Project Based Section 8 and 811 PRA Contracts

Federal Rental Assistance Programs, Section 8 and Section 811 PRA, consist of 3 functional teams:

The Housing Management Officer collaborates with local HUD field office staff to help ensure that management practices, occupancy, physical conditions, and compliance with HUD and fair housing regulations are upheld.

The HAP Contract Officer works with Owners and Management Agents of Section 8 properties to process Initial and Subsequent Contract Renewals, annual funding renewals, budget-based rent adjustments, AAF rent adjustments and special rent adjustments.

The TRACS Data Analyst works with Project Based Section 8 Owner/Agents to approve payment of the monthly Housing Assistance Payment (HAP) Voucher. The TRACS Data Analyst reviews and approves Special Claims and Repayment Agreements as well as assists Owner/Agents on correction of TRACS errors and EIV discrepancies.

Important Updates

HUD Transition from TRACS 202D to 203A Postponed

At this time, the transition from TRACS 202D to 203A has been postponed indefinitely. We will communicate the updated timeline as soon as it's available.

Questions? Visit HUD's TRACS webpage or contact your TRACS Data Analyst.

New HUD Guidance on Minnesota Supplementary Assistance Program Special Diet Allowance

On November 30, 2020, HUD released a Memorandum regarding the treatment of benefits received through the Minnesota Supplementary Assistance Program (MSA) that are provided for “medically prescribed diets if the cost of such dietary needs cannot be met through some other maintenance benefit”. This is often referred to as a special diet allowance.

Because Minnesota makes MSA special diet allowance available specifically for the cost of state determined medical expenses, HUD has determined that the MSA special diet allowance meets the income exclusion found in HUD Handbook 4350.3 Exhibit 5-1, Income Exclusions (4):

Amounts received by the family that are specifically for, or in reimbursement of, the cost of medical expenses for any family member.

HUD instructs owners to exclude this MSA special diet benefit from income calculations and to correct any previous certifications in which this benefit was included in income. Any underpaid subsidy will be credited to the tenant.

Management Reviews

Performance Based Contract Administration (PBCA)

Minnesota Housing performs performance-based contract administration (PBCA) duties on behalf of HUD for 359 project-based Section 8 projects throughout Minnesota. The agency’s responsibilities are described in the Annual Contributions Contract (ACC) awarded by HUD. PBCA staff collaborates with local HUD field office staff to help ensure that management practices, occupancy, physical conditions, and compliance with HUD and fair housing regulations are upheld. The work of PBCA aligns with Minnesota Housing’s strategic priority to preserve federally-subsidized rental housing.

Management and Occupancy Review (MOR)

Minnesota Housing's Housing Management Officers (HMOs) annually, at a minimum, perform MORs for each property and use HUD Form 9834 to conduct the review. The role of the HMO is to detect and reduce errors in income and rent determinations, to reduce rent underpayments and/or overpayments by tenants, and to maximize HUD’s housing resources, thereby helping ensure as many households as possible participate in HUD’s housing programs.

The MOR has seven components:

On-site reviews
Section 8 program updates
A tenant file review (Addendum A)
A Fair Housing/504 Questionnaire (Addendum B)
A physical inspection – REAC follow-up and vacant units
Enterprise Income Verification (EIV) access, security and use
An exit interview

Once completed, PBCA staff sends the MOR report to the owner/management agent (owner/agent) using Minnesota Housing’s Multifamily Secure Upload Tool. PBCA staff also sends the MOR report to the HUD field office. The owner/agent has 30 days to remedy deficiencies identified in the MOR, as applicable, and will send responses via Minnesota Housing’s Multifamily Secure Upload Tool (include the name of the assigned housing management officer (HMO) and property name in the subject line). If Minnesota Housing does not receive a compliant response, PBCA staff continues to work with the owner/agent until full compliance is reached, at which point the MOR will be closed. View instructions to learn how to use the Multifamily Secure Upload Tool.

The following resources are available to further assist the owner/agent in preparing for the MOR:

Suggested Outline for Project Based Section 8 Tenant Files - This outline is recommended to help ensure maximum compliance with HUD’s tenant file review requirements.

HUD 4350.3 - HUD 4350.3 is the governing HUD Handbook for Project-based Section 8 and contains regulations and guidance on all aspects of the program. Owner/agents should refer to this handbook when making management and occupancy decisions.

Preparing for a REAC Inspection – This document offers guidance for multifamily properties that are preparing for a Real Estate Assessment Center (REAC) inspection.

Contract & Funding Renewals, Rent Adjustments

The Minnesota Housing HAP Contract team works with Owners and Management Agents of Section 8 properties to process Initial and Subsequent Contract Renewals, annual funding renewals, budget based rent adjustments, AAF rent adjustments and special rent adjustments. Contact your assigned HAP Contract Officer with questions.

Adjustment Factors and Fair Market Rents

Published Operating Cost Adjustment Factor (OCAF) - Effective February 11, 2024, 5.3% for Minnesota or 1.053 for Line N on the OCAF Worksheet. Also reference the OCAF factors archive.

Utility Allowance Factor (UAF) - Effective February 11, 2024

Current Year Fair Market Rents (FMRs) - Effective October 1, 2024

Annual Adjustment Factor (AAF) - Effective April 1, 2024

Forms and Sample Letters

Owner's One-Year Notice of Intention to Renew the HAP Contract - sample form
Owner's One-year Notice of Intention not to Renew the HAP Contract – sample form
Contract Renewal Request Form - HUD form 9624 for initial and subsequent contract renewals. (Instructions)
Mark-Up-To-Market Initial Eligibility Worksheet
Operating Cost Adjustment Factor (OCAF) Worksheet - HUD 9625 (Instructions)
Owner's Notice to Tenants of Request to Increase Rents - sample PDF fillable form
Notice to Tenants Utility Allowance Decrease Only
Distribution of Owner's Notice to Increase Rents - sample cover letter to describe how the notice to tenants was distributed.
Owner's Certification as to Compliance with Tenant Comment Procedures - sample form
Utility Allowance Analysis Certification - sample form
Utility Allowance Sample Size Chart
HUD Budget Worksheet - HUD 92547-A
Owner's Request to Increase the Monthly Reserves - HUD 9250
Owner's Certification to Reasonable Purchases and Practices - sample form
HUD Rent Schedule 92458
Attachment 5 - for for-profit owners
Owner's Letter and Checklist for Rent Comparability Study
Rent Adjustment Owners Certification Form
Request for HAP Contract Greater than 5 years - for owners who wish to request a HAP contract greater than five years.
AAF Worksheets
- HUD 92273-A
- HUD 92273-B
- HUD 92273-C
- HUD 92273-D
- HUD 92273-E

Handbooks and Notices

HUD's Section 8 Renewal Guidebook
HUD Handbook 4350.1 REV-1, Chapter 7 – Budget Based Rent Increase processing guidance
HUD Notice H-2015-04 - Methodology for Completing a Multifamily Housing Utility Analysis
Annual Adjustment Factor (AAF) Notice – H2002-10

TRACS/Vouchers

The Minnesota Housing TRACS Data Analyst works with Project Based Section 8 Owner/Agents to approve payment of the monthly Housing Assistance Payment (HAP) Voucher. The TRACS Data Analyst role is to verify current accurate assistance is being paid on the monthly HAP Voucher, in order to maximize HUD’s housing resources, assuring maximum participation in HUD’s housing programs by as many eligible families as possible.

Owner/Agents submit tenant certification and HAP Voucher data via iMAX by the 10^th of each month. Upon receipt of correct, error free TRACS files, the TRACS Data Analyst approves the monthly HAP voucher for submission to HUD with payment made on the first of the following month.

The review and approval includes the following:

TRACS submissions and responses
Helping Owners/Agents with TRACS error corrections
Repayment agreements
EIV Non-Income Discrepancies

Special Claims

Special Claims in the Multifamily Portal

Special Claims in the Multifamily Portal:

Section 8 and Section 811 Project-based Rental Assistance owners and management agents submit Special Claims packets to Minnesota Housing in the Multifamily Customer Portal (Portal). The Portal allows users to submit special claims packets and all supporting documentation electronically, check on the status of submitted claims, and view upcoming deadlines.

Multifamily Customer Portal - Log in to the Portal if you have an account. Don't have an account? Learn how to get access to the Portal.
Special Claims User Guide - Step-by-step instructions for submitting and managing Special Claims.
Special Claims in the Portal Tutorial - Video training with step-by-step instructions for submitting and managing Special Claims.
TRACS Voucher Information Sheet - Form used to notify TRACS Analyst of changes in contact information for Special Claims. Submit one form per property. Changes to the Owner or Management Company for a property must be submitted separately. See the Request for Action page for details.

Guidance and Training

Helpful Hints for Special Claims – Provides guidance on steps necessary for completion and submission of Special Claims
HUD's Special Claims Guide
Special Claims Training - an in-depth training presentation containing information for accurately completing your claims
Special Claims Damages Life Expectancy - For special claims damages, the life expectancy of items such as carpets, appliances, window shades and screens as well as descriptions of “normal wear and tear”

Resources

Regular Vacancies Special Claims Checklist - Required checklist to be used with each vacancy special claim. (fillable pdf)
Sample Waiting List - can be downloaded and utilized at the site level for waiting list requirements
Unit Reconditioning Log – Sample of a required form for all special claims submissions. (fillable pdf)
Unpaid Rent Special Claims Checklist - Required checklist to be used with each unpaid rent / damages special claim. (fillable pdf)

General Resources

Guidance on Implementing Gross Rent and Utility Allowance Changes - Guidance on when gross rent changes should be implemented.
How to Submit a Repayment Agreement on a HAP Voucher - A step by step guide for owners and agents to follow when processing a repayment agreement on a voucher.
Sample Repayment Agreement - A sample form reflecting all HUD required language to be included on repayment agreements.
Unit Status Update - Form used to notify your TRACS Data Analyst of changes listed on the form, such as, Market Rate tenant move out or unit no longer a Section 8 unit and it to be used in conjunction with a TRACS file submission as required.
TRACS Voucher Information Sheet - Form used to notify TRACS Analyst of changes in contact information including email address for HAP Vouchers