Changes in Public Housing Demolition/Disposition Residential Relocation
Requirements under Section 18 of the United States Housing Act of 1937
as amended by the Quality Housing Work Responsibility Act of 1998
(QHWRA)

The URA is not applicable to the relocation of residents based on an
approved application for demolition or disposition of public housing
units under Section 18 of the United States Housing Act of 1937 (the
1937 Act) (with or without HUD financial assistance) after October 21,
1998 (the effective date for the Quality Housing and Work Responsibility
Act (QHWRA) of 1998 (P.L. 105-276)). Section 18 includes relocation
provisions for residents of covered projects that are similar to, but
not identical to, the URA. (See chart)

## Activities Covered by Section 18 Relocation Provisions

Generally, Section 18 of the 1937 Act governs Public Housing Agency
(PHA) activities to demolish or dispose of part or all of a public
housing project.[^1] The relocation provisions of Section 18(a)(4) apply
to:

-   Any demolition or disposition of public housing unless specifically
    excepted out by statute (e.g., severely distressed public housing
    demolition pursuant to a revitalization plan (HOPE VI) under Section
    24(g)).

-   Consolidation of occupancy in public housing either within a
    building, among buildings, or between a public housing project and
    other housing under Section 18(e). The purpose of such consolidation
    must be to improve the living conditions of residents or to provide
    greater efficiency in serving the residents. *See* 42 U.S.C.
    1437p(e).

-   The so-called ''*de minimis*'' demolition exception from the
    statute's requirements (see Section 18(f)). This provision allows a
    PHA to demolish the lesser of five units or five percent of the
    total number of dwelling units owned by the PHA in any five-year
    period, if the space occupied by the demolished unit or units is
    used for meeting the service or other needs of the residents or if
    the unit or units are beyond repair. The statute does not define
    what conditions constitute "beyond repair".

-   Demolition of public housing units using Capital Funds under Section
    9(d)(F).

## Activities Not Covered by Section 18 may be covered by URA Relocation Provisions

By its own terms, Section 18 does not apply to acquisition or
rehabilitation activities undertaken by PHAs. The URA, therefore, would
apply to any displacement resulting from PHA acquisition or
rehabilitation of real property for a federally-assisted program or
project.

Implementing regulations at 24 CFR Part 970.2(a)(1) thru (12) provide
additional guidance on the activities and structures not covered by
Section 18.[^2] However, not all of these activities are subject to the
URA (which is limited to displacement caused by acquisition,
rehabilitation, or demolition). Generally, section 970.2[^3] identifies
two types of situations:

\(1\) Where the PHA may own or operate the structures/units but the
activities do not fall under the governance of Section 18 -- generally
because the units are not public housing units under an ACC (e.g.,
section 8 housing) or the units are public housing projects but the
demolition or disposition of which are excepted from Section 18 coverage
by statute; and

\(2\) activities that concern the demolition of, or removal of,
PHA‑owned units from public housing use, which would normally be
considered demolition or disposition under Section 18 but as a
regulatory matter are determined not subject to the subject to the
requirements of Section 18.[^4]

Activities and structures falling under the first situation which would
trigger the relocation provisions of the URA include:

-   Demolition (but not disposition) of severely distressed units as
    part of a revitalization plan under Section 24 of the Act, 42 U.S.C.
    1437v (HOPE VI) approved after October 21, 1998;

-   Demolition (but not disposition) of public housing developments
    removed from a PHA's inventory under Section 33 of the Act, 42
    U.S.C. 1437z-5 (required conversion of distressed public housing to
    tenant-based assistance);

-   Demolition of PHA-owned Section 8 housing, or housing leased under
    former Sections 10(c) or 23 of the U.S. Housing Act;

-   Demolition of public housing converted pursuant to sections 22 of
    the 1937 Act.

> Activities and structures falling under the second situation which
> would trigger the URA relocation provisions include:

-   A whole or partial taking for a federally-assisted project, by a
    public or quasi-public entity (taking agency) authorized to take
    real property by its use of police power or exercise of its power of
    eminent domain under state law;

-   Demolition after conveyance of a public housing project to a non-PHA
    entity in accordance with an approved homeownership program under
    Title III of the Cranston‑Gonzalez National Affordable Housing Act
    (HOPE I), 42 U.S.C. 1437aaa note.

# [RELOCATION ASSISTANCE PROVIDED PURSUANT TO SECTION 18.]{.underline}

Pursuant to section 18, a PHA must provide relocation assistance (e.g.,
the payment of actual and reasonable relocation expenses) to residential
tenants. Generally, there is no assistance provided for the displacement
of businesses (including non-profit organizations) occupying public
housing property. However, where the business is part of a mixed finance
development and the property is not owned by the PHA, or the property is
owned or leased by the PHA and the demolition or disposition activity is
not otherwise subject to Section 18, any federally-assisted activity
involving acquisition, rehabilitation, or demolition that results in the
displacement of a business, non-profit organization or farm may be
subject to URA requirements.

# [EXAMPLES]{.underline}

1\. A PHA proposes to dispose of public housing units for homeownership
pursuant to section 32 of the 1937 Act. The PHA provides purchasing
families with downpayment assistance from amounts it received under
section 9(d) of 1937 Act (the "Capital Fund"). Tenant-occupants in
non-public housing who are displaced by the purchasing families would be
eligible for relocation assistance under the URA (an owner-occupant who
is selling the property may not be). Section 32(e) also provides
statutory relocation requirements specific to the homeownership program
that must be followed for the public housing tenants who do not exercise
the right of first refusal. *See* 24 CFR 906.23. Relocation Assistance
under the URA and section 32 may overlap in many respects. For example,
for a tenant displaced from a public housing unit, the provision of
public housing, project-based assistance, or tenant-based assistance
under section 32(e) would meet the requirements for a comparable
replacement dwelling under the URA.

2\. A PHA leases PHA-owned commercial space to a non-profit organization
incident to its normal operation. The PHA subsequently decides to
rehabilitate the structure using HUD financial assistance. The
rehabilitation results in the business tenant's displacement. By
regulation (see 970.3(c))[^5] the rehabilitation activity is not subject
to Section 18 requirements. However, the activity may be subject to the
URA.[^6]

3\. A PHA, using a HOPE VI Demolition-Only grant (as opposed to a
Revitalization Grant) and Capital Funds, proposes to demolish severely
distressed public housing units and PHA‑owned Section 8 housing in the
same project. The demolition of the public housing units is subject to
Section 18, and thus the URA does not cover the resulting displacement
of the public housing tenants. However, the demolition of the Section 8
units is not subject to Section 18 and, therefore, relocation of the
Section 8 tenants is subject to the URA.

4\. A PHA proposes to demolish public housing units pursuant to Section
18. The PHA proposes to receive CDBG or HOME funds from a city to
carryout the demolition. Although the URA may not apply to public
housing demolition, the use of CDBG or HOME funds for demolition will
trigger the applicability of section 104(d) of the Housing and Community
Development Act of 1974, as amended, (including the relocation
provisions, the one for one replacement housing provisions) and the URA.

Relocation Assistance for Displaced Public Housing Tenants: URA vs.
Section 18

+----------------+-------------------------+--------------------------+
|                | URA                     | Section 18               |
+================+=========================+==========================+
| Moving &       | # PHA choice!           | -   Actual and           |
| Related        |                         |     reasonable           |
| Expenses (PHA  | -   PHA move resident   |     relocation expenses  |
| unit move to a |     with force account  |                          |
| PHA unit)      |     staff or contractor |                          |
|                |     (\$100 allowance to |                          |
|                |     resident), **or**   |                          |
|                |     allow resident to   |                          |
|                |     choose:             |                          |
|                |                         |                          |
|                |     -   Payment for     |                          |
|                |         actual costs of |                          |
|                |         a self-move, or |                          |
|                |                         |                          |
|                |     -   Payment for     |                          |
|                |         self-move at    |                          |
|                |         DOT schedule    |                          |
|                |         amount or       |                          |
|                |                         |                          |
|                |     -   A combination   |                          |
|                |         of both.        |                          |
+----------------+-------------------------+--------------------------+
| Moving &       | **Resident's choice!**  | -   Actual and           |
| Related        |                         |     reasonable           |
| Expenses (PHA  | -   Payment for actual  |     relocation expenses  |
| unit move to   |     costs of a          |                          |
| non-public     |     Self-move, or       |                          |
| housing---with |                         |                          |
| or without     | -   Payment for         |                          |
| Voucher        |     self-move at DOT    |                          |
| assistance)    |     schedule amount, or |                          |
|                |                         |                          |
|                | -   A combination of    |                          |
|                |     both.               |                          |
|                |                         |                          |
|                | -   (Optional) PHA may  |                          |
|                |     offer to move       |                          |
|                |     resident with force |                          |
|                |     account staff or    |                          |
|                |     contractor (\$100   |                          |
|                |     allowance to        |                          |
|                |     resident)           |                          |
+----------------+-------------------------+--------------------------+
| Replacement    | -   Offer comparable    | -   Provide comparable   |
| Housing        |     replacement         |     housing which may    |
|                |     dwelling which may  |     be:                  |
|                |     be:                 |                          |
|                |                         |     -   Tenant based     |
|                |     -   Tenant based    |         assistance       |
|                |         assistance      |         (voucher)        |
|                |         (voucher)       |                          |
|                |                         |     -   Project-based    |
|                |     -   Project-based   |         assistance       |
|                |         assistance      |                          |
|                |                         |     -   Public housing   |
|                |     -   Public housing  |         unit             |
|                |         unit            |                          |
+----------------+-------------------------+--------------------------+
| Replacement    | -   Computed on         | -   No Replacement       |
| Housing        |     42-month period     |     Housing Payment      |
| Payment        |                         |                          |
|                | -   Amount needed to    | -   No provisions for    |
|                |     reduce new          |     "gap" payments       |
|                |     rent/utility costs  |                          |
|                |     to the lower of old |                          |
|                |     rent/utility costs  |                          |
|                |     or (for low income  |                          |
|                |     persons only, 30%   |                          |
|                |     of gross monthly    |                          |
|                |     income)             |                          |
|                |                         |                          |
|                | -   "Gap" payments may  |                          |
|                |     be necessary even   |                          |
|                |     between old PHA     |                          |
|                |     rent/utilities and  |                          |
|                |     new subsidized      |                          |
|                |     rent/utilities      |                          |
+----------------+-------------------------+--------------------------+
| Notices        | -   General Information | -   90 day notice to     |
|                |     Notice (GIN)        |     move                 |
|                |                         |                          |
|                | -   Notice of           |                          |
|                |     Eligibility or      |                          |
|                |     Non-displacement at |                          |
|                |     ION                 |                          |
|                |                         |                          |
|                | -   90 day notice to    |                          |
|                |     vacate              |                          |
+----------------+-------------------------+--------------------------+
| Services       | -   Advisory services   | -   Necessary counseling |
|                |                         |                          |
|                |     -   Determine       | ```{=html}               |
|                |         resident needs  | <!-- -->                 |
|                |         and preferences | ```                      |
|                |                         | -   Mobility counseling  |
|                |     -   Explain         |                          |
|                |         payments and    |                          |
|                |         assistance      |                          |
|                |                         |                          |
|                |     -   Current and     |                          |
|                |         continuing      |                          |
|                |         information on  |                          |
|                |         comparable      |                          |
|                |         housing         |                          |
|                |                         |                          |
|                |     -   Inspection of   |                          |
|                |         replacement     |                          |
|                |         housing         |                          |
|                |                         |                          |
|                |     -   Assistance      |                          |
|                |         filling out     |                          |
|                |         claim forms     |                          |
|                |                         |                          |
|                |     -   Mobility        |                          |
|                |         counseling      |                          |
|                |                         |                          |
|                |     -   Transportation  |                          |
|                |         to inspect      |                          |
|                |         replacement     |                          |
|                |         housing         |                          |
|                |                         |                          |
|                |     -   Advice on other |                          |
|                |         assistance      |                          |
|                |         sources         |                          |
|                |                         |                          |
|                |     -   Information on  |                          |
|                |         federal and     |                          |
|                |         state housing   |                          |
|                |         programs        |                          |
+----------------+-------------------------+--------------------------+

[^1]: Public housing includes housing assisted under the 1937 Act, other
    than section 8. 24 CFR 5.100. This includes dwelling units that are
    owned by PHAs and that are subject to Annual Contributions Contracts
    (ACCs) under the 1937 Act; and dwelling units in a mixed finance
    project that are assisted by a PHA with capital or operating funds.

[^2]: Reference should also be made to PIH Notice 2005-32. This Notice
    updates Notice 99-19 to reflect changes to the requirements for
    demolition and disposition processing, as well as revisions made to
    the associated application form HUD-52860 in 2002. The purpose of
    the notice is as follows: (1) to clarify the applicability of
    Section 18 to a HOPE VI related demolition; (2) to inform PHAs of
    the changes to Section 18 by Section 531 of QHWRA; (3) to provide
    guidance on the criteria HUD will use to process
    demolition/disposition applications; and (4) to discuss the new
    certification required under QHWRA. It should be noted that HUD
    published a proposed rule on December 15, 2004 (69 FR 75188)
    entitled "Demolition or Disposition of Public Housing Projects." The
    rule proposed to implement revisions to Section 18 of the 1937 Act
    made by the QHWRA of 1988.

[^3]: The proposed rule (69 FR 75188) would codify this provision at 24
    CFR §970.3.

[^4]: The proposed rule (69 FR 75188) would essentially separate these
    activities into two categories as described under §§ 970.3(b) and
    (c).

[^5]: See footnote Error: Reference source not found.

[^6]: Note that generally the reference in section 970.3 to "\[t\[he
    leasing of dwelling or non-dwelling space incident to the normal
    operation of the project for public housing purposes, as permitted
    by the ACC" refers to the PHA's leasing out of PHA-owned, public
    housing space (e.g., property under an ACC) for PHA operations.
    While the leasing of dwelling space under this provision may result
    in the displacement of public housing residents, the residential
    lease may generally allow transfers of residents to other units for
    such activities.