Georgia Department of Community Affairs: 2011 HOME compliance manual [2011]

Georgia Department of Community Affairs 2011 HOME Compliance Manual
There are limited changes from the 2010 HOME Manual. Always remember to visit our website for the most recent Compliance Manuals, notices and directives. The website can be found at www.tinyurl.com/dcacompliance.
To be notified of changes to the manual or website email: compliance@dca.ga.gov with "Add Me to Your Email List" in the subject line.
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Section II
HOME COMPLIANCE MANUAL
Please refer to the Introduction to Compliance Manual in the LIHTC Manual for website, training and form information.
GENERAL DCA MONITORING AND COMPLIANCE REQUIREMENTS The responsibilities of DCA as the designated monitoring agency for state allocated HOME funds is to perform desk audits, conduct site visits, review tenant files, conduct physical inspections and provide the applicant/owner with a summary report of any findings. The applicant/owner is responsible for ensuring that the property abides by the rules, regulations, and restrictions specified in the Qualified Allocation Plan, the Land Use Restriction Agreement or Covenant, the Georgia HOME Rental Housing Loan Program and Credits Compliance Manuals, the HOME regulations, the approved application and the IRC Code and regulations.
Suggested and Mandatory Compliance Forms can be found on the website at www.tinyurl.com/dcacompliance
Required Training for Owners. A representative for the owner/general partner of a funded project is required to successfully complete a compliance training seminar provided by or sponsored by DCA prior to beginning leaseup. The owner of a HOME Rental Housing Loan Program property will be required to submit the Certificate of Successful Completion. DCA now requires Owners as well as Property Management Representatives to attend this course. In the event DCA determines that a property is experiencing compliance problems, additional training may be required for Owners, Property Managers or other project representatives. Certification testing is required and certificates are awarded upon successful completion of the training. Any Owner, Development or Owner Consultant and Management Company Representatives whose property is awarded DCA HOME for Rehabilitation and that is occupied at the time of the submission of the application must attend a DCA Relocation Training Seminar no later than thirty (30) days after the awards are announced.
Important Reference Material HUD recently provided guidance to owners and managers of HOME properties in their "Compliance for HOME Rental Projects: a Guide for Property Owners". This document may be downloaded from
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
the DCA website at www.tinyurl.com/dcatraining. Published in 2009, this Guide provides invaluable information on how the program works.
A. IMPORTANT TIME PERIODS The applicant's compliance responsibilities begin with the award of the HOME Loan and will continue through the end of the Compliance Period, the Period of Affordability, or the term of the HOME Loan, whichever is longer. DCA is required to monitor projects for compliance with the requirements of the HOME regulations, the representations set forth in the Application, the requirements stated in the Plan, and the requirements set forth in various DCA program manuals. DCA's plan for compliance monitoring described below outlines the overall requirements, offers explanations for individual program regulations, and sets forth the requirements for properties participating in multiple programs.
B. COMPLIANCE and AFFORDABILITY PERIODS Minimum Period for DCA Rent, Income and Occupancy Restrictions. Many projects have additional rent and occupancy restrictions as a result of the DCA scoring process. These restrictions remain in effect through the "Compliance Period."
HOME Periods of Affordability. All HOME-assisted rental housing must remain affordable pursuant to certain rent and occupancy restrictions for a requisite period of time. The affordability period will begin on the date that the project is marked as "completed" in the HUD reporting system for the HOME Program. This beginning date will occur after all federal HOME funds for the activity have been expended. The affordability period will be specified in the recorded LURA.
The affordability period may be terminated under certain circumstances related to foreclosure or a transfer in lieu of foreclosure. However, certain protections are afforded existing tenants for a three year period. Also, in certain circumstances this affordability period may be revived. For example, in a foreclosure situation, where the owner of record prior to the foreclosure obtains an ownership interest in the project or property after the foreclosure is complete, the LURA may be revived. HOME assisted units carry minimum rent and occupancy restrictions for varying lengths of time, depending upon the average amount of HOME funds invested per unit. These minimum periods are as follows:
Rehabilitation or Acquisition of Existing Housing (per Unit) (Less than $15,000) 5 years ($15,000-$40,000) 10 years ($40,000 or more) 15 years
New Construction or Acquisition of New Housing 20 years
The above referenced HOME affordability periods are minimum requirements. DCA policies may require longer terms of affordability. It is generally DCA's policy that the period of affordability will be as long as the term of the HOME loan.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
C. LAND USE RESTRICTION AGREEMENT (LURA) DCA enforces income, rent and occupancy requirements and agreement through covenants running with the property. . For projects receiving HOME loans, the Owner is also required to execute a Land Use Restrictive Agreement for the HOME program. This document must be recorded with the local county clerk's office and is a deed restriction that carries forward to all subsequent owners of the property. When there is more than one financing source imposing land use restrictions on a project, e.g., a HOME Loan and Credits, there may be restrictions from one program that are more restrictive than similar restrictions in the other program(s). In such instances, the most restrictive requirements will apply to the project. An owner may also make additional commitments during the application phase. These commitments may include occupant restrictions, structural restrictions, additional rent and income restrictions, single-family dwelling lease to purchase or that a local public housing authority will sponsor the project. Owners must adhere to all pledges made during the application phase throughout the compliance and extended use periods.
D. RECORD KEEPING REQUIREMENTS DCA asserts the right to perform an on-site inspection of tenant records on any project receiving HOME Rental Housing Loan Program funding at any time from initial allocation, through the end of the Compliance Period, the Period of Affordability, or the term of the HOME Loan, whichever is longer. Copies of tenant records on any project receiving HOME Rental Housing Loan funds may be requested at anytime during the compliance period or period of affordability, whichever is longer.
The following are the records that must be kept for each program:
HOME Record Keeping ( CFR 92.508) Owners must establish and maintain sufficient records to enable DCA to determine whether the HOME requirements for each project have been met. The owner must keep both project and tenant records. Records must be maintained for various periods depending on the nature of the documents. In compliance with state and local laws regarding privacy and confidentiality, records must also be available for review by HUD, the Comptroller General, DCA and other interested parties. When applicable, the owner must keep records including but not limited to the following:
Documentation to back up rent and utility allowance calculations. If the project's HOME assisted units are "floating" the owner should also keep records to show how HOME occupancy targets were met. Each tenants application, initial income verification documents, subsequent income re-certification documents and the tenant's lease A full description of each project assisted with HOME funds, including the location, form of HOME assistance and the units or tenants assisted with HOME funds The source and application of funds for each project, including, supporting documentation in accordance with 24 CFR 85.20 Records demonstrating that each rental housing project meets the minimum per unit subsidy amount of 92.205(C), the maximum per unit subsidy amount of 92.250 (a) and the subsidy layering guidelines adopted in accordance with 92.250(b) Records demonstrating that each project meets the property standards of 92.251 and the lead based paint requirements of 92.355 Records demonstrating that each family is income eligible in accordance with 92.203 Records demonstrating that each tenant based rental assistance project meets the written tenant selection policies and criteria of 92.209 ( c), including the tenant preference requirements, the rent
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
reasonableness requirements of 92.209(f), the maximum subsidy provisions of 92.209(h) HQS inspection reports and calculation of the HOME subsidy. Records demonstrating that each rental housing project meets the affordability and income targeting requirements of 92.252 for the required period. Records must be kept for each family assisted. Records demonstrating that each lease for a tenant receiving tenant based rental assistance and for an assisted rental housing unit complies with the tenant and participant protections of 92.253. Records must be kept for each family. Records demonstrating that any pre-award cost charged to the HOME allocation meets the requirements of 92.212 Equal opportunity and fair Housing records Records demonstrating compliance with the affirmative marketing procedures and requirements Records demonstrating compliance with environmental review requirements Records demonstrating compliance with the requirements of 92.353 regarding displacement, relocation, and real property acquisition, including project occupancy lists identifying the name and address of all persons occupying the real property, moving into the property and completion of the project Records demonstrating compliance with the labor requirements of 92.354 including contract provisions and payroll records Records demonstrating compliance with the lead based paint requirements of 92.355 Records supporting exceptions to the conflict of interest prohibition pursuant to 92.356 Records concerning intergovernmental review, as required by 92.357
HOME Record Retention (CFR 92.508(c))For rental housing projects, records may be retained for five years after the project completion date, except that records of individual tenant income verifications, project rents and project inspections must be retained for the most recent five year period until five years after the affordability period terminates. Records covering displacements and acquisition must be retained for five years after the date by which all persons displaced from the property and all persons whose property is acquired for the project have received the final payment to which they are entitled in accordance with 92.353.
Please note that on a layered site, other programs may require tenant records be kept for a longer period of time.
Contractor Records. Projects funded with DCA HOME funds must also provide an audit of Contractors Costs for each project. HUD and the Georgia Department of Community Affairs shall have access to the Contractor's records for the project and for his/her cost certification for five years after project completion in order to conduct audits of project costs.
E. PROPERTY STANDARDS Projects that are rehabilitated or constructed with HOME funds must meet all applicable state and local codes, standards and ordinances. If no state and local codes apply, the project must meet one of the following national model codes:
International Building Code (January 1, 2000), or Minimum Property Standard at 24 CFR 200.25
DCA Property Standards. In addition, to the property standards required under the IRC and HOME regulations, the property must also meet all DCA standards including, but not limited to the
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
appropriate accessibility requirements and DCA architectural requirements. If a project only has HOME funding it will be inspected according to Standard Housing Code. If a project is layered with LIHTC funding, it will be inspected according to Uniform Physical Condition Standards (UPCS) and Standard Housing Code.
F. RENT AND INCOME REQUIREMENT Minimum Set aside Elections. For every HOME project, the Owner must covenant and agree to the following set asides:
At HOME ONLY projects the minimum set-aside is determined by the annual Qualified Allocation Plan for the appropriate year. Although HUD allows a maximum Income of 80% DCA is more restrictive and allows only a maximum of 60%.
Fixed and Floating Units. For properties with both assisted and non-assisted units, the owner/applicant must select "fixed" or "floating" units at the time of project commitment. The owner must maintain the record documenting the selection of fixed or floating units for DCA inspection.
Fixed: When HOME assisted units are "fixed" the specific units that are HOME assisted (and, therefore, subject to HOME rent and occupancy requirements) are designated and never change.
Floating: When HOME assisted units are "floating" the units that are designated as HOME assisted may change over time as long as the total number of HOME assisted units in the project remain constant. The floating designation gives the owner some flexibility in assigning units, and can help avoid stigmatizing the HOME assisted units. If the floating designation is used, the owner must ensure that the HOME assisted units remain comparable to the non-assisted units over the affordability period in terms of size, features and number of bedrooms.
Section 42 40/50 Rule Projects funded prior to the 2009 funding round that have Tax Credits and in combination with a HOME loan where the HOME loan is included in the project's eligible basis, at least 40% of the units in each building will be rent and income restricted at the 50% or less level. The DCA requirement is more restrictive than Section 42 in that these units must be rent restricted as well as occupied by tenants earning 50% of AMI or less. Check the restrictive documents and QAP from the year of funding for your site to assure that all requirements are met. Special attention should be given by an Owner of a multi-family project comprised of single family style units. In this case, generally each dwelling is considered a building; Therefore the project's rent and income limitation would apply to all units.
Projects funded in the 2009 funding round that have Tax Credits and the HOME loan is included in the projects eligible basis will not be required to place 50% income and rent restrictions on 40% of the units.
HOME Program Rents. There are two types of rents associated with the HOME Program.
Low HOME Rents - If the project consists of three or more rental units, at least 20 percent of the HOME assisted units must have rents equal to or less than the rent affordable to a household at 50 percent of area median income (AMI) or the area Fair Market Rent (FMR), which ever is less.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
Additionally, the Low income HOME units must be distributed comparably across unit sizes, types and buildings e.g. 20% of the one bedroom, two bedrooms and three bedrooms must be Low HOME units in each project.
High HOME Rents - DCA requires that the remaining HOME-assisted units have rents equal to or less than the rent affordable to a household at 60 percent of AMI or the area FMR. In determining the maximum rent that can be charged to a tenant for HOME-assisted units remember that tenant-paid utility allowances must be subtracted from both low and high HOME rents.
DCA Rent, Income and Occupancy Requirements. In an Application submitted by the Owner of a project, the Owner may make additional representations to DCA regarding rent, income and occupancy restrictions which may be more restrictive than those required by the program. These limitations may include by are not limited to:
Greater than 30%, but less than or equal to 50% of AMI and to set rents for those units Very Low Rent and Income Restrictions where the Applicant agrees to reserve a specified number
of units for occupancy by households earning annual gross incomes or below 30% of 50% of the area gross median income. Very, Very Low. Applications that propose dwelling units with rents set at the 30% rent level and reserved for occupancy by very-very low-income (those earning annual gross incomes of 30% or less of the AMI) Mixed income projects in which a specified percentage of the units are designated as market rate units which are not subject to any rent or income restrictions.
The use of Project Based Rental Assistance is not prohibited for Very Low and Very, Very Low units, but an owner cannot accept PBRA in excess of the applicable restricted rent amount for those units if points have been received for the deeper targeting. Please refer to HUD 24 CFR Part 983 for new project-based certificate regulations.
Housing Choice Vouchers (Formerly Section 8) According to HUD guidance in the "Compliance for HOME Rental Projects: a Guide for Property Owners" (page 54) "When a household receives tenant-based rental assistance (TBRA) provided by the Section 8 Program, HOME, or another funding source, the maximum allowable rent for the HOME-assisted unit cannot exceed the applicable HUD-published HOME rent limit. This means that the tenant's rental assistance payment plus the tenant's contribution towards rent cannot exceed the HUD-published High HOME rent limit for a High HOME". (Emphasis added.) (See Home Atch 1)
These additional rent and income restrictions will be referenced in the Land Use Restrictive Agreement for the project.
Minimum Period for Rent and Income Restrictions. Restrictions shall remain in effect through the "Compliance Period." HOME rents and income restrictions will be in effect for the minimum period of affordability or the term of the DCA HOME loan, whichever is longer.
Combining HOME with PBRA. Many projects that receive funding from DCA also have project based rental assistance contracts. Applicants must use care in identifying areas of both programs which can conflict so as to avoid situations where the HOME funding could be subject to recapture.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
G. DETERMINING INCOME LIMITS Owners and managers must understand how income limits are applied if they are to be successful in maintaining a project in compliance. Each year HUD publishes new income limits with an effective date. The household's total annual gross income must be at or below the applicable income limit as elected by the owner. Once HUD publishes and once HUD approves both the income limits and the Fair Market Rents (FMR) for use in the HOME program, DCA will notify via owners and managers via the compliance broadcast email list that the rates/limits are approved for use. It is the owner's responsibility to properly calculate rent and maintain rent restriction. Owners must obtain DCA approval for rent increases, and reduce rents if needed. DCA requests notification if rental rates are being reduced.
Household Income Calculation The household's total annual gross anticipated income must be calculated to determine if a household meets the applicable income limit and is income eligible for a HOME unit.
At initial Tenant certification for any HOME Rental Housing Funded Project, the household's annual gross anticipated income should be calculated in a manner consistent with the determination of annual income under Section 8 of the United States Housing Act of 1937 (HUD Handbook 4350.3), not in accordance with the determination of gross income for federal income tax liability.
DCA requires project owners to use the Section 8 definition of income for initial qualification. At re-certification, the annual adjusted income is used, if necessary. Annual adjusted income is used at the time of tenant re-certification for HOME funded properties.
Income Types (Sources) in Calculating and Validating Income.
HUD 4350 Handbook. Please refer to the most recent version of the HUD 4350 Handbook for guidance on calculating income. Please also refer to the DCA FAQ for additional guidance.
H. OVER INCOME TENANT RESTRICTIONS (Adjusted Rent and Available Unit Rule) Adjusted Rent If DCA HOME Loans are utilized in the financing of a project, additional over income restrictions shall apply. Upon re-certification of a previously eligible tenant, if it is determined that the tenant's adjusted income exceeds 80 of AMI, the tenant's rent must be increased to the lesser of: 30% of the tenant's adjusted annual income or HUD's fair market rent limitations, not to exceed limitations set by state or local laws (if any). Any exceptions to this requirement must be approved in writing by DCA.
Available Unit Rule When a household's income exceeds 60% AMI at recertification, the next available comparable unit in the same building must be rented to a qualified Low Home tenant and the rent restricted to the Low Home rent. This allows the building to maintain the proper ratio of Low HOME to High HOME units.
I. DETERMINING RENTS In determining the appropriate rent, Owner must consider the utility allowances, services provided, revisions to HUD Income limits, rent calculation methods, changes in the tenant's income, and section 8 tenants.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
Household size. In determining the household income limitation, all applicable income standards are adjusted for family size. Please refer to the HUD 4350 Handbook and the DCA FAQ for the most up to date guidance.
Non-Optional Services: Any charges for services that are not optional to low-income tenants must be included in gross rent. For example, if an owner provides meals to residents but requires the cost for this service as a condition of occupancy, the cost must be included in the calculation of gross rent for the unit or, if the property individually meters, the water any service charge for this service will be considered rent. The cost of services must be included in gross rent even if federal or state law requires that the services be offered to tenants by building owners. An example of charges that DCA does not consider optional are: appliance rental, decorating fees (charged above security deposits), and certain move-out fees. Please refer to the Compliance FAQ for additional guidance.
Supportive Services: Owners may pledge to provide various supportive services in their Application. Owners must provide pledged supportive services through the compliance period or period of affordability whichever is longer. In addition, pledged supportive services will be monitored for existence during compliance monitoring reviews. No change may be made in supportive services without the express written consent of DCA. Fees cannot be charged for supportive services that are provided to the tenants.
HOME Fair Market Rents. FMRs are generally issued in September. Income limits are generally issued very early in the following year. When both of these figures are available, HUD calculates and issues new HOME rents for the fiscal year and establishes an effective date usually 30 days later. It is never acceptable for a PJ to use the previous year's income limits and the current year's FMRs to calculate their own HOME rent. The only valid HOME rents are those issued by HUD and posted on the HOME website.
Rent Modifications: For HOME Rental Housing Loan Financed projects, DCA must review and approve the maximum monthly rents annually. The owner must obtain written DCA approval prior to instituting any rent increases. Any increase in rent for HOME-assisted units is subject to the provisions of current leases. In any event, the owners must provide tenants of those units at least 30 days written notice before implementing any rent increase. All rent increase requests must be submitted to DCA at lease 30 days prior to notice being given to the tenant. Request must also be submitted in the DCA required format. This Rental Increase Form may be found in the Compliance Mandatory Forms. Rents may never be increased during the term of the lease.
J. CALUCULATING UTILITY ALLOWANCES Tenant-Paid Utility Allowances If the cost of any utilities (other than telephone) for a residential rental unit is paid directly by the tenant(s), the gross rent for that unit includes the applicable tenantpaid utility allowance. Any changes in utility type or source must be approved by DCA Compliance. For projects submitted in 2009, Project Owners should establish utility allowances for the property as follows:
1. USDAAssisted Buildings If a building receives assistance from the USDA (formerly called the Farmer's Home Administration, or FmHA), the USDA prescribed utility allowance applies to all rent-restricted units in the building. The USDA-approved allowance applies even if the building is
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
assisted by any other program or agency. Examples of USDA assistance include assistance provided under the USDA Section 515 rural rental loan program and USDA rental assistance.
2. Buildings with USDA-Assisted Tenants. If any resident of a building receives USDA rental assistance, the USDA-approved utility allowance applies to all rent restricted units in the building. This is even the case if residents of some units receive rental assistance from the U.S. Department of Housing and Urban Development (HUD).
3. HUD-Regulated Buildings. If neither a building nor any resident in the building receives USDA assistance, and HUD annually reviews the rents and utility allowances for the property (such as for Section 8 and Section 236 projects), the HUD-prescribed utility allowance is used. This rule doesn't apply to buildings that have only FHA-insured mortgages.
4. The allowance established by the local PHA (Public Housing Agency)for the Section 8 Program in the locality where the property is located.(the local PHA must administer a Section 8 program and that allowance must be used). However, the electric allowances may be calculated as outlined in Section C below. (Many Public Housing Agencies utility allowance tables for the Section 8 Program include a deduction for "elderly". This deduction can only be used at DCA funded properties that are 100% PBRA properties and which satisfy DCA's definition of Elderly.)
If no local PHA is located in the projects jurisdiction then the owner may elect to utilize DCA's Section 8 utility allowance.
5. A written allowance established by a Utility Provider based on actual usage may also be used. This option is only available to HOME site layered with Tax Credits.
6. The Housing Credit Agency (DCA) may provide an allowance; DCA's Office of Affordable Housing is in the process of examining the cost involved in such and allowance. The regulation states that the owner of a project requesting such and allowance will be responsible for the costs associated with such allowance. DCA is making every effort to ensure that the cost is as reasonable as possible.
7. The HUD Utility Schedule Model: This model may be found at http://www.huduser.org/portal/resources/utilmodel.html.
8. An allowance calculated by an Energy Consumption Model: the property owner may retain either a properly licensed engineer or a qualified professional approved by the HCA (DCA) (with no identity of interest to the owner) to calculate an estimate using an energy and water and sewage consumption and analysis model. The model must, at a minimum consider unit size, building orientation, design and materials, mechanical systems, appliances, and characteristics of the buildings for a 12-month period. This option is only available to HOME site layered with Tax Credits.
While initially the new revisions stated sub-metering and RUBS would no longer entitle an owner to create/claim a utility allowance, the IRS clarified in 2009 that sub-metered utilities are acceptable and that a modest charge, not to exceed $5.00 per bill may be applied to defray billing cost. Please note that Ratio Utility Billing (RUBS) is not allowed at GA Tax Credit or HOME properties.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
K. VACANT UNIT RULE The owner must actively market the vacant unit, retain evidence of the marketing efforts for monitoring purposes (i.e., newspaper, flyers and signage) and the vacant unit must be suitable for occupancy. In addition, owners are required to annually certify that the project has met this requirement.
Down units are those units that are not suitable for occupancy. (Some examples of down units are those units that are missing parts of the HVAC system, missing appliances, units that are trashed, units that have infestation, unsecured units, and units with mold and/or mildew). A down unit is not suitable for occupancy and does not satisfy the vacant unit rule.
L. TRANSFER OF OWNERSHIP All changes in ownership interest or project participant structure must be reported to DCA Legal Affairs. Failure to promptly report a change could jeopardize or cause a default in the HOME Loan. Current and potential owners are reminded that early repayment of a HOME loan will not extinguish the LURA. If a transfer is approved, the previous owner must provide a completed Transfer of Ownership Interest form to DCA prior to disposition of the property.
M.ADDITIONAL COMPLIANCE Employee Units. At 100% HOME funded projects any unit designated as an employee unit must house an income eligible household. If the HOME project is less than 100% HOME funded then the employee unit may be rented/furnished as part of the market units within the project.
Compliance Monitoring Reviews To determine tenant eligibility, rental housing owners/developers will be required to verify the annual income of families living or applying to live in any HOME-assisted housing, using the income determination procedures described in 4350 HUD Handbook. In order to verify information about household income and composition, owners/manager must have tenants complete a DCA approved Release and Consent form.
In addition, DCA compliance staff will conduct periodic compliance monitoring reviews of each project funded under the state Qualified Allocation Plan. DCA will contact project staff to schedule the review at least two weeks prior to the on-site review. Prior to the site review, the owner will receive a request to submit certain information to DCA. It is the responsibility of the owner to ensure that all tenant income certifications are available and all units are accessible for physical inspection by DCA staff during the on-site review. DCA considers the failure to respond to monitoring requests or to provide access to tenant files or access to units to be major instances of non-compliance.
Annual Owner Reporting Requirements Annual HOME Certification: DCA requires that an annual owner certification report be completed and returned to DCA on or before February 28th of each year. The current Affirmative Fair Housing Marketing Plan must be sent with the Annual HOME Certification. This plan will no longer be reviewed at the time of the site visit but will be reviewed each year with the HOME Annual Owner Certification.
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
Mitas Database All owners were required to submit Mitas Data sheets to DCA by February 1, 2011. Requirements for updating the database and maintaining current status will be released in 2011 through a compliance directive posted on the website and included in the MITAS FAQ.
Quarterly reporting is no longer required.
Exceptions for Tenant Income Certifications Properties that were financed through the Farmers Home Administration (FmHA) Section 515 Program and complete the FmHA Tenant Income Certification Form 1944-8 for each household annually (with all adult household member's signatures) do not have to complete the DCA Tenant Income Certification form. Properties that receive project-based Section 8 rental assistance and complete the Form HUD50059 or HUD-50058 annually (with all adult household members' signatures and income and asset verifications no older than 90 days) do not have to complete the DCA Tenant Income Certification form.
N. INSPECTIONS Initial HOME Inspection. During the annual DCA site review, DCA staff will review tenant files to determine whether documentation is adequate and that it supports the information in the certification and compliance reports. The Owner may be required to submit additional documentation to DCA at anytime during the period of affordability. Additionally, in Projects that receive HOME funds, DCA staff and representatives will make an on site visit when the project is complete to monitor physical compliance. The following requirements are reviewed at project completion to determine that the project has met all HOME requirements: Property Standards Only eligible costs have been reimbursed Construction Management records Lien waivers from both general contractor and all subcontractors Proper data is collected to prepare women business enterprise and minority business enterprise
reports and tenant data report Relocation records (if applicable)
Frequency of inspections. DCA Compliance staff or contractors hired by DCA will inspect the property at least once during the lease up period. In addition, during the period of affordability, DCA will inspect each project on a regular basis to ensure that the project continues to meet or exceed applicable property standards. During an on site visit, DCA will usually inspect 10 to 20% percent of the HOME assisted units in a project and a minimum of one unit in every building. If compliance problems are found, additional units and records may be inspected. Frequency of inspections for HOME properties will be as follows:
1-4 Units every 3 years 5-25 Units- every 2 years 26 or more units annually
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Georgia Department of Community Affairs 2011 HOME Compliance Manual
O. ADDITIONAL MONITORING AND REPORTING Additional monitoring and/or reporting requirements may be established for those properties that DCA considers being at greater risk of performance or compliance problems. Factors contributing to risk of poor program performance or compliance violation include, but are not limited to: lack of progress in spending HOME funds, past difficulty, staff turnover, inexperienced staff, program complexity, inaccurate submissions, audit findings, failure to meet agreed upon schedules, or poor performance or compliance history.
P. Non-Compliance Procedures Approximately four to six weeks following a property inspection or review, the owner of a project will receive: A letter outlining the findings noted during the inspection or review and requesting additional clarification or documentation; or A letter which indicates that there were no reportable findings.
The owner must submit follow-up documentation within 45 days of the date of that letter. DCA reserves the right to request follow-up documentation with 24 hours for noncompliance relating to health and safety issues. The follow up documentation must address whether the non-compliance issues have been corrected, remain uncorrected or no non-compliance exists and must be submitted in DCA Required Format Response. The definitions of cure and correct are as follows:
No Non-Compliance Exists. Generally this is the most difficult response for an owner to present. This response is presented if the owner feels an error in fact or interpretation of The Code, HUD Regulations and/or QAP has occurred. DCA evaluates this response on a case by case basis.
Corrected. For files: The eligibility of the household during the time period in question has been established.
Corrected. Physical: documentation provided clearly supports that the violation is corrected.
Uncorrected For Files and Physical. No documentation has been provided, or insufficient /unacceptable documentation is received. Property remains out of compliance and the Compliance score for the upcoming round may be affected. Additionally HUD may be notified.
Questions about the "NOTICE TO CURE FILE AND PHYSICAL REVIEW FINDINGS" letter should be addressed to the auditor prior to the close of the response window. Items with insufficient or missing response will remain out of compliance. It is the responsibility of the owner to ensure a full and complete response is provided to DCA before the deadline.
Q. ACCESSIBILITY Uncorrected accessibility violations will be reported to HUD.
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