Conversion to Vouchers:
Voluntary and Mandatory Conversion of Units to
Tenant-Based Assistance
The 1996 appropriations act included a mandate that all LHAs were
to assess their inventory against a set of standards, then remove
from inventory any units that did not meet the standard. QHWRA placed
that provision in statute, and added a provision for voluntary conversion
of units to tenant based assistance. Refer to section 22 (voluntary)
and section 33 (mandatory) of the 1937 Act, QHWRA sections 533 and
537, respectively. Section 18 of the 1937 Act, demolition and disposition,
does not apply to activities under mandatory conversion.
For the voluntary conversion, the LHA must complete several analyses:
cost analysis comparing costs to tenant based assistance, a rental
market analysis, impact analysis of the conversion on the neighborhood,
and an analysis of the market value of the public housing project
both before and after the conversion. The conversion must result
in benefits to the public housing residents, and may not negatively
affect the availability of affordable housing in the community.
An agency's intention to use the voluntary conversion provision
must be described in its agency plan. The application is sent to
HUD's Special Applications Center in Chicago.
For mandatory conversion, every LHA is required to complete an
assessment of its properties that considers whether a project is
distressed (see HOPE VI for definition). The assessment must state
whether the agency cannot guarantee any reasonable solution to the
problems, and whether the estimated cost of the remaining useful
life of the project in modernization and operating funds is higher
than the cost of providing tenant-based assistance. This assessment
must be made in consultation with the residents of the development.
The assessment and implementation plan must be included in the agency's
annual plan submission to HUD.
Other program requirements include a relocation plan, identification
of funding sources for the solution, and a demolition or disposition
application (sent to the Special Applications Center in Chicago).
The secretary of HUD is enabled to remove units from inventory that
an agency neglected to identify, and can prohibit removal from inventory
any units erroneously identified by an LHA. The secretary can also
direct an agency to cease additional spending on projects that do,
or are likely to, meet the criteria for mandatory conversion.
All agencies were required to conduct a survey of their properties
for voluntary conversion not later than 2 years from October 1,
1999, the effective date of QHWRA. Agencies may undertake voluntary
reviews at any time after that date.
For more information, please contact Christine
Siksa, Policy Analyst for Housing, at 202-289-3500, ext. 252 or
by e-mail at csiksa@nahro.org.
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