Housing Voucher Programs - Policy and Procedures Manual

Chapter XX Sections

1. HUD/MSHDA Responsibilities
2. Family Eligibility
3. Issuance of Enhanced Voucher
4. Unit Size
5. Enhanced Voucher Payment Standard/Rent Reasonableness
6. Minimum Rent Requirement
7. Calculating HAP Payments
8. Re-examination Process
9. Rent Increases
10. Miscellaneous Program Requirements
11. Special Conditions after the First Year of Assistance
12. Elite and File Procedures
13. Special Administrative Fee Reporting
14. Definitions
15. Applicable Forms List

Chapter XX: Enhanced Subsidies For Housing Voucher Conversion Actions

Section I: Rent Increases

Rent Increases and the Owner:

In preservation properties, an owner may increase the rent 60 days after the effective date of the prepayment/termination.

In opt-out properties, an owner may increase the rent at the conversion date after the development-based HAP contract expires or is terminated.

The prepayment/termination of mortgage insurance does not terminate or modify the terms and conditions of the existing leases between the owner and residents of the development.

• An owner may only legally increase the rent or terminate the lease as provided under the terms of the lease and in accordance with state and local law or execute a Mutual Lease Termination Agreement (MSHDA-96). For example, if an eligible family moved into the development six months ago and the lease does not allow for rent increases for 12 months, we could delay the offering of an enhanced voucher to coincide with expiration of 12-month lease. This is the only instance where the offering of an enhanced voucher can be delayed.

Rent Increases and MSHDA:

Once the family contacts MSHDA regarding a rent increase, MSHDA must:

• Determine if the family will pay more than 30% of adjusted monthly income for gross rent when the owner's rent increase takes effect.
• If the family will not pay more than 30% of adjusted monthly income for gross rent after the rent increase, the family is not eligible to receive the enhanced subsidy. This applies even if the family has met the income requirement. If a family is denied for this reason, the applicant’s file should be kept for three years. If the family’s circumstances change and they become income eligible and are still in the same unit within three years of the initial offering, they are then allowed to be assisted on the program with a regular HCV. Return all in-eligible tenant files to the HCAC.
• Families who are ineligible for an enhanced subsidy must receive a MSHDA 1634b denial.