[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR983.205]

[Page 666-667]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
CHAPTER IX--OFFICE OF ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, 
 
PART 983_PROJECT-BASED VOUCHER (PBV) PROGRAM--Table of Contents
 
             Subpart E_Housing Assistance Payments Contract
 
Sec.  983.205  Term of HAP contract.

    (a) Ten-year initial term. The PHA may enter into a HAP contract 
with an owner for an initial term of up to ten years for each contract 
unit. The length of the term of the HAP contract for any contract unit 
may not be less than one year, nor more than ten years.
    (b) Extension of term. Within one year before expiration, the PHA 
may agree to extend the term of the HAP contract for an additional term 
of up to five years if the PHA determines an extension is appropriate to 
continue providing affordable housing for low-income families. 
Subsequent extensions are subject to the same limitations. Any extension 
of the term must be on

[[Page 667]]

the form and subject to the conditions prescribed by HUD at the time of 
the extension.
    (c) Termination by PHA--insufficient funding. (1) The HAP contract 
must provide that the term of the PHA's contractual commitment is 
subject to the availability of sufficient appropriated funding (budget 
authority) as determined by HUD or by the PHA in accordance with HUD 
instructions. For purposes of this section, ``sufficient funding'' means 
the availability of appropriations, and of funding under the ACC from 
such appropriations, to make full payment of housing assistance payments 
payable to the owner for any contract year in accordance with the terms 
of the HAP contract.
    (2) The availability of sufficient funding must be determined by HUD 
or by the PHA in accordance with HUD instructions. If it is determined 
that there may not be sufficient funding to continue housing assistance 
payments for all contract units and for the full term of the HAP 
contract, the PHA has the right to terminate the HAP contract by notice 
to the owner for all or any of the contract units. Such action by the 
PHA shall be implemented in accordance with HUD instructions.
    (d) Termination by owner--reduction below initial rent. The owner 
may terminate the HAP contract, upon notice to the PHA, if the amount of 
the rent to owner for any contract unit, as adjusted in accordance with 
Sec.  983.302, is reduced below the amount of the initial rent to owner 
(rent to owner at the beginning of the HAP contract term). In this case, 
the assisted families residing in the contract units will be offered 
tenant-based voucher assistance.