[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR886.110]

[Page 135-136]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL
 
PART 886_SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM_SPECIAL 
ALLOCATIONS--Table of Contents
 
 Subpart A_Additional Assistance Program for Projects With HUD-Insured 
                         and HUD-Held Mortgages
 
Sec. 886.110  Contract rents.

    (a) The sum of the Contract Rents plus an Allowance for Utilities 
and Other Services shall not exceed the published Section 8 Fair Market 
Rents for Existing Housing, except that they may be exceeded by:
    (1) Up to 10 percent if the Field Office Director determines that 
special circumstances warrant such higher rents, or
    (2) By up to 20 percent where the Regional Administrator determines 
that special circumstances warrant such higher rents, and in either 
case, such higher rents meet the test of reasonableness in paragraph (c) 
of this section.
    (b) In the case of any project completed not more than six years 
prior to the application for assistance under that part, or in the case 
of units converted to Section 8 which were previously assisted under 
Section 101 of the Housing and Urban Development Act of 1965 or Section 
236(f)(2) of the National Housing Act, contract rents plus any allowance 
for utilities and other services may be as high as 75 percent of the 
published Section 8 Fair Market Rents for New Construction, which 
limitation may be increased: (1) By up to 10 percent if the Field Office 
Director determines that special circumstances warrant such higher 
rents, or (2) by up to 20 percent where the Regional Administrator 
determines that special circumstances warrant such higher rents, and in 
either case, such higher rents meet the test of reasonableness contained 
in paragraph (c) of this section. The project shall be converted using 
the current HUD approved rent level established pursuant to 24 CFR 
207.19(e)(2)(i).
    (c) In any case, HUD shall determine and so certify that the 
Contract Rents for the project do not exceed rents which are reasonable 
for the location, quality, amenities, facilities, and management and 
maintenance services in relation to the rents paid for comparable units 
in the private unassisted market, nor shall the Contract Rents

[[Page 136]]

exceed the rents charged by the Owner to unassisted Families for 
comparable units. HUD shall maintain for three years all certifications 
and relevant documentation under this paragraph (c).

[42 FR 5603, Jan. 28, 1977, as amended at 48 FR 36103, Aug. 9, 1983; 48 
FR 56949, Dec. 27, 1983]