[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR880.503]

[Page 52]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL 
 
PART 880_SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM FOR NEW 
CONSTRUCTION--Table of Contents
 
             Subpart E_Housing Assistance Payments Contract
 
Sec. 880.503  Maximum annual commitment and project account.

    (a) Maximum Annual Commitment. Where HUD is the contract 
administrator, the maximum annual amount that may be committed under the 
Contract is the total of the contract rents and utility allowances for 
all assisted units in the project. Where the PHA is the contract 
administrator, the maximum annual contribution that may be contracted 
for in the ACC is the total of the contract rents and utility allowances 
for all assisted units plus an administrative fee for the PHA as 
approved by HUD.
    (b) Project Account. (1) A project account will be established and 
maintained by HUD as a specifically identified and segregated account 
for each project. The account will be established out of the amounts by 
which the maximum annual commitment exceeds the amount actually paid out 
under the Contract or ACC each year. Payments will be made from this 
account for housing assistance payments (and fees for PHA 
administration, if appropriate) when needed to cover increases in 
contract rents or decreases in tenant rents and for other cost 
specifically approved by the Secretary.
    (2) Whenever a HUD-approved estimate of required annual payments 
under the Contract or ACC for a fiscal year exceeds the maximum annual 
commitment and would cause the amount in the project account to be less 
than 40 percent of the maximum, HUD will, within a reasonable period of 
time, take such additional steps authorized by Section 8(c)(6) of the 
U.S. Housing Act of 1937, as may be necessary, to assure that payments 
under the Contract or ACC will be adequate to cover increases in 
Contract rents and decreases in tenant rents.

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