[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: 24CFR888.315]

[Page 173-174]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL 
 
PART 888--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM--FAIR MARKET RENTS AND CONTRACT RENT ANNUAL ADJUSTMENT FACTORS--Table of Contents
 
Subpart C--Retroactive Housing Assistance Payments for New Construction, 
 
Sec. 888.315  Restrictions on retroactive payments.

    (a) Restrictions on distribution of surplus cash. Retroactive 
payments for HUD-insured projects and other projects subject to 
limitations on the distribution of surplus cash will be deposited, in 
the manner of Housing Assistance Payments, into the appropriate project 
account. The payments will be subject to HUD rules and procedures (or 
rules and procedures of other agencies, as appropriate), described in 
the applicable regulations and the HAP contracts, for distribution of 
surplus cash to project owners.
    (b) Replacement reserve. Projects required by HUD regulations to 
maintain a reserve for replacement account and to adjust the annual 
payment to the account each year by the amount of

[[Page 174]]

the annual rent adjustment must deposit into the account the 
proportionate share of any retroactive payment received, in accordance 
with HUD regulations and the HAP contract.
    (c) Physical condition of HUD-insured or State-financed projects. If 
the most recent physical inspection report of a HUD-insured project, 
completed by the mortgagee, or by HUD or the Contract Administrator if a 
mortgagee inspection is not present, shows significant deficiencies that 
have not been addressed to the satisfaction of HUD by the date the 
retroactive payment is deposited into the project account, the payment 
will not be made available for surplus cash distribution until the 
deficiencies are resolved or a plan for their resolution has been 
approved by HUD.