[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: 24CFR884.106]

[Page 115-116]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL 
 
PART 884--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM, NEW CONSTRUCTION SET-ASIDE FOR SECTION 515 RURAL RENTAL HOUSING PROJECTS--Table of Contents
 
           Subpart A--Applicability, Scope and Basic Policies
 
Sec. 884.106  Housing assistance payments to owners.

    (a) General. Housing Assistance Payments shall be paid to Owners for 
units under lease by eligible families, in accordance with the Contract 
and as provided in this section. These Housing Assistance Payments will 
cover the difference between the Contract Rent and the Tenant Rent. 
Where applicable, the Utility Reimbursement will be paid to the Family 
as an additional Housing Assistance Payment. The Contract will provide 
that the Owner will make this payment on behalf of the contract 
administrator. Funds will be paid to the Owner in trust solely for the 
purpose of making this additional payment. If the Family and the utility 
company consent, the Owner may pay the utility reimbursement jointly to 
the Family and the utility company or directly to the utility company. 
No Section 8 assistance may be provided for any unit occupied by an 
Owner; however, cooperatives are considered rental housing, rather than 
Owner-occupied housing, for this purpose.
    (b) Vacancies during rent-up. If a Contract Unit is not leased as of 
the effective date of the Contract, the Owner shall be entitled to 
housing assistance payments in the amount of 80 percent of the Contract 
Rent for the unit for a vacancy period not exceeding 60 days from the 
effective date of the Contract, in accordance with the procedure set 
forth in Sec. 884.213(b): Provided, That the Owner: (1) Commenced 
marketing and otherwise complied with Sec. 884.211(e), (2) has taken and 
continues to take all feasible actions to fill the vacancy, including, 
but not limited to, contacting applicants on his waiting list, if any, 
requesting the PHA and other appropriate sources to refer eligible 
applicants, and advertising the availability of the unit, and (3) has 
not rejected any eligible applicant, except for good cause acceptable to 
HUD or the PHA, as the case may be.
    (c) Vacancies after rent-up. (1) If an Eligible Family vacates its 
unit (other than as a result of action by the Owner which is in 
violation of the Lease or the Contract or any applicable law), the Owner 
shall receive housing assistance payments in the amount of 80 percent of 
the Contract Rent for a vacancy period not exceeding 60 days; provided, 
however, That if the Owner collects any of the Family's share of the 
rent for this period in an amount which, when added to the 80 percent 
payments, results in more than the Contract Rent, such excess shall be 
payable to HUD or as HUD may direct. (See also Sec. 884.115). The Owner 
shall not be entitled to any payment under this paragraph (c)(1) unless 
he: (i) Immediately upon learning of the vacancy, has notified HUD or 
the PHA, as the case may be, of the vacancy or prospective vacancy and 
the reasons for the vacancy, and (ii) has taken and continues to take 
the actions specified in paragraphs (b) (2) and (3) of this section.
    (2) If the Owner evicts an Eligible Family, he shall not be entitled 
to any payment under paragraph (c)(1) of this section unless the request 
for such payment is supported by a certification that: (i) He gave such 
Family a written notice of the proposed eviction, stating

[[Page 116]]

the grounds and advising the Family that it had 10 days within which to 
present its objections to the Owner in writing or in person and (ii) the 
proposed eviction was not in violation of the Lease or the Contract or 
any applicable law.
    (d) Debt-service vacancy payments. (1) If a unit continues to be 
vacant after the 60-day period specified in paragraph (b) or (c) of this 
section, the owner may submit a claim to receive additional housing 
assistance payments on a semiannual basis with respect to the vacant 
unit in an amount equal to the principal and interest payments required 
to amortize the portion of the debt attributable to that unit for the 
period of the vacancy, whether the vacancy commenced during rent-up or 
after rent-up.
    (2) Additional payments under this paragraph (d) for any unit shall 
not be for more than 12 months for any vacancy period, and shall be made 
only if:
    (i) The unit was in decent, safe and sanitary condition during the 
vacancy period for which payments are claimed.
    (ii) The Owner has taken and is continuing to take the actions 
specified in paragraphs (b) (1), (2) and (3) or paragraphs (c)(1) (i) 
and (ii) and (c)(2) of this section, as appropriate.
    (iii) The owner has demonstrated, in connection with the semiannual 
claim on a form and in accordance wih the standards prescribed by HUD 
with respect to the period of the vacancy, that the project is not 
providing the owner with revenues at least equal to the project costs 
incurred by the owner and that the amount of the payments requested is 
not in excess of the amount needed to make up the deficiency.
    (iv) The owner has submitted to HUD or the PHA, as appropriate, in 
connection with the semiannual claim, a statement with relevant 
supporting evidence that there is a reasonable prospect that the project 
can achieve financial soundness within a reasonable time. The statement 
shall indicate the causes of the deficiency; the corrective steps that 
have been and will be taken; and the time by which it is expected that 
the project revenues will at least equal project costs without the 
additional payments provided under this paragraph.
    (3) HUD or the PHA, as appropriate, may deny any claim for 
additional payments or suspend or terminate payments if it determines 
that, based on the owner's statement and other evidence, there is not a 
reasonable prospect that the project can achieve financial soundness 
within a reasonable time.
    (e) Prohibition of double compensation for vacancies. The Owner 
shall not be entitled to housing assistance payments with respect to 
vacant units under this section to the extent he is entitled to payments 
from other sources (for example, payments for losses of rental income 
incurred for holding units vacant for relocatees pursuant to Title I of 
the HCD Act or payments under Sec. 884.115).

[41 FR 47168, Oct. 27, 1976, as amended at 42 FR 12983, Mar. 7, 1977; 43 
FR 33880, Aug. 1, 1978. Redesignated at 45 FR 6909, Jan. 30, 1980; 49 FR 
19947, May 10, 1984]