[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: 24CFR983.254]

[Page 657]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
CHAPTER IX--OFFICE OF ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, 
               DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
 
PART 983--SECTION 8 PROJECT-BASED CERTIFICATE PROGRAM--Table of Contents
 
             Subpart F--Rent and Housing Assistance Payment
 
Sec. 983.254  Annual adjustment of rent to owner.

    (a) Owner request for adjustment and compliance with contract. At 
each annual anniversary date of the HAP contract, the HA must adjust the 
rent to owner in accordance with the following requirements:
    (1) The owner must request a rent increase (including a 
comparability study to determine the amount of such increase) by written 
notice to the HA at least 120 days before the HAP contract anniversary. 
The request must be submitted in the form and manner required by the HA.
    (2) The HA may not increase the rent at the annual anniversary 
unless:
    (i) The owner requested the increase by the 120 day deadline; and
    (ii) During the year before the contract anniversary, the owner 
complied with all requirements of the HAP contract, including compliance 
with the HQS for all contract units.
    (b) Amount of annual adjustment. (1) The adjusted rent to owner 
equals the lesser of:
    (i) The pre-adjustment rent to owner multiplied by the applicable 
Section 8 annual adjustment factor published by HUD in the Federal 
Register;
    (ii) The reasonable rent as determined by the HA in accordance with 
Sec. 983.256; or
    (iii) The rent requested by owner.
    (2) For a HAP contract under an Agreement executed on or after June 
1, 1998, the applicable factor is the published annual adjustment factor 
in effect 60 days before the HAP contract anniversary. For a HAP 
contract under an Agreement executed before June 1, 1998, the applicable 
factor is the published annual adjustment factor in effect on the 
contract anniversary date.
    (3) In making the annual adjustment, the pre-adjustment rent to 
owner does not include any previously approved special adjustments.
    (4) The rent to owner may be adjusted up or down in accordance with 
this section.
    (c) Rent adjustments for HA-owned units. For HA-owned PBC units, the 
HA must request HUD approval of the annual adjustment. The HA may not 
increase the rent at the annual anniversary until and unless HUD has 
reviewed the HA comparability study, and has approved the adjustment.
    (d) Initial rent. Except as necessary to correct errors in 
establishing the initial rent in accordance with HUD requirements, the 
adjusted rent to owner must not be less than the initial rent.

(Information collection requirements in this section have been approved 
by the Office of Management and Budget under control number 2577-0169.)