COVID-19 INTERIM RESPONSE Q&A
In response to COVID-19, the National Council of State Housing Agencies (NCSHA) has compiled a list of recommendations for the IRS and Congress to adopt regarding the LIHTC program and administration.
Through the below set of questions and answers, the Housing Finance & Development Division seeks to provide extensions to internal deadlines, while managing federal requirements until guidance is received by the IRS and Congress.
Q. Social Security is telling us that they will not mail out or fax benefit letters due to COVID-19. We have elderly residents that do not have internet access/or are comfortable setting up an online account. Can we use the most recent SSI statement or the previous to calculate income?
A. The award letter residents received in 2019 stating 2020 benefits can be utilized for certifications effective in 2020.
Q. Do we count the unemployment benefit for 12 months or should it be based on a resident returning to work within a couple of months (does this timing have to be clarified by the employer)?
A. Owners are expected to make reasonable judgments regarding the most reliable method for annualizing household income. Furthermore, the unemployment letter issued from the Dept of Labor should be used to verify the number of weeks a resident will receive unemployment. Also, your unemployment affidavit should address if and when a resident is expected to return to work if his or her employer is not available to verify. Please continue to use existing standards established in the 8823 Guideline and the HUD 4350.3 until additional federal guidance is released.
Q. Are residents allowed to self-certify a return to work date or income if the employer has closed due to COVID-19?
A. Unemployed residents should be allowed to submit an unemployment affidavit to verify current household income and expected return to work date when other reliable methods are not able to be obtained. Please continue to use existing standards established in the 8823 Guideline and the HUD 4350.3 until additional federal guidance is released.
Q. Should we verify/count any income from their employment prior to COVID-19?
A. Anticipated income for the next 12 months should be calculated using existing program standards until additional federal guidance is released.
Q: Are we allowed to pass on service fees to residents for online rent payments?
A: Property owners and management companies may pass on service fees to residents for online rent payments, only if residents have other ways to pay rent, such as mail or drop box. If the only option to pay rent is online and the resident is required to pay an online service fee, the online service fee is considered a mandatory cost, which must be deducted from gross rent. If the mandatory fee is not deducted from gross rent, the property is at risk of overcharging tenant rent, which is grounds for an immediate 8823, for which there is no cure.
Furthermore, DCA expects:
- Owners and property management companies to be as flexible as possible when determining rent collection methods, which means consideration for rent payment options that neither place an undue financial burden on residents nor put them in harm’s way.
- The service fee is passed through to the resident; there is no mark-up or profit on top of the assessed fee.
Q: Has HUD or DCA issued any guidance for Residents who find themselves unemployed and unable to pay rent?
A: Update! The Cares Act provides for the following two types of eviction moratoria:
- It halts evictions of renters living in single-family and multifamily properties with federally backed mortgages for 120 days after its enactment, regardless of whether the landlord receives forbearance.
- It halts evictions of renters from federally backed multifamily properties whose landlords receive forbearance, effective for the duration of the forbearance, which is capped at 90 days.
Moratorium on Evictions
For 120 days from March 25, 2020, Owners of HUD-financed properties or properties under which the Violence Against Women Act (VAWA) applies may not evict a tenant for non-payment of rent. Although VAWA is a HUD-based program requirement, DCA adopted and implemented VAWA portfolio wide several years ago. This is also referenced in our Compliance Manual (pg. 25), which stipulates that VAWA applies to all LIHTC properties. As such, the eviction moratorium applies to all of our multi-family portfolio.
Q: How should we calculate the additional unemployment income of $600/week included in the stimulus package signed on Friday?
A: (UPDATE) Counsel for HUD are currently drafting a clarification statement in response to this question, as HUD has provided contradictory guidance regarding the treatment of the $600.00 additional unemployment benefit.. DCA will update this response upon receiving clarification from HUD. Please check back to this question for an update.
Q: Do you know if the agency is accepting electronic signatures at this time on the move-in pre-qualification paperwork due to the Corona Virus.
A: Yes, please see DCA’s Electronic Signature Policy for additional guidance.
Q: What are some resources to help Georgia residents during COVID-19 restrictions?
Q: Does DCA have any insight into how the State Government will consider LIHTC housing professionals, specifically if they are going to be considered essential service personnel?
A: DCA’s LIHTC partners (owners, management companies, etc) should consider national, state and local guidance to determine the definition of essential services. DCA considers the health and safety of residents to be of the utmost importance. While urgent and emergency repairs are unavoidable, staff should practice safety precautions and have access to protective wear and equipment.
Q: What is the latest update on construction and inspection activities impacted by the shelter in place order for the City of Atlanta?
A: City of Atlanta Announcement -- Construction May Continue and 3rd Party Inspections Acceptable:
- Tim Keane, Commissioner of the Atlanta Department of City Planning, issued an update on March 24 related to construction and inspections within Atlanta city limits.
Statement from the Department of City Planning
March 24, 2020
In the City of Atlanta, construction is one of the essential businesses exempt from the Mayor’s “Stay at Home” Executive Order of March 23, 2020. Therefore, construction within the corporate city limits may continue.
In response to Governor Kemp’s March 20, 2020 Executive Order entitled Reducing Regulations to Assist the State’s Response to the Spread of COVID-19, the City of Atlanta is accepting private, third-party inspections. Submittal of such inspections can be sent to firstname.lastname@example.org. Please enter “3rd Party Inspection Request” in the subject line for immediate attention.
The City of Atlanta has the right to review these submittals in accordance with applicable regulatory requirements and determine whether the inspection report is complete and/or if the inspection itself is adequate. The City will respond regarding its review within the time frame set out by state law. This practice will be in effect as prescribed by the Governor’s order.
Q: Has there been any change to mail services at DCA?
A: Staff in the Housing Finance & Development Division and Historic Preservation Division are currently teleworking. Limited staff are in office to maintain daily functions. If packages are mailed to either office, please do not request a receipt signature so that in-person contact during mail delivery is limited.
Q: During this uncertain time, can we utilize a one-page lease renewal form, instead of signing a whole new lease with our tenant?
A: The one-page lease renewal would be acceptable it if refers back to the original lease agreements and addendums and does not require the tenant to waive rights from the original lease. Lease renewals must also capture regulatory requirements such as The Violence Against Women’s Act (VAWA).
Q: Is DCA willing to provide the software, or should my company add/upload the document into the systems that is in place for application processing?
A: DCA will not provide software. Owners should use software that satisfies ESIGN Act and/or Uniform Electronic Transactions Act (UETA) requirements.
Q: As we are looking into DocuSign or some equivalent there are going to be costs associated in processing our files. Are we permitted to charge these “actual costs” to the residents?
A: Actual cost should not be charged to residents.
Q: Does the suspension of recerts for the specific time frame apply to all housing programs?
A: The suspension of recertification only applies to a 100% tax credit property.
- Under the DCA HOME program HUD is permitting electronic signature on recertification or interim recertification documents IF the owner obtains an original “wet “signatures on the recertification/interim recertification documents at a later date.
- HUD further states that tenants can also provide income documentation for the recertification process, (i.e. paystubs, SS/SSI/SSP awards, bank statements, public assistance documents, etc.) by email to the Owner/Agent at their discretion. This approach will allow owners/agents to conduct a temporary recertification using electronic versions of these documents and the owner/agent can collect the original documents from the tenant at a later date.
Also, See the link to DCA Electronic Signature Policy Electronic Signature published to the DCA website.
Q: Will DCA consider waiving late fees for mortgage payments for properties where a number of Residents are not able to pay rent or paying rent late due to unemployment?
A: DCA will publish guidance on 4/6/20. (updates above)
Q: Are you looking at offering any other waivers that you have not released that we can know about now?
A: Please continue to visit our compliance website and read our e-mail notices for any policy updates regarding COVID-19 and compliance information.
Q: What is DCA’s position if we are unable to turn and lease vacant units due to social distancing restrictions?
A: DCA will not issue findings of non-compliance for the Vacant Unit Rule until further notice.
Q: Has HUD or DCA issued any guidance for Residents who find themselves unemployed and unable to pay rent?
A: Many of the social distancing recommendations and requirements established by various counties, municipalities, and/or local governments have and will continue to significantly impact many of your residents’ ability to work and earn income.
As a result, many counties, municipalities, and/or local government agencies have issued recent directives, orders or moratoriums related to legal actions for eviction for non-payment of rent, whether already filed or not. DCA supports these efforts. Although DCA encourages compassion during this unprecedented time, DCA does not have the authority to make this a requirement.
DCA recommends all Owners and Management Companies to consult with their attorneys to ensure any current/future evictions are not in violation of any these recent changes. It is the owner’s responsibility to ensure all evictions are compliant to all applicable, legal jurisdictions.
Q: Will DCA postpone the 9% application due date?
A: Yes, the approved application due date is June 18, 2020.
Q: Will DCA consider postponing 9% applications due dates longer than 30 days?
A: DCA will continue to monitor county and city office closures around the state. Housing Finance & Development will make periodic updates, as needed, to the application due date.
Once all counties and cities are fully operational, Housing Finance & Development will provide an appropriate amount of time for the completion of applications and notice of the updated due date.
Q: Does DCA have a position on properties that have expired certifications or are unable to meet certain deadlines?
A: DCA will not issue findings of non-compliance for late or incomplete recertifications for the time frame beginning on March 1, 2020 and going forward, until further notice.
Q: When will DCA begin reviewing requests for PIS extensions? What information needs to be included with a PIS extension request?
A: Developers that can demonstrate a delay as a result of COVID-19 related delays, can submit a request for an extension. Documentation includes but is not limited to local municipality closures, notice from construction company regarding cessation of work, documented supply delays, etc.
Q: Did the following interim guideline refer to inspections only or to construction altogether? Are we allowed to continue exterior rehab work and vacant unit rehab?
A: Yes, as long as the local government has not issued a work stoppage as a result of COVID-19, exterior construction and vacant unit renovations may continue.
Q: Can we close our amenities to prevent the spread of Coronavirus?
A: During this pandemic, Management Companies and Owners have some discretion regarding the access and continued availability of amenities to their residents. Owners and Management Companies should consider the Governor’s Executive Order issued March 23, 2020, not to congregate in groups over 10 people. If warranted, restricting access to amenities except laundry facilities, may be necessary.
Q: Does DCA have the expectation for findings to be cured despite social distancing recommendations?
A: To slow down the spread of COVID-19 and to comply with social distancing requirements, DCA will allow owners to suspend work orders for non-health and safety observed during an inspection or as a result of a resident concern. Owners are expected to continue to cure health and safety findings within 24 to 72 hours depending on the level of severity. Future guidance will be given regarding the cure period for non-health and safety findings.
DCA’s Housing Finance and Development Division (HFDD) will accept and permit the use of electronic signatures provided that 1) the electronic signature software has the capability to audit or authenticate the signature, and 2) there are no existing restrictions imposed by State or Federal law. A solution such as DocuSign or Adobe software, should be utilized in the signature process to satisfy ESIGN Act and/or Uniform Electronic Transactions Act (UETA) requirements. See DCA’s Electronic Signature Policy for additional guidance.
Q: Can e-signature be used for all source documents not listed in your policy when determining household eligibility?
A: DCA strongly encourages due diligence in authenticating source documents particularly for first year move in files. It is ultimately the Owner’s responsibility to ensure compliance. Although we do understand administrative burdens due to COVID-19, we do not want to encourage Owners to risk their ability to claim credits.
Q: My property is 100% LIHTC. Will DCA consider unconditional waiver recerts for 100% tax credit properties?
A: DCA will allow waivers for 100% tax credit properties for the time frame beginning on March 1, 2020 and going forward, until further notice.
Q: Are Developers of acquisition/rehab properties allowed to suspend relocation requirements during this time frame?
A: Under review. See next week’s Q&A.