Rental Assistance Demonstration (RAD) Program Resident Information Meetings June 24, 2015
What is RAD? The Rental Assistance Demonstration (RAD) is a HUD program that will allow the Housing Authority to convert properties from conventional public housing support under Section 9, with traditional capital fund subsidies and operating fund subsidies, to Project Based Section 8 program with a Housing Assistance Payment (HAP)contract.
How does RAD Work? $900 $800 $700 $600 $500 $400 $300 $200 $100 Sample Public Housing Conversion Per Unit Monthly Current Public Housing Funding Operating Fund $330 Capital Fund $144 Tenant Payment $318 $792 RAD Funding Housing Assistance Payment $474 Tenant Payment $318 RAD combines the operating subsidy and capital fund into one payment for the property $- Pre-Conversion Post-Conversion
How Does RAD Work? Replaces the HUD deed of Trust with a RAD use agreement so the Authority can borrow against the property to fund renovations Locks in the current level of project subsidies in a Section 8 HAP contract with built-in annual increases that would address inflation. Units are managed and operated under the Section 8 regulations.
Why was RAD established? Across the Country and here in Norfolk the public housing inventory is aging, becoming more obsolete and has an increasing backlog of unmet capital funding needs. Capital funding has declined 24% over the past decade and is insufficient to meet the growing backlog of capital needs. RAD will provide defined and more secure project subsidy from HUD. This will allow the Authority to more easily seek Low Income Housing Tax Credits to renovate communities and build new housing RAD creates greater funding certainty while allowing increased operational flexibility for the Authority
Impact on residents? Will the rent residents pay change a result of RAD? Residents will continue to pay no more than 30% of adjusted income. If RAD conversion results in a resident s rent going up by more than 10% or $25.00 per month the increase will be phased in over a 3 to 5 year period. Will residents have to sign a new lease? Yes, however, current public housing residents will not be rescreened, or face other income eligibility criteria or income targeting provisions. If you are lease compliant before RAD conversion you can not be displaced Will Residents be displaced? No permanent involuntary displacement. Residents temporarily relocated will have a Right to Return
Impact on residents? Requirements for adequate written notice of lease termination and access to grievance process are retained Residents may still participate in Family Self- Sufficiency and Resident Opportunities and Self- Sufficiency programs Residents can still operate tenant organization and NRHA must still provide at least $15 per occupied unit annually for the tenant organization A resident s lease must be renewed unless cause exists
Impact on residents? Choice mobility allows residents to leave the project after one year (if convert to PBV) or two years (if convert to PBRA). The Authority must provide a Housing Choice Voucher, if available, or place the resident at the top of the waiting list Affected Households that do not want to transition to new program can be offered transfers to other public housing communities
First Phase RAD Projects Young Terrace (Modernization) Diggs Town (Modernization) North Wellington (Update) Broad Creek Phase II Units (Repairs) Grandy Village (08, 032 & 092) (Demolition, New construction and repairs)
Renovation Significant Modernization and Renovation of Young Terrace & Diggs Town As part of RAD conversion, NRHA will pursue Low Income Housing Tax Credits to modernize and renovate Young Terrace and Diggs Town A design team will work with residents and property managers to develop a renovation plan for each community Will include demolition of units to provide more parking and open space in the community Renovation Plans will be developed over the next 6 to 9 months Renovation would not begin until 2017 and would be done in phases over a 3 to 5 year period.
Relocation Residents will be temporarily relocated for renovation The Authority is responsible for relocation expenses Residents will be offered ability to stay within the community and should not be displaced more than 12 months Any temporary relocation more than 12 months must comply with Uniform Relocation Act Residents will be offered a choice to 1) temporary relocate or 2) to relocate permanently using a Housing Choice Voucher or 3) move to another public housing community.
Second Phase RAD Projects Franklin Arms (Repairs) Broad Creek Phase III & IV Units (Repairs) NRHA is also exploring RAD for Tidewater, Oakleaf Forest and Calvert Square. Additional studies will be done next year to determine whether these communities may benefit from the RAD program.
When will RAD Conversion Happen? Authority Submits Application June 30, 2015 HUD Reviews and if Approved Awards CHAP September 2015 Authority Submits financing Plan June 2016 HUD Accepts Financing Plan August 2016 Execute HAP w/hud & Close on Financing December 2016 Conversion Complete and Begin Modernization January 2017 NOTE: NRHA will have the option at any time in the process to withdraw its RAD applications and is not committed until it actually executes the HAP contract with HUD. Projects that do not require modernization may complete the RAD conversion process sooner
Next Steps The number of RAD units is limited and more and more authorities are opting to convert to RAD. This application will hopefully get NRHA in line so we can continue to evaluate the program For NRHA to pursue RAD the following steps should be pursued Prepare Application(s) for Potential RAD projects Continue to Meet with Communities and Discuss RAD Begin LIHTC Renovation Planning for Diggs Town and Young Terrace Await HUD Response Continue to Brief NRHA Board Continue to Evaluate if RAD will benefit the communities
Questions & Answers