HUD Issues Notice on Upgraded Electrical Outlets and Verification of HQS Deficiency Correction

Summary:  On Monday, June 3, 2011 HUD issued a notice (PIH Notice 2011-29) to among other things, renew PIH Notice 2010-10 regarding HUD’s program requirements that apply to Housing Quality Standards (HQS) and supplementary guidance that PHAs and inspectors may rely upon when conducting inspections. The second section deals with the issue of electrical receptacles. Specifically, "upgraded" outlets that have been changed from two-pronged to three-pronged are the major area of concern in HUD's notice.  PIH Notice 2011-29 adds a section to last year’s notice regarding the regulations pertaining to PHAs’ discretionary authority to verify HQS deficiency corrections.

Verification of HQS Deficiency Correction

This section of HUD’s notice provides clarification regarding the need to conduct a follow-up inspection for tenant based voucher units after a failed annual or interim inspection.

If the PHA determined from the inspection that the unit did not meet the HQS requirements, the PHA may allow the unit to pass upon verification that the HQS deficiency has been corrected. The regulation at 982.404(a)(3) states that the PHA "verifies" HQS repairs. The PHA may elect to do a reinspection to comply with 982.404(a)(3) to verify that all HQS deficiencies have been corrected. However, a reinspection is not necessary if the PHA can obtain verification through other means. For example, a PHA might accept an owner's certification that required repairs were completed and then verify that action at the next on-site inspection. Further, a PHA might tie the verification process to the severity of corrections needed and/or its experience with the owner and property. PHAs should include in the PHA‟s Administrative Plan how the PHA will verify the correction of HQS deficiencies.

In the case of initial inspections, the PHA is required to conduct a follow-up inspection if the unit does not pass HQS pursuant to the initial inspection. Additionally, in the case of project based vouchers, the PHA is required to conduct follow-up inspections to determine if the HQS deficiency is corrected pursuant to 24 CFR 983.103(e)(2).

Upgraded Electrical Outlets That Have Been Changed from Two-Pronged to Three-Pronged

In response to an HUD Office of Inspector General (OIG) audit, HUD issued this notice to clarify the "proper operating condition" of electrical outlets (110V/120V). HUD's notice is divided into two sections. A May 2008, OIG audit (www.hud.gov/offices/oig/reports/files/ig0840003.pdf) concluded that HUD did not have adequate controls to ensure that HCV program housing was in material compliance with HUD's Housing Quality Standards (HQS). The first section of HUD's notice lists the program requirements that apply to Housing Quality Standards (HQS) and supplementary guidance that PHAs and inspectors may rely upon when conducting inspections. The second section deals with the issue of electrical receptacles. Specifically, "Upgraded" electrical outlets that have been changed from two-pronged to three-pronged are the major area of concern in HUD's notice.

"Upgraded" Outlets:  In the case of older homes, owners often replace two-pronged, ungrounded outlets with three-pronged, grounded type outlets in order to establish appropriate outlets for appliances that have cords with three-pronged plugs. However, in some cases, owners may replace two-pronged, ungrounded outlets with the three-pronged, grounded type outlets without the necessary rewiring that adds a ground wire to the newly installed, grounded type outlet.

HUD's notice states, "Three-pronged, grounded type outlets should not be substituted for ungrounded outlets unless (1) a ground wire is connected to the outlet, or (2) a Ground Fault Circuit Interrupter (GFCI) protects the outlet. Installing a new ground wire may require a licensed electrician to install a new wire to the circuit breaker box and may be prohibitively expensive. A more cost-effective method is to protect the outlet with a GFCI, which provides protection to the outlet. If the GFCI senses a difference in current flow between the hot and the neutral terminals, it shuts off the flow of current to the outlet.

An older construction house with a grounded outlet would be an indication that the unit may have undergone some upgrading. In such cases, the Department recommends testing a sample of outlets in the unit to determine if three-pronged outlets are in proper operating condition, in addition to verifying the proper operating condition of the required number of outlets per room."

Testing of Outlets to Determine Proper Operating Condition Two-pronged, Ungrounded Outlets: The traditional method of testing a two-pronged, ungrounded outlet is to plug an appliance into the outlet and verify that the appliance turns on. This simple method is acceptable for determining that the ungrounded outlet is in "proper operating condition" and meets HQS.

Three-pronged Outlets: A three-pronged outlet must meet one of the following three standards for the inspector to consider the outlet in "proper operating condition" as required by HQS: 1) the outlet is properly grounded; 2) a GFCI protects the three-pronged, ungrounded outlet; or 3) the outlet complies with the applicable state or local building or inspection code

The inspector needs to use an outlet tester to determine whether the outlet is properly grounded. There are two types of outlet testers that an inspector can use to determine a properly grounded outlet: a two-wire tester or a three-pronged tester. If the inspector determines that the outlet is not properly grounded based on the results of the outlet tester, he/she may need to conduct some additional investigation to determine if a GFCI protects the outlet. A GFCI can be located at the outlet that is being tested or upstream on the circuit of the outlet.

Date of Publication:  June 3, 2011

View the notice here