[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR882.512]

[Page 84-85]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL 
 
PART 882--SECTION 8 MODERATE REHABILITATION PROGRAMS--Table of Contents
 
   Subpart E--Special Procedures for Moderate Rehabilitation--Program 
                        Development and Operation
 
Sec. 882.512  Reduction of number of units covered by contract.

    (a) Limitation on leasing to ineligible Families. Owners must lease 
all assisted units under Contract to Eligible Families. Leasing of 
vacant, assisted units to ineligible tenants is a violation of the 
Contract and grounds for all available legal remedies, including 
suspension or debarment from HUD programs and reduction of the number of 
units

[[Page 85]]

under the Contract, as set forth in paragraph (b) of this section. Once 
the PHA has determined that a violation exists, the PHA must notify HUD 
of its determination and the suggested remedies. At the direction of 
HUD, the PHA must take the appropriate action.
    (b) Reduction for failure to lease to Eligible Families. If, at any 
time beginning six months after the effective date of the Contract, the 
Owner fails for a period of six continuous months to have at least 90 
percent of the assisted units leased or available for leasing by 
Eligible Families (because families initially eligible have become 
ineligible), the PHA may, on at least 30 days' notice, reduce the number 
of units covered by the Contract. The PHA may reduce the number of units 
to the number of units actually leased or available for leasing by 
Eligible Families plus 10 percent (rounded up). If the Owner has only 
one unit under Contract and if one year has elapsed since the date of 
the last housing assistance payment, the Contract may be terminated with 
the consent of the Owner.
    (c) Restoration. The PHA will agree to an amendment of the Contract, 
to provide for subsequent restoration of any reduction made pursuant to 
paragraph (b) if:
    (1) The PHA determines that the restoration is justified by demand,
    (2) The Owner otherwise has a record of compliance with obligations 
under the Contract, and
    (3) Contract authority is available.