31168 Federal Register / Vol. 83, No. 128 / Tuesday, July 3, 2018 / Notices 

1The RAD statutory requirements were amended 

by the Consolidated Appropriations Act, 2014 (Pub. 

L. 113–76, signed January 17, 2014), the 

Consolidated and Further Continuing 

Appropriations Act, 2015 (Pub. L. 113–235, signed 

December 16, 2014), the Consolidated 

Appropriations Act, 2016 (Pub. L. 114–113, signed 

December 18, 2015), the Consolidated 

Appropriations Act, 2017 (Pub. L. 115–31, signed 

May 4, 2017), and the Consolidated Appropriations 

Act, 2018 (Pub. L. 115–141, signed March 23, 2018). 

The statutory provisions of the 2012 Appropriations 

Act pertaining to RAD, as amended, are referred to 

as the RAD statute in this notice. 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–6105–N–01] 

Rental Assistance Demonstration: 

Implementation of Certain Fiscal Year 

(FY) 2018 Appropriations Act 

Provisions 

AGENCY: Office of the Assistant 

Secretary for Housing-Federal Housing 

Commissioner and Office of the 

Assistant Secretary for Public and 

Indian Housing, HUD. 

ACTION: Notice. 

SUMMARY: This notice implements 

several changes to HUD’s Rental 

Assistance Demonstration (RAD) 

program that were enacted in the 

Consolidated Appropriations Act, 2018 

(2018 Appropriations Act). For 

participants under the First Component 

of RAD relating to Public Housing 

conversions, this notice increases the 

number of public housing units that 

may be awarded competitively and 

extends the application deadline. In 

order to implement the unit increase, 

the notice describes how HUD will set 

initial contract rents for awards made 

pursuant to the expansion of RAD, 

simplifies the process by which public 

housing agencies (PHAs) can withdraw 

and replace their existing awards, serves 

as notification to PHAs that have 

submitted Letters of Interest (LOI) that 

to reserve their position on the RAD 

waiting list they must take additional 

steps to secure their award, and 

modifies the latest possible date for 

PHAs to submit an application for the 

final phase of a project covered by a 

Multi-phase Award. For the Second 

Component of RAD, this notice 

implements two provisions of the 2018 

Appropriations Act relating to initial 

rent setting for the conversion of Rent 

Supplement (Rent Supp) and Rental 

Assistance Payment (RAP) properties 

and to the prohibition against 

rescreening residents. 

DATES: This notice is applicable on July 

3, 2018. 

ADDRESSES: Interested persons are 

invited to submit questions or 

comments electronically to rad@

hud.gov. 

FOR FURTHER INFORMATION CONTACT: 

William A. Lavy, Director, Program 

Administration Division, Office of 

Recapitalization, Office of Multifamily 

Programs, Department of Housing and 

Urban Development, 451 Seventh Street 

SW, Room 6230, Washington, DC 20410; 

telephone 202–708–0614. (This is not a 

toll-free number.) Individuals with 

speech or hearing impairments may 

access this number through TTY by 

calling the toll-free Federal Relay 

Service at 1–800–877–8339. To assure a 

timely response, HUD recommends that 

requests for further information be 

submitted electronically to the email 

address rad@hud.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

On March 23, 2018, section 237 of 

Title II, Division L—Transportation, 

Housing and Urban Development, and 

Related Agencies, of the Consolidated 

Appropriations Act, 2018 (Pub. L. 115– 

141) (2018 Appropriations Act), 

amended the RAD statute, as authorized 

in Title II, Division C, of the 

Consolidated and Further Continuing 

Appropriations Act, 2012, (Pub. L. 112– 

55) by, among other changes, (1) 

increasing the unit cap from 225,000 

units to 455,000 units and extending the 

period for project applications until 

September 30, 2024, under the RAD 

First Component, which allows for the 

conversion of assistance under the 

public housing program to long-term, 

renewable assistance under Section 8; 1

(2) establishing that contracts provided 

through the conversion of properties 

currently assisted through the Rent 

Supp and RAP programs that are located 

in high-cost areas shall have initial 

contract rents set at comparable market 

rents for the market area; and (3) 

establishing that conversions of 

assistance under the Second Component 

may not be the basis for re-screening or 

termination of assistance or eviction of 

any tenant family in a property 

participating in the demonstration and 

such a family shall not be considered a 

new admission for any purpose, 

including compliance with income 

targeting. 

The most recent version of the RAD 

program notice, Rental Assistance 

Demonstration—Final Implementation, 

Revision 3 notice (PIH 2012–32 (HA) H 

2017–03, REV–3), was published on 

January 12, 2017 and can be found on 

RAD’s website, www.hud.gov/RAD. Its 

publication was announced on January 

19, 2017 at 82 FR 6615. 

II. First Component: RAD Unit Cap 

Increase and Rent Setting 

This notice announces the following: 

1. For Commitments to enter into a 

HAP contract (CHAPs), portfolio 

awards, and multi-phase awards issued 

on or after January 1, 2019, for which 

HUD has authority to make awards 

under the 455,000 unit statutory cap, 

HUD will use rent levels based on the 

FY 18 RAD rent base year, which will 

be published once the final public 

housing operating subsidy obligation is 

made for FY 18. 

2. To permit the PHAs on the waiting 

list to commence their RAD conversions 

without delay, for CHAPs, portfolio 

awards, and multi-phase awards issued 

between the effective date of this notice 

and January 1, 2019, for which HUD has 

authority to make awards under the 

455,000 unit statutory cap, HUD is 

modifying the FY 16 RAD rent base year 

methodology by replacing the PHA’s FY 

16 Capital Fund Formula Grant 

attributable to the project with the 

PHA’s FY 18 Capital Fund Formula 

Grant attributable to the project once 

available for the Capital Fund 

component of the contract rent. All 

other components of the contract rent 

(i.e., Operating Fund and tenant rents) 

will continue to be based on FY 16 

levels. Rent levels continue to be subject 

to the rent setting limitations detailed in 

PIH 2012–32 (HA) H 2017–03, REV–3. 

Further, these rents will be adjusted 

each year by HUD’s published 

Operating Cost Adjustment Factors 

(OCAF) starting in Calendar Year (CY) 

19, rather than CY 17, and the adjusted 

rents will be established in the Housing 

Assistance Payment (HAP) contracts at 

the time of conversion. 

3. HUD is now able to award RAD 

authority to certain projects where 

PHAs have submitted LOIs to reserve 

their position on the RAD waiting list if 

they submit a complete RAD 

Application, portfolio award request, or 

multi-phase award request for the 

number of units identified in their LOIs 

by September 4, 2018. By an email sent 

on or before the publication date of this 

notice, HUD will identify and notify 

each PHA that may submit an 

application or request for an award as a 

result of the expansion. Failure to make 

a complete submission for the reserved 

units (that is, submit a complete 

application or request) by September 4, 

2018 will result in a forfeiture of the 

PHA’s position on the waiting list. 

4. For all multi-phase awards issued 

after March 22, 2018, PHAs will have 

until September 30, 2024, to submit an 

application for the final phase of the 

project covered by the multi-phase 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 128 / Tuesday, July 3, 2018 / Notices 31169 

award. For any multi-phase awards 

issued prior to March 22, 2018, HUD 

may approve extensions up to 

September 30, 2024 on a case-by-case 

basis. 

5. When a PHA returns RAD authority 

to HUD by submitting a voluntary 

withdrawal of a project and 

subsequently requests new RAD 

authority for the same project within 

one month thereafter, provided that 

HUD has authority to make awards 

under the 455,000 unit statutory cap, 

HUD may approve issuance of a 

replacement CHAP without the 

requirement that the PHA submit the 

application materials that would 

otherwise be required. The replacement 

CHAP will include the original CHAP 

issuance date, but will have rents based 

on the applicable RAD rent base year as 

described above. For example, a 

withdrawal of a CHAP and subsequent 

request for new RAD authority that 

occurs in September of 2018 would 

have rents based on FY 16 rent levels as 

modified in Paragraph 2. 

III. Second Component: Initial Contract 

Rents for Rent Supplement and RAP 

Conversions 

For Project Based Rental Assistance 

(PBRA) conversions, properties 

currently assisted through the Rent 

Supp and RAP programs that are located 

in High Cost Areas as identified in 

Housing Notice 2017–06 shall have 

initial rents set at comparable market 

rents, without regard to any Fair Market 

Rent (FMR) cap, but as otherwise 

described in PIH 2012–32 (HA) H 2017– 

03, REV–3. Over the 20-year term of the 

HAP contract, contract rents will be 

adjusted using the processes described 

in the HUD Section 8 Renewal Policy 

Guidebook under Option 1A: Mark-UpTo-Market. 

For Project-Based Voucher (PBV) 

conversions, HUD is not prepared to 

implement this modification to initial 

contract rent setting at this time. 

IV. No Rescreening of Tenants Upon 

Conversion Under the Second 

Component 

At conversion under the RAD Second 

Component, current households cannot 

be excluded from occupancy at the 

Covered Project (as defined in the RAD 

program notice) based on any 

rescreening, income eligibility, or 

income targeting. With respect to 

occupancy in the Covered Project, 

current households in the Converting 

Project will be grandfathered for 

application of any eligibility criteria to 

conditions that occurred prior to 

conversion but will be subject to any 

ongoing eligibility requirements for 

actions that occur after conversion. 

These protections also apply when a 

household is relocated to facilitate 

construction or rehabilitation work 

following conversion and subsequently 

returns to the Covered Project. Postconversion, the tenure of all residents of 

the Covered Project is protected 

pursuant to PBV or PBRA requirements 

regarding continued occupancy. For 

example, a unit with a household that 

was over-income at time of conversion 

would continue to be treated as an 

assisted unit. Thus, 24 CFR 982.201, 

concerning eligibility and targeting of 

tenants for initial occupancy, and the 

first clause of section 8(c)(4) of the 

United States Housing Act of 1937 and 

24 CFR 880.603(b), concerning 

determination of eligibility and 

selection of tenants for initial 

occupancy, will not apply for current 

households. Once the grandfathered 

household moves out, the unit must be 

leased to an eligible family. 

V. Finding of No Significant Impact 

A Finding of No Significant Impact 

(FONSI) with respect to the 

environment has been made in 

accordance with HUD regulations in 24 

CFR part 50, which implemented 

section 102(2)(C) of the National 

Environmental Policy Act of 1969 (42 

U.S.C. 4332(2)(C)). The FONSI is 

available for public inspection during 

regular business hours in the 

Regulations Division, Office of General 

Counsel, Department of Housing and 

Urban Development, 451 7th Street SW, 

Room 10276, Washington, DC 20410– 

0500. Due to security measures at HUD 

Headquarters building, please schedule 

an appointment to review the FONSI by 

calling the Regulations Division at 202– 

708–3055 (this is not a toll-free 

number). Individuals with speech or 

hearing impairments may access this 

number via TTY by calling the Federal 

Relay Service at 800–877–8339. 

Dated: June 22, 2018. 

Dominique Blom, 

General Deputy Assistant Secretary for Public 

and Indian Housing. 

Brian Montgomery, 

Assistant Secretary for Housing, Federal 

Housing Commissioner. 

[FR Doc. 2018–14248 Filed 7–2–18; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–6106–N–01] 

Rental Assistance Demonstration: 

Supplemental Guidance on Final 

Notice 

AGENCY: Office of the Assistant 

Secretary for Housing-Federal Housing 

Commissioner and Office of the 

Assistant Secretary for Public and 

Indian Housing, HUD. 

ACTION: Notice. 

SUMMARY: On July 26, 2012, HUD 

announced through notice in the 

Federal Register the implementation of 

the statutorily authorized Rental 

Assistance Demonstration (RAD), which 

provides the opportunity to test the 

conversion of public housing and other 

HUD-assisted properties to long-term, 

project-based Section 8 rental 

assistance. The July 26, 2012 notice 

provided for full implementation of 

RAD, and the posting of the Final 

Program Notice (Final Program Notice, 

PIH–2012–32) on HUD’s RAD website. 

HUD subsequently issued a number of 

revised program notices, the most recent 

on January 12, 2017 (PIH 2012–32/ 

Housing 2017–03 REV–3). This notice 

announces the posting of a supplement 

to the most current notice PIH 2012–32/ 

Housing 2017–03 REV–3 (RAD 

Supplemental Notice, PIH 2018–11/H 

2018–05). As provided by the RAD 

Statute, this notice addresses the 

requirement that the demonstration may 

proceed after HUD publishes the terms 

of the notice in the Federal Register. 

This notice summarizes the key changes 

made to the PIH 2012–32/Housing 

2017–03 REV–3 through the RAD 

Supplemental Notice, PIH 2018–11/H 

2018–05. This notice also meets the 

RAD statutory requirement to publish at 

least 10 days before they may take 

effect, waivers and alternative 

requirements authorized by the statute, 

which does not prevent the 

demonstration, as modified, from 

proceeding immediately. 

DATES: The RAD Supplemental Notice, 

PIH 2018–11/H 2018–05, other than 

those items listed as new statutory or 

regulatory waivers or alternative 

requirements specified in this notice, is 

effective July 3, 2018. 

The new statutory and regulatory 

waivers and alternative requirements 

are effective July 13, 2018. 

ADDRESSES: Interested persons are 

invited to submit questions or 

comments electronically to rad@

hud.gov. 


sradovich on DSK3GMQ082PROD with NOTICES