Monday, May 22, 2017

Owners Guide

Owner’s Guide to the Section 8 Housing Choice Voucher Program 

The Section 8 Housing Choice Voucher Program

Section 8 is a rental subsidy program for low-income families funded by the Department of Housing and Urban Development (HUD). Eligibility for Section 8 is determined by income. Qualified tenants pay a percentage of their income toward their rent and utilities. The Housing Authority pays the difference between that amount and what the owner charges for rent—up to a market rate—directly to the owner.

Low-income families apply for assistance at their local Housing Authority. Because the demand for vouchers exceeds the supply, applicants are put on a waiting list. When an applicant’s name comes up on the waiting list, Housing Authority staff determines the family’s eligibility status by verifying their income. To receive assistance, families must be at or below 50% of the Area Median Income. Applicants will be denied if it is found that they have violent and/or drug related criminal activity within the past three years, or have outstanding debts to the Housing Authority.

Eligible families are offered a Section 8 Voucher and have 60 days to find a rental unit. Families with vouchers will contact owners to ask about available rentals. This is the point that begins owner participation with the Section 8 program.

The Role of Property Owners

Because tenants receiving Section 8 assistance find housing in the private rental market, the program relies upon owner participation. Owners who rent to tenants with Section 8 rental assistance retain their management role and have full rights to evict tenants per Colorado state law. Involvement in the program is voluntary for both property owners and tenants.

Tenant Selection

An owner’s first responsibility is to screen a perspective tenant. The Housing Authority does not screen applicants for tenant or credit worthiness. We do not do routine background checks on Section 8 applicants. Property owners are responsible for screening Section 8 tenants in the same manner as other tenants. Thorough tenant screening is the best security against problems during the tenancy.

Request For Tenancy Approval

After an owner has screened and selected a tenant, he/she will need to complete a Request For Tenancy Approval. The family will provide this form, which is given to them when they receive their voucher. The Request For Tenancy Approval provides information such as the rent of the unit and how the utilities will be handled. The owner decides which utilities will be provided, and which will be the responsibility of the tenant. The Request For Tenancy Approval indicates the owner’s intention to rent to the assisted family. It does not obligate either the owner or the tenant to sign a lease agreement. Once the Request For Tenancy Approval is completed, it must be returned to the Housing Authority office. Housing staff will then contact the owner to schedule an inspection of the rental unit.
Rent and Deposit

Owners may collect a market-rate security deposit. The Housing Authority does not subsidize deposits. It is the tenant’s responsibility to pay the deposit required by the owner.

Based on the information provided by the owner in the Request For Tenancy Approval, Housing Authority staff will compare the rent of the assisted unit to rents of non-assisted  properties in like neighborhoods. HUD requires all housing authorities to review the rent through a comparison process that takes into consideration factors such as size, quality, location, age, amenities, and any utilities the owner provides. This process is called comparability and is designed to ensure that property owners receive fair market rents.

Assisted tenants are required to pay a minimum of 30%, but not more than 40%, of their monthly income toward the cost of their rent and any utilities in their name. Housing Authority staff will then compute the Total Tenant Payment to verify that the family’s portion of the rent will fall within HUD’s guidelines.

The Housing Authority will inform the owner how much rent to collect from the tenant and will provide written notice if this amount changes. An owner must never accept a rent amount from the tenant other than what is stated on the lease or lease addendum. Accepting additional payments from the tenant is fraud on the part of the tenant and the owner. The family will lose their assistance and the chance to apply for Section 8 in the future. The owner will be terminated from participating in the program, may be required to repay the tenant, and could face civil and criminal charges.

Housing Quality Standards

The Section 8 program uses a set of guidelines, referred to as Housing Quality Standards, to insure that rental units meet minimum standards for health and safety. All units are inspected before the assisted tenancy begins.

After the Housing Authority determines the rent is reasonable, the staff will contact the owner to schedule an inspection. This involves a walk-thru of the unit by a trained inspector and usually takes under an hour. If the unit passes, the tenant may move in. If the unit fails, the owner will be required to make the necessary repairs and a re-inspection will be done when the work is completed. The contract and payments begin once the unit passes inspection and the tenant occupies the unit. The Housing Authority does not subsidize a unit that has not passed inspection, or has passed inspection but is unoccupied. If a family moves in to a unit before it is approved, they are responsible for paying 100% of the rent until the unit is approved. Also, the Housing Authority does not subsidize past-due rent owed to the owner before the family received a voucher.

The tenant pays their portion of the rent when they move in and is responsible for paying this amount to the owner each month, regardless of how small this amount may be. Owners are required to collect the rent from their Section 8 tenants just as they would other tenants.

The Lease and Contract

Once the unit has passed inspection and the rent and deposit have been agreed upon, the tenant and owner will be required to sign a year’s lease. At this point, the Housing Authority will enter into a Housing Assistance Payment (HAP) Contract with the owner and the assisted tenancy will begin. The contract will not be valid until it is reviewed and approved by a Section 8 Administrator.

The owner uses his/her own lease combined with a HUD Lease Addendum. The owner must use and enforce the same lease provisions for Section 8 and non-Section 8 tenants, and the lease must comply with state and local law.

The Housing Authority will mail the owner the first assistance payment after the unit has passed inspection and all paperwork has been returned with required signatures. Thereafter, regular monthly Housing Assistance Payments will be mailed to the owner on the first day of the month. Owners should contact the Housing Authority, not the tenant, if they have any questions about their HAP checks.

Ongoing Activities with Section 8 Assisted tenants

During the course of a Section 8 tenancy owners will manage their rental just like all other rentals. The Housing Authority will inspect the unit annually and recertify the family’s eligibility at lease once a year. In order for the Housing Authority to continue making payments, Housing Quality Standards must be maintained.

After the initial lease term an owner may increase the rent as long as the new rent is comparable to similar places in the neighborhood that have recently been leased. The owner needs to give 60 days written notice of the rent increase to the tenant and send a copy to the Housing Authority.

Ending the Tenancy

The initial term of the lease is one year. After the first year, either the owner or the tenant may terminate the tenancy in one of the following ways:

  • The tenant is required to give 30 days’ written notice to both the owner and the Housing Authority. Both owner and tenant must sign the 30-day notice.
  • If the owner does not wish to continue the tenancy after the first year, he or she must give the tenant written notice for a period of time defined by Colorado state law.
  • If the tenant violates the provisions of the lease, such as failing to pay their portion of the rent, or engaging in criminal or drug-related criminal activity, the owner may evict the family. The owner must follow the terms of the lease as well as Colorado state law when proceeding with an eviction. It is important to remember that the Housing Authority is neither the legal owner nor the owner’s agent, and therefore has no power to evict tenants.
  • If both the tenant and owner decide to end the lease before the term due to extenuating circumstances, they must form a Mutual Rescission of Lease, which will be reviewed by the Housing Authority. If approved, the tenancy will be terminated.

Housing Quality Standards:  An Overview of the Inspection

General Criteria for All Rooms Used For Living

  • The unit must be free from electrical hazards
  • All windows and doors accessible from the outside must lock
  • There must be at least one window, and all windows must be free from signs of severe deterioration or missing or broken panes
  • The ceiling and walls must be sound and free from hazardous defects
  • The unit must have a working smoke alarm on each floor

Living Room

The unit must have a living room that contains at least two working outlets and one working light fixture.

Kitchen

The unit must have a kitchen that contains:

  • At least one working electrical outlet and one working, permanently installed light fixture
  • If provided, appliances must work properly (It is acceptable to require that the tenant provide the appliances.)
  • A working sink with hot and cold running water
  • Space to store and prepare food

Bathroom

The unit must have a bathroom that contains:

  • At least one permanently installed light fixture
  • A working toilet in the unit for exclusive private use by the tenant
  • A working tub or shower with hot and cold running water in the unit
  • At least one operable window or a working vent system

General Criteria for Interior Areas

  • Interior stairs and common halls must be free from hazards to the occupant because of loose, broken or missing steps on stairways; absent or insecure railings; or inadequate lighting
  • The unit must be free from abnormally high levels of air pollution from vehicle exhaust, sewer gas, fuel gas, dust, or other pollutants
  • The unit must be free from any other hazards not specifically identified previously

Heating and Plumbing

  • The heating equipment must be capable of providing adequate heat to all rooms used for living
  • The heating unit must be free from unvented fuel burning space heaters or any other types of unsafe heating conditions
  • The unit must have adequate ventilation and cooling by means of operable windows or a working cooling system
  • The water heater must be installed in a safe manner and equipped with a pressure relief  valve that discharges 3-6 inches from the floor
  • The unit must be served by an approved public or private sanitary water supply
  • The plumbing must be free from major leaks or corrosion that causes serious and persistent levels of rust or contamination of the drinking water
  • The plumbing must be connected to an approved public or private disposal system and be free from sewer back-up

General Criteria for Exterior Areas

  • Access to the unit without having to go through another unit
  • A fire exit that is not blocked
  • Free from rats or severe infestation by mice or vermin 
  • Free from heavy accumulation of garbage or debris inside and outside
  • Adequate covered facilities for temporary storage and disposal of food wastes
  • The site and immediate neighborhood must be free from conditions which would seriously and continuously endanger the health or safety of the residents