVID-19 antigen test ordering portal. Tests are free of charge to owners and site-based staff who can register online and order test kits to be delivered directly to their properties on a weekly basis using HUD’s Health Partner Ordering Portal (HPOP).

About Author: Eric C. Peck

Eric C. Peck has 20-plus years’ experience covering the mortgage industry, he most recently served as Editor-in-Chief for The Mortgage Press and National Mortgage Professional Magazine. Peck graduated from the New York Institute of Technology where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books and has served as Copy Editor for Entrepreneur.com.
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