SECTION 1. INTRODUCTION One of the most critical elements of the Department’s mission is to ensure that the residents of HUD’s multifamily housing properties live in decent, safe, and sanitary housing without discrimination. It is a difficult task to accomplish this mission during a time of crisis, especially when the crisis was caused by a natural disaster or other emergency. However, the Office of Multifamily Housing Programs has a responsibility to ensure that the residents of HUD’s multifamily housing properties can find quality housing in emergency situations and to assist the owners of multifamily housing in restoring damaged properties to a decent, safe, and sanitary condition as soon as possible.
38-1 PURPOSE The purpose of this Chapter is to:
Provide information for multifamily housing staff tasked with providing disaster-related information to owners/agents and residents during emergency situations.
Provide a baseline disaster response protocol for field offices to service and protect HUD assets.
Provide a menu of options that are available for implementation to speed responsiveness, and address the needs of owners and residents.
The contractual relationship between HUD and the owner/agent is defined by the business agreements between the parties. The Hub’s objective in an emergency or a Presidentially Declared Disaster (PDD) is to protect HUD-insured/assisted properties, to preserve and restore financial soundness, and to assist owners in their recovery efforts so that all multifamily properties are restored as quickly and efficiently as possible with minimal disruption to the residents and the community.
This chapter applies to all HUD-insured and/or assisted properties affected by a PDD or when a Hub Director determines that an emergency exists such that the procedures incorporated as part of this chapter will provide HUD staff and the owner/resident community guidance for dealing with an emergency.
It should be noted that the declaration of a PDD or implementation of an Emergency Disaster Response does not confer any automatic waivers concerning any HUD Regulations, Policies or Procedures.
SECTION 2. PRE-DISASTER PLANNING
CONTINUITY OF OPERATION PLAN
The Field Office Director is required to maintain a Continuity of Operation Plan (COOP). The Multifamily Plan and Strategy is intended to complement that plan but is specific as to dealing with the Multifamily Housing portfolio when normal servicing procedures and guidance are not adequate. The COOP should designate a Multifamily Emergency Response Coordinator (ERC) for the Hub and form an Emergency Response Team (ERT).
The Team and the Coordinator must be identified, trained and available during an emergency. The Director of the Office of Multifamily Asset Management will be the initial contact for coordinating communication between the Hub and Headquarters.
To the extent possible, the Emergency Response Team (ERT) should consist of HUD Multifamily field office staff, external partners and customers, property owners and management agents, other HUD program offices (i.e., Community Planning and Development (CPD), Public and Indian Housing (PIH), etc.), governmental agencies and emergency response providers and the community. This Team should meet periodically to plan, prepare, and train in preparation for an emergency.
PRE-DISASTER AND EMERGENCY GOALS AND PLANNING
The main goal of pre-disaster planning is to have essential staff prepared to respond to any Multifamily Housing emergency. Pre-disaster planning involves preparing and training a Multifamily Team to respond to any type of emergency so that HUD can help mitigate the impact of the emergency. The Coordinator should be trained to access the portfolio of damaged properties and be prepared to implement the Disaster Response Plan (DRP) should a PDD be declared. The Coordinator should also be prepared to assist and advise owners, agents, and residents when there is resident displacement or any significant emergency.
Most emergencies cannot be anticipated. However, some areas of the country are more prone to emergencies than others, e.g., the Gulf States are prone to hurricane damage, the Mid-West states are prone to flooding, and some states have a history of earthquakes or tornadoes. Emergency planning in these geographical locations is imperative.
THE ROLE OF THE EMERGENCY RESPONSE TEAM
The Emergency Response Team (ERT) is responsible for coordinating the activities of the Hub in responding to an emergency.
One suggested make-up of the internal ERT is outlined below. The Hub Director can add additional staff and functions as he or she sees fit. The Hub Director will always be the chair. The team should include:
The Hub Director
The Program Center Director(s)
The ER Coordinator
A Construction Analyst
A Project Manager(s)
An Occupancy Specialist(s)
An FHEO Specialist
The Contract Administrator Oversight Monitor (CAOM)
A CPD staff person
The ERT should meet quarterly in person or by conference call to ensure that the Team is always prepared for an emergency. The quarterly drill meetings provide a good opportunity to train as well as review procedures and responsibilities.
THE EMERGENCY RESPONSE COODINATOR
The Multifamily Hub Director will designate an Emergency Response Coordinator (Coordinator). The Coordinator should be trained to access the portfolio of damaged properties and be prepared to implement the Disaster Response Plan (DRP) should a PDD be declared. The Coordinator should also be prepared to assist and advise owners, agents, and residents when there is resident displacement. This person will be responsible for functions that include, but are not limited to:
Providing the ERT and other HUD field staff with this Guidance.
Identifying the responsibilities of all ERT members.
Determining the appropriate size of the ERT. This will be dependent on the size and scope of the emergency.
Determining how staff will handle calls from persons with speech and/or hearing impairments and persons with limited English proficiency (LEP).
Developing a conceptual plan and schedule which covers tasks such as assembling the ERT quarterly/annually to review processes, procedures, forms, etc.
Assembling the ERT when there is a potential emergency.
Coordinating with Office of Multifamily Housing’s Office of Development staff to include pipeline properties.
Coordinating potential technical support responsibilities with the Construction Analyst (or designated staff person) in preparation of the on-site assessment(s) for technical assistance and the need for contractors.
Ensuring that disaster procedures are forwarded via email to the owners/agents in the affected disaster area (e.g., mass email).
Ensuring that current contact phone numbers and email addresses for all owners/agents, Housing Finance Agencies (HFAs), and industry organizations are correct and on-hand.
Communicating information to the Contract Administrator Oversight Monitor (CAOM) for properties with Performance-Based Contract Administrator (PBCA) oversight; who in-turn will communicate with the PBCA.
Performing a quarterly data quality check of the impacted properties information in the Integrated Real Estate Management System (IREMS). The information should be reviewed to identify data errors (missing property names, missing unit totals, etc.) and corrected as necessary.
Ensure that there is a plan for tracking progress on repairs, resident displacement, and any other problems that occur. This information must be entered into iREMS.
NOTE: Owners and management agents who own/manage a large number of properties may have their own emergency response plan. It is recommended that the ERT contact these owners/agents so that you can include any information that they have that may be helpful when formulating the Hub’s plan.
PREPARING FOR AN EMERGENCY
Planning and training are essential to achieving a well coordinated and implemented emergency response effort. A listing of other federal, state, local and private resources should be compiled so that it is available to address the needs of individuals and owners who are impacted by the emergency. The HUD field office should update this list to include other federal resources (FEMA, HHS, etc.), state resources, and local/private resources such as county programs, churches, faith based organizations, etc., that may be of assistance during a PDD or an emergency.
In the event of an imminent emergency, the Hub/HUD field office should be proactive and request an Affected Properties List (APL) from Headquarters based on prior knowledge or estimates of the areas that may be affected. The process will allow HUD field office staff to identify the potential inventory, eliminate duplication, and update the list as necessary. When an event such as a storm or hurricane can be predicted ahead of time, the Hub should develop a pre-disaster response strategy and compile an inventory of properties that will potentially be affected as soon as Headquarters/HUD field office staff is notified that the event is imminent.
PRE-DECLARATION REPORTS/EVENT WARNINGS
When an emergency is predicted, the Coordinator should develop a pre-emergency report for the Hub Director. The report should be updated daily and should include:
A report on staff/volunteers available for HUD, FEMA, or other organizations and the hours they can be available.
A report on locations of FEMA centers if established.
Emergency contact numbers for HUD field staff.
A list of the areas that may be affected.
The number of properties and estimated number of residents in the emergency/disaster area.
The number of displaced residents with disabilities and/or special needs who may be impacted. If possible, the report should identify the number of LEP persons I the area and the languages that they speak
Certification that all applicable information was forwarded to all owners/agents in the disaster/emergency area.
Current information regarding the emergency/disaster status (mild, severe, etc.).
A count of staff unable to work due to transportation problems, possible personal injury, property damage, etc.
DISASTER INFORMATION SCRIPT
During the pre-emergency phase, the ERT must develop an informational script. The informational script must be distributed to all HUD field staff and must be used when receiving telephone or other inquiries from disaster victims, the public, the press, etc. HUD field office staff should also have FEMA, State, local, and private resources information readily available. Points of contact for HUD’s other program areas (PIH, CPD, SF, etc.) should also be assembled.
The list should contain the following information:
FEMA Center addresses, phone numbers and website.
American Red Cross, Salvation Army, etc. phone numbers.
National Housing Locator number or web site which is http://portal.hud.gov/app_nhls/.
The Department of Agriculture’s Rural Housing Service phone number.
Are you a resident or owner/agent? Concerned citizen?
Where is your property or apartment complex located? (The property name and address)?
How severe was the damage at the affected property, neighborhood and/or roads?
Have residents (you) been displaced? If so, how many, and to where, etc.?
Do any displaced residents have special needs/disabilities that you know of?
What is your temporary phone number (obtain an alternate cell number)?
What is your email address?
Owners/agents should be provided on-going technical assistance and should be encouraged to self-report any vacancies that could be used to house displaced residents and listed in the National Housing Locator http://portal.hud.gov/app_nhls/) and the field office.
INTEGRATED REAL ESTATE MANAGEMENT SYSTEM (iREMS)
The Affected Portfolio List and Tracking Report (discussed in Section III) are developed from data in iREMS. Consequently, all iREMS data must be accurate and frequently reviewed for completeness to generate reliable tracking reports once the emergency occurs. Project Managers must be advised to keep the iREMS Problem Statement and Occupancy pages updated at all times.
Residents should be informed that if they are displaced in an emergency, they are responsible for advising the owner and/or the owner’s representative of their temporary housing location and their intentions during and after the emergency/disaster. If the displaced resident has a new, temporary address or telephone number, they should provide it to the owner or agent of the development from which they were displaced. Residents should also be advised that due to potentially dangerous conditions, they may not have ready access to their possessions. Owners are responsible for securing the property to the best of their ability immediately after the emergency, and to protect the personal property of the residents. The resident will need to contact their insurance agent (rental insurance) for any coverage on their personal property.
Disposal of any personal property must be done in accordance with local law. Additionally, owners may take action to terminate a lease and dispose of personal property in accordance with local law when displaced residents indicate their intention not to return or fails to respond to the owner’s notice.
In the event a property’s rental office has to be vacated, the owner should publish where he or she can be contacted and should regularly inform residents as to progress making repairs and when they might re-occupy their residence.
OWNER’S COMMUNICATION RESPONSIBILITY
Owners also have a responsibility to ensure that the property is secured and that residents’ possessions and valuables are secured and protected to the greatest extent possible. Residents have a right to return to the unit from which they were displaced once their residence is repaired so owners must make a concerted effort to track displaced residents by phone, mail, family, friends, by contacting FEMA, or some other method. An owner may offer, and a resident may accept, an alternate unit acceptable to all parties if that will facilitate a displaced resident’s returning to a permanent residence. However, once a resident accepts any permanent housing they no longer have a right to return to the unit from which they were displaced.
Owners must inform all displaced residents in writing at least 60 days prior to the expected date that the unit will be ready for re-occupancy. The notice must be issued via regular and certified mail to the resident’s last known address. Owners should be reminded of their duties to ensure that this information is provided in accessible formats for persons with disabilities and in the appropriate language for persons with LEP. Owners should also be reminded of their duty to make reasonable accommodations for persons with disabilities.
Displaced residents must respond within 30 days of the notice and inform the owner of their intention to return or not, and provide contact information. The response must be in writing, although the resident may also call the owner’s contact representative to indicate his or her decision and to ask any questions they may have about returning. If the resident does not respond within 30 days from the date of the notice, the owner must send a second notice notifying the resident that he or she no longer has a right of return to the unit that the resident occupied prior to the PDD. Those residents indicating an intention to return must be given a minimum of 60 days from the date the unit is ready for re-occupancy to re-occupy the unit. An owner has the option to give a displaced resident a longer period to return to the property. Once again, owners should be reminded of their duties to ensure that this information is provided in accessible formats for persons with disabilities and in the appropriate language for persons with LEP, and of their duty to make reasonable accommodations for persons with disabilities.
An owner may offer an available comparable unit to a displaced resident if the unit that the resident occupied before the PDD cannot be repaired or if the repairs require a long period of time to complete. If a returning resident accepts an alternate unit, the resident(s) is considered re-housed and not eligible for additional unit transfer except in accordance with HUD Handbook 4350.3 REV-1. If the displaced resident(s) resided in a Section 8 HAP unit and was over-or under-housed, as defined in the aforementioned handbook, prior to the PDD, an appropriate size must be offered as a replacement, if available.
If a displaced resident fails to return after notifying the owner of his or her intention to return during the right to return period and there was no agreement between the displaced resident and the owner to extend the time period, the owner may take action to terminate the lease in accordance with local law and rent the unit. In this case the resident no longer has a right to return to the unit and will be treated as a new applicant and will have no priority as a PDD displaced resident on the waiting list.
SECTION 3. THE PRESIDENTIALLY DECLARED DISASTER (PDD)
A Presidentially Declared Disaster is defined as a “major disaster or emergency declared under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, as amended (42 U.S.C. 5121 et seq.). FEMA recommends that the President declare a major disaster or emergency and coordinates all relief efforts.”
All HUD-related properties in a PDD area may not be impacted. The number of properties that require special disaster assistance due to a PDD will be in addition to normal servicing of the regular portfolio. This section will outline routine oversight and monitoring procedures that should be followed by HUD field office staff once a disaster has been declared. There are three phases of recovery activities: (1) preliminary assessment/reporting, (2) recovery, and (3) close-out/return to routine asset management servicing. This section also provides an overview of the roles and responsibilities that HUD Headquarters staff, HUD field office staff, and owners/agents, and residents, play in carrying out these three phases.
The following is a diagram that illustrates the cycle once a Disaster is declared.
Once a disaster is declared, the Emergency Response Team (ERT) should determine what procedures should be applicable for the Hub’s emergency response. Coordination with the Office of Multifamily Housing Programs in Headquarters is encouraged, but not mandatory in the absence of a PDD.
PROCEDURES - OVERVIEW
Once the President declares a disaster, HUD field offices serve as the central point for coordinating all Multifamily housing disaster activities. These procedures, which are discussed in more detail below, are in effect until the recovery plan has been completed for all affected properties. Additional geographic areas may also be added after the initial declaration.
When the President declares a federal disaster, there are steps that must be taken immediately to minimize the impact of the disaster on the property and the residents.
Assemble the assigned ERT members.
Obtain the list of properties in the PDD area from Headquarters.
Respond to phone inquiries using the informational script.
Coordinate with FEMA and other agencies.
Conduct ongoing phone surveys with owners/agents of potentially affected properties using the Preliminary Disaster Assessment (Appendix A-3).
Review Preliminary Disaster Assessment data for accuracy and completeness.
Determine the Damage Assessment Code for every property based on the Preliminary Disaster Assessment as determined by the Construction Analyst or designee (Appendix A-3).
Complete the Affected Portfolio List and Tracking Report (Appendix A-2).
Complete the Vacancy Utilization/Displaced Resident Report (Appendix A-4).
Request HUD Contract Administrator Oversight Monitors to suspend full or partial Housing Assistance Payment (HAP) contracts for units where residents will be displaced more than 30 days.
Determine if additional help is needed to adequately respond to the conditions. This may include additional staff (skills set), lap tops, cameras, transportation or other supplies.
Determine if contractor support is needed to survey, inspect, assess repairs, etc.
Prepare for regular conference calls with Headquarters.
Determine if Section 8 assistance can be temporarily transferred in a “Pass Through.” (See Section 38-30).
Note: Except for doing pre-emergency preparation and on-going surveys of damage and resident displacement, formal direction must be received from Headquarters to implement multifamily guidance. However, the Hub and/or Program Center Director may have ordered certain activities in any emergency. Also, the Hub and/or Program Center Director may ask for volunteers to assist FEMA. The offering of volunteers must be coordinated and approved by Headquarters.
PRELIMINARY ASSESSMENT AND REPORTING
Once an area is declared a federal disaster area by the President, the first step is to conduct a preliminary assessment of the potentially affected portfolio. The preliminary assessment process is initiated once the Affected Portfolio List (APL) is received by the Hub director, from Headquarters. The pre-disaster APL can augment but not replace the APL from Headquarters. The APL is the sole source used to gather information on properties. The APL will help determine resident needs, identify vacancies, develop the master list for reporting, and target damaged properties for recovery activities. The APL can be amended with Headquarter approval. Refer to Appendix A-2 for a sample of the APL.
Note: HUD field offices may not develop separate property lists. Separate lists may foster confusion and/or result in an inability to account for all properties in the affected portfolio. However, the local office may know of a property that was damaged but is not the on APL or in the PDD area. In that case, Headquarters should be advised. The Project Manager (PM) should also advise all owners to register with FEMA to determine if they qualify for assistance.
The following reporting tools are used for documenting the status of properties affected by an emergency or disaster:
The Preliminary Disaster Assessment (PDA) is the initial list of all properties that were identified as having suffered damage during the emergency or disaster. The PDA is critical in assessing the extent of disaster damage and resident displacement and is used to prioritize properties based on level of damage. Information is obtained for the PDA via telephone contact with the owner/agent and must be used for all properties on the APL. Refer to Appendix A-3 for a sample of the Preliminary Disaster Assessment for Multifamily Housing Properties. Upon completion of the Preliminary Disaster Assessment, the Hub Construction Analyst or designee will score each property with a “disaster code”, which will be used when conducting the on-going re-assessments discussed later in this section. The numerical “code” designation can change over time.
Note: The preliminary disaster assessment includes questions to determine the unmet basic needs of residents or property owners and their employees such as food, water, health risks, disability issues, life-threatening issues, etc. If unmet needs are identified, the Hub Director should coordinate with Headquarters and/or the appropriate FEMA Office, and the appropriate Federal, state, and/or local resources. Life-threatening issues should be reported to FEMA emergency personnel immediately as well as other local agencies.
Vacancy Utilization/Displaced Resident Report
The Vacancy Utilization/Displaced Resident Report is used to assess available units for displaced residents. The ERT must use this report along with the PDA when contacting owners/agents. Vacant units in pipeline properties may be utilized for temporary housing and permanent housing if the property is in the habitable stage of development. Owners/agents and local officials are encouraged to take the necessary steps to make units available (e.g., utilizing online marketing databases, realtor referral resources, registering with the State/local housing locator service, etc.). Refer to Appendix A-4 for a sample of the HUD Vacancy/Utilization Report.
Note: If it is known that (1) vacant units are not in good repair as evidenced by a recent physical inspection score below 60, (2) action is being taken to abate the Section 8 contract; or, (3) legal action is being taken to foreclose, then those units should be excluded from the report. If the ERT has been informed of non-HUD related vacancies indicate “No” in the HUD Property column on the sample “Vacancy/Utilization Report”, and forward along with the required documents to Headquarters.
Final Disaster Assessment
When possible, the Hub Construction Analyst or designee should be dispatched to conduct an on-site final assessment of the affected properties. The final disaster assessment is performed to confirm the extent of the damage reported during the PDA and to determine which properties should be inspected or re-inspected by the company contracted to do a more thorough damage assessment if a contractor is in place. The Hub Construction Analyst or designee must obtain a copy of the PDA in preparation of the on-site final assessment. During the final assessment, photographs and/or video should be taken and information on the damage should be obtained from the owner/agent and documented. The list will also include inspections for all potentially affected properties in the development pipeline. Refer to Appendix A-5 for a sample of the Final Disaster Assessment for Multifamily Housing Properties. Other entities (mortgagee, insurance companies, FEMA) may also be inspecting the properties. If available obtain copies of these inspections to assist with the analysis and recovery efforts for the property.
D. Affected Portfolio List and Tracking Report (TR)
Once all PDAs and Vacancy Utilization Reports have been completed, the Emergency Coordinator is responsible for consolidating the information into the Tracking Report (TR). The TR is the primary tool used to track information obtained from all parties and to communicate property status information to Headquarters. Refer to Appendix A-2 for a sample of the TR.
The goal is to restore operations to normal or improved operating levels after an emergency and to re-house displaced residents, as soon as possible. A successful recovery strategy begins with a final assessment of damage, followed by technical assistance to owners/agents, and ultimately resumption of normal asset management functions. Recovery from a major disaster/emergency may be protracted and can be different from project to project. Ultimately, the emergency is over when all repairs have been made, all displaced residents have returned to the apartment they were displaced from or found other permanent housing, and the property is physically and financially sound.
TECHNICAL ASSISTANCE TO OWNERS AND MANAGEMENT AGENTS
Ongoing communication and technical assistance to owners/agents will be necessary until; (1) all properties are restored to decent, safe, and sanitary condition or, (2) tall properties are declared unsafe and uninhabitable. If a property is declared unsafe and uninhabitable, resident relocation procedures must be followed in accordance with outstanding HUD policy.
38-19. USING THE FINAL DISASTER ASSESSMENT During this phase, under the direction of the ERT, HUD staff must conduct follow-up surveys using the Final Disaster Assessment to verify the information and report findings to Headquarters. The Final Disaster Assessment should be completed within 15 business days or as soon as possible depending on the severity of the PDD. This information must be documented on the TR in the appropriate columns and should notate and explain issues related to:
Confirming all damage reports;
Confirming the number of properties or the number of units at a property that will remain off-line until repaired. The owner/agent should identify unit numbers and specific residents and this information should match the data tracked on the Displaced Residents/Unmet Needs section of the Preliminary Disaster Assessment (Appendix A-3);
Verifying and documenting the Reserve for Replacement and Residual Receipts balances in HUD systems and enter the information in the DTR;
Whether or not the owner has certified that a method has been established to track displaced residents, including mode and frequency of contact, whether communications are accessible to persons with disabilities and persons with LEP, if needed;
Whether steps to be taken to update residents on the status of re-occupancy;
Monitoring the due dates for the recovery plan. Ideally the owner should submit a recovery plan within 30 business days of the final assessment; however, the extent of the damage, the timing of the insurance settlement, and/or the need for loans or grants may delay the submission of a recovery plan;
Scheduling an on-site meeting within 60 days of the final assessment to monitor recovery efforts;
Monitoring Housing Assistance Payment (HAP) contract suspensions for unoccupied or damaged units;
Coordinating the damage assessment with the HUD inspection contractor (if any); and,
Ensuring that insurance proceeds are co-endorsed and deposited appropriately (if applicable).
The Project Manager must forward a template letter to owners/managers confirming the information obtained in the final disaster assessment. This letter will also notify the owner of the due date for the recovery plan and confirm the scheduled on-site assessment to assess the status of repairs outlined in the owner/agent’s recovery plan. Refer to Appendix A-6 for the sample confirmation letter to owners/agents.
38-20. RECOVERY PLANS FOR DAMAGED PROPERTIES A viable recovery strategy is essential for every damaged property. There should be a comprehensive plan and time line for all properties and an individual plan for each property that was damaged. The comprehensive plan should be measurable, and include time frames. Each individual plan should be specific, funded, measurable, and include time frames regarding when the repair work will be completed.
The comprehensive disaster recovery plan should include measures to:
Protect residents from displacement and mitigate health and safety concerns;
Ensure that displaced residents’ property is secure and protected;
Ensure that displaced residents are returned to their apartments as rapidly as possible;
Protect HUD’s assets;
Ensure ongoing management operations while reducing disruption; and,
Provide key personnel contacts;
Time lines are critical in developing the recovery plan. The owner/agent should strive to:
Minimize the impact on residents, especially where displacement occurs;
Minimize the disruption to management operations;
Facilitate effective coordination of recovery tasks with contractors;
Maintain communication and cooperation with HUD staff and displaced residents;
Provide for security where necessary;
Make timely debt service and vendor payments or seek forbearance.
Identify sources of funds such as reserve for replacement funds, insurance funds, grants, loans, etc.
THE COMPONENTS OF A RECOVERY PLAN
The recovery plan must be submitted within 30 business days of the final disaster assessment. The following are the key components that must be documented in an acceptable recovery plan. Additional information may be required depending on the type and extent of the emergency:
Primary Contact Information (Owner and Management Agent, etc).
Summary of Damage and Impact Analysis.
Recovery Strategy (proposal for restoring the property to normal condition).
Contractor Award Information (Including supporting documentation that the award meets HUD’s procurement requirements). If normal procurement practices are impractical and the owner cannot advertise or collect bids, then he/she must justify the method used and the CPA must certify costs in the next yearly audit.
Tentative completion dates for major systems.
Overall completion date for all damaged items.
Process for coordinating temporary resident relocation and return plan of the tenants.
An accounting of all escrows, information regarding any loan applications, and information regarding insurance claims.
Information on any shortfalls in the funds needed to make repairs and the owner’s plan stating how they will make up any shortfall in the funds to fully restore the property to its pre-disaster condition.
Process for bringing units back on-line and moving residents to vacant units if repairs will be made while residents are in place including a plan for how the owner plans to meet the needs of persons with disabilities or LEP during the temporary relocation and return of residents to their units.
A plan and procedures for tracking and contacting displaced residents including residents with disabilities or LEP.
Additionally, the following items must be submitted with the recovery plan:
Summary of contractor’s experience.
Copies of bids.
Licensing and bonding documentation.
MONITORING AND EVALUATING RECOVERY PLANS
The Project Manager will evaluate recovery plans (using inspection reports, monthly accounting reports, etc.) for reasonableness. This evaluation should be performed in coordination with a HUD Construction Analyst or designee assigned to perform the on-site disaster assessments. Properties that have significant damage and resident displacement should be designated as “Troubled” and monthly accounting reports should be required for insured and Secretary-held loans.
Once the recovery plan is approved, the Project Manager will:
Monitor the disposition of insurance funds, loans, grants, etc., and releases from Reserve for Replacement and Residual Receipts accounts;
Provide Asset Development staff with damage assessment information relating to pipeline properties;
Prepare waivers, suspension reports, forbearance requests, etc. if necessary;
Resume routine physical inspections, Management and occupancy Reviews (MORs), etc., if they were suspended;
Continue appropriate servicing as dictated by the Plan; and
Ensure iREMS is updated continually in the Problem Statement.
Once the recovery plans have been completed, final inspections have been conducted, and residents have returned to their units, the ERT will update the APL to note that the property may return to normal asset management servicing.
MONITORING AND EVALUATING RECOVERY PLANS
As part of the close-out phase, the ERC, and any staff working with the ERC, should complete the checklist (Appendix A-7) as evidence that HUD has verified that all items noted in the owner’s recovery plan have been completed. The completed checklist should be maintained with the approved disaster recovery plan in the project file for each affected project. Comments/concerns requiring additional actions and recommendations by the owner should be addressed. This action is not mandatory but can be a good tool for historical purposes.
EMERGENCY RESPONSE TEAM CLOSEOUT
Following a disaster, the ERC should assemble all HUD field office staff to obtain input, recommendations and suggestions, to be better prepared for future events by amending the Hub Disaster/Emergency response plan. A formal evaluation of the Response Plan can be helpful for the future. Recommendations based on “lessons learned” should be forwarded to Headquarters.
SECTION 4. PROGRAM AND DISASTER RELIEF OPTIONS DURING A PDD
These “options” are available in an emergency if authorized by the Hub Director unless otherwise stated for PDDs.
The Department relies upon FEMA’s eligibility determination. Those impacted by the disaster (i.e. owners and residents) must make an application with FEMA, receive an application number, and obtain a letter of eligibility, which specifically describes the type of eligibility. Those impacted by a disaster will not be afforded relief or assistance as a result of a Presidential Declared Disaster unless they have been certified by FEMA as being eligible. However, residents displaced by a PDD have a right of return regardless of whether they registered with FEMA or not. Owners must register with FEMA as financial assistance grants, loans and other federal assistance may be made available. Usually once declared, applicants for individual assistance only have sixty days to apply.
WAIVERS OF HANDBOOKS, NOTICES, ETC.
Hub Directors should process requests for waivers of provisions of the Office of Housing Handbooks and Notices that do not reflect statutory or regulatory requirements, as quickly as possible. Hub Directors should justify each waiver request by preparing a Finding and Determination and forwarding it to Headquarters for review and approval by the Director of the Office of Asset Management. Upon approval by Headquarters, the Project manger must place a copy of the justification in the project file. The Integrated Real Estate Management System (iREMS - Problem Statement Screen) must be updated when a waiver is requested, granted or denied (such as using R for R for security, or relocation etc.). This is to ensure uniformity where the impacted area is widespread.
PRIORITY FOR TEMPORARY AND PERMANENT RENTAL HOUSING
Displaced residents may be moved to the top of the waiting list in Section 221(d) and 236 projects for temporary or permanent rental housing as long as the residents are displaced and are FEMA certified as disaster victims. This preference is only available after a Disaster has been declared by the President.
Federal statue and HUD regulations require that PDD displaced residents be given priority over other applicants for either temporary or permanent housing in all multifamily properties currently insured under sections 221(d)(3), 221(d)(4) and 221(d)(3) BMIR and 236 programs (See HUD handbook 4350.3 REV-1, chapter 4, paragraph 4-6). The term of this requirement is for 18 months from FEMA’s publication of the PDD declaration, unless extended by Congress. The PDD displaced resident is required to provide their FEMA certification to qualify for priority on the waiting list and must also be eligible for the unit (cannot be over or under housed). An owner should maintain the same waiting list preferences that were in place prior to the PDD except for the preference priority for the 18-month period referenced above. This is a one-time preference per PDD.
When a displaced resident secures temporary housing using this preference rule and they decide to remain in the unit and not return to the unit which they occupied at the time of the disaster they are considered permanently housed. They lose their right to return to the unit they occupied at the time of the disaster when it is repaired, and they are no longer afforded any preference.
MULTIPLE OCCUPANTS IN A UNIT
The Department will allow multiple occupants who were displaced to live in the same apartment unit provided it does not create a health and safety problem. Only FEMA-certified displaced residents can move in with families and friends occupying HUD-assisted units on a temporary basis, provided that the host household obtains the project owner’s approval.
In the case of a project based Section 8 Housing Assistance Payments (HAP) assisted unit, if a current, eligible family chooses to allow a non-eligible, but FEMA-certified individual/family to move into the unit on a short-term basis, the non-eligible family is considered a guest. A multifamily project owner may allow the eligible family to house the guest(s) for a limited period (e.g., 90 days) without interruption of the subsidy. Residence by the eligible family is the predicate for continuation of the Section 8 subsidy. As a condition of approval the “guest” must endorse a lease addendum (see Appendix A-9). Should the eligible family move out, the “guest” must vacate also.
LEASES AND RENTS FOR NON-PERMANENT RESIDENTS
Owners with displaced persons to be housed under these temporary housing measures in available vacant units should have the family or individual execute a 30-day renewable lease. Subject to state and local law, the lease should have a provision which states that the lease terminates when the resident’s permanent housing becomes available or when FEMA no longer certifies a resident’s FEMA eligibility. Rents for these temporary housing units must be set at the rents that were in effect immediately prior to the Presidential declaration. In the event the rents are more than the FEMA-approved rental assistance, the resident is responsible for paying the difference.
USE OF COMMUNITY SPACE
Owners are encouraged to allow community space, kitchens, restrooms and other facilities to be used as shelters or disaster recovery-related activities. However, use of these areas should be balanced to not overly disturb current residents or significantly interfere with the use by current residents.
OTHER REGULATORY/POLICY RELIEF
REAC Inspections – The Department’s practice is to postpone all physical inspections of projects in the immediate impacted area from the date of the PDD. The Department will conduct an evaluation from time to time to determine when, and for what counties, physical inspections will resume. When inspections are resumed, information will be posted on the REAC web site.
MF-FASS - Owners of multifamily properties located in the declared area that sustained damage, and who are required to file an Annual Financial Statement (AFS), may request an extension of up to 30 days to file their AFS. This extension request must be submitted electronically to REAC via the Multifamily Financial Assessment Subsystem.
Occupancy Requirements – Program occupancy requirements do not apply for residents who are afforded temporary housing. Certain exceptions for 202/811 are covered immediately below in Section D.
Vacant Units – Owners are encouraged to hold vacant units off the market in anticipation of providing temporary housing to FEMA-certified displaced residents. However, for Section 202/811 projects, vacant units can only be provided for temporary housing for FEMA-certified displaced residents, if there is no waiting list of otherwise eligible tenants. If a former Section 8 unit is used to house someone displaced by the PDD, he/she must pay market rent.
Evictions of Current Residents – Owners are encouraged not to evict residents who have not returned to their units in the impacted areas after the units have been repaired, if the resident has a reasonable basis for not returning (health, loss of income, loss of personal property like furniture, etc.). Once an apartment is repaired and ready for occupancy, Owners may hold the vacant units off the market for a reasonable time as long as the rent is current. If the resident is delinquent on rent payments, the owner is encouraged to make a judgment based on the facts and circumstances of each case. Owners must stay in contact with displaced residents and keep them informed of the date they can return to their units. However, if a displaced resident moves from a shelter or from temporary housing to other permanent housing, the owner is free to rent the unit. Owners must provide this information to residents in accessible formats for persons with disabilities and in appropriate languages for persons with LEP.
Use of Escrows – The Department will approve use of reserves for replacements/residual receipts to make necessary repairs pursuant to outstanding Departmental policy and Handbooks. Mortgagees are encouraged to provide priority processing for these requests.
For a Secretary-held mortgage, once the request for funds (Form HUD-9250) is received, the approval will be expedited. Headquarters will use United Parcel Service for overnight mailing. The field office must provide a specific address (not a post office box) to ensure that the release of funds is expedited. Also, the request for funds must be identified as “disaster relief.”
Insured Loans Mortgagee Servicing – HUD will instruct mortgagees to allow maximum flexibility for owners with delinquent project loans in the PDD impacted areas. HUD encourages owners to quickly repair their properties to permit the return of displaced residents. The mortgagee should be advised on all developments related to repairs, resident displacement and funding. Requests for extensions to assign a note through MDDR will receive expeditious processing by HUD.
HUD-Held and 202 Mortgage Servicing – The Department will allow mortgagors to defer their payments, if they are using project funds to repair the property or for security, etc. while waiting for insurance benefits or disaster financial assistance. HUD may approve a temporary forbearance plan under these circumstances. Hub Directors are authorized to approve foreclosure forbearance agreements in PDD areas in maximum increments of 90 days for properties that meet the following minimum requirements:
The Hub Director determines that it is likely that forbearance will result in restoration of the project to full operation and the mortgage brought current;
The property has underfunded repair needs; and,
The owner is actively negotiating for or awaiting an insurance claim payment, or the owner is actively negotiating or awaiting a release of grant funds
.The owner otherwise is in full compliance with all business agreements with HUD.
The owner is required to execute a Forbearance Agreement that will include the terms of the forbearance and will require the owner to submit a monthly accounting report and progress report of negotiations and repairs. HUD handbook 4350.1, REV-1 provides a sample workout agreement that can be used for these purposes. A copy of the forbearance agreement must be sent to the Multifamily Notes Branch for HUD-Held properties and the Chief Financial Officer’s (CFO’s) office in Fort Worth on Section 202 and 811 projects as well as a copy to the Office of Asset Management in Headquarters.
Insured mortgages: If the lender requests forbearance, a 90-day extension of the election to assign may be approved under the same circumstances as above except that the mortgagee will provide the information above to the Hub Director for approval. All extensions must be requested through the Multifamily Delinquency and Default Reporting System (MDDR).
When funds are secured to repair the property, the Hub Director may approve a final written forbearance agreement and/or extension to assign if the following conditions are met:
The Hub Director has determined that the funds are sufficient to fully restore and preserve the property and to pay I full, all delinquencies and arrearages in the mortgage accounts;
The owner has a Hub approved, time-phased repair plan with a targeted end date, and is I full compliance with the plan and its other business agreements; and,
The owner submits monthly accounting reports and monthly progress reports as required by the Hub.
If there is a serious default of the repair plan or failure to supply cash required to cure the deficiencies, the Hub will follow normal disposition and enforcement policy and practices.
Where it is determined that there is no possibility of preserving the property, no forbearance or extensions of elections to assign should be approved. The Department’s normal disposition policies and procedures will apply.
Mortgage Prepayment – Mortgagors who wish to prepay their FHA insured or HUD-Held mortgage are subject to any existing lockout provisions, applicable use restrictions, resident notification and HUD review/approval requirements. No exceptions are authorized for properties located in the PDD areas.
For Section 221 and 236 properties that are preservation-eligible and the owner has a right to prepay without HUD approval, the owner must provide the statutory Resident Notification letter no less than 150 days and no more than 270 days before the intended payment date. Owners of properties in the PDD area shall post notice at the property as well as send the statutory required Resident Notification letter to each tenant residing at the property on the date of the disaster, via regular and certified mail to the resident’s last known address. The owner must retain copies of all notification letters and certified receipts in resident files. If the owner does not provide the appropriate resident notification, the owner must execute a use agreement.
For Section 221 and 236 properties where HUD approval is required to prepay and the project is subject to 250(a) of the national Housing Act (Notice 2004 -17), the Department will continue to require owners to send the Resident Notification letter via regular and certified mail to the resident’s last known address. The owner must retain copies of all notification letters and certified receipts in the resident files. However, the Department will consider an exception request to lessen the notice period for these projects. Exception requests should be forwarded to the Office of asset management in Headquarters for review. A Rental use Agreement must also be executed and recorded at the time of prepayment
Resident Occupancy/Eviction – Residents who have been displaced from their unit have a right of first refusal for a reasonable time after their unit is repaired and ready for re-occupancy. Owners must inform residents in writing when their unit is habitable and can be re-occupied. Residents should be given a reasonable time to return to their unit, usually, within 60 days after notification of availability. Owners are encouraged not to evict residents who have not returned to their unit for good cause or who have reduced income due to a job loss as a result of the declared disaster. Payment plans for delinquent rents are encouraged. However, if a displaced resident moves to other permanent housing, the owner may rent the unit. Owners must provide this information to residents in accessible formats for persons with disabilities and in appropriate languages for persons with LEP.
Resident Files and Recertification Requirements – If resident files are destroyed or unavailable as a result of a PDD, an owner/agent can use the TRACS certification database in Secure Systems as a source of information for HUD assisted residents. In such cases, TRACS can be used to establish or confirm who resided at the site and who received HUD rental assistance prior to the PDD. In addition, if the waiting list information for assisted units was lost due to the PDD, the owner/agent must advertise the availability of assisted units in accordance with the Affirmative Fair Housing Marketing Plan, and create a new waiting list. The owner is responsible for documenting the loss of the pre-PDD waiting list and the need for “starting over.” All returning residents who are subject to income certification requirements must be recertified as soon as possible upon their return to the property if their income or other eligibility criteria has changed, or if they are due for an annual recertification. The recertification process should be initiated no later than 15 business days after the displaced resident returns.
SECTION 8 SERVICING
Routine servicing should remain in place as long as a resident is occupying a habitable apartment. However, a Project Manager may need to take special action with regard to apartments covered under a Section 8 Contract if any or all of those apartments are damaged. This section describes four actions that can be taken if some or all of the apartments covered by Section 8 are damaged, inaccessible, or without services and/or utilities.
A. Section 8 Contract Suspension – Section 8 must be suspended on a vacated apartment beginning the following month after the resident has been displaced, unless Headquarters approves otherwise. The suspension may not be lifted until the resident returns or the unit is ready for re-occupancy. Since all disaster related suspensions require Headquarters approval they are done on a case by case basis. The need to suspend must be discussed during the regular post PDD conference calls with Headquarters.
Tenant Holding-Over – Section 8 payments cannot be made if a unit has been
declared uninhabitable or condemned. Suspended payments should not resume
until all code violations are removed and the unit is declared habitable. This is
the case even if the resident chooses to remain in the uninhabitable apartment.
The Owner should evict a resident who refuses to voluntarily move from an uninhabitable unit which does not meet with local code requirements.
C. Section 8 Pass Through - Owners with residents under a project-based Section 8
HAP contract whose unit was rendered uninhabitable may temporarily lease a unit
in another building, which is habitable, under Uniform Physical Condition Standards
with approval from Headquarters. The Owner can sign a temporary lease on behalf
of the displaced Section 8 resident and begin to voucher for the contract rent for that
temporary unit. The owner then pays no more than the contract rent on the
temporary dwelling until the resident’s permanent rental unit has been restored to
habitable condition and the owner notifies the resident that they may resume occupancy of their former unit. The resident is still responsible for the resident’s share of the temporary rent. The Hub will be responsible for inspecting the “pass
through” apartment before occupancy to ensure it meets physical standards. Or, the owner may provide a third party inspector acceptable to HUD, to inspect.
to an eligible Section 8 applicant. Before doing so, however, the owner must inform
the resident in writing that their assistance is terminated. In the event that the owner
rents the unit to an eligible Section 8 applicant, the owner must first terminate the
“pass through” lease that the owner executed on behalf of the displaced resident.
In addition, should the temporarily displaced resident move from the temporarily
leased unit before their permanent rental unit is repaired and made available for
their return, the owner can no longer voucher for the temporary unit and the resident
is considered permanently housed.
Once the original unit is fully repaired and ready for occupancy, all Section 8
provisions apply. This arrangement calls for close contact and cooperation between
the Owner and the resident.
The PASS-through arrangement is only available to residents and owners who
voluntarily agree to the conditions. HUD will not assume any additional costs such as relocation expenses or utility expenses related to a Pass-through arrangement.
D. Section 8 Apartments Occupied by Ineligible Residents - The Department will
allow an owner to temporarily rent a vacant Section 8- assisted apartment to a
FEMA-certified displaced resident. However, the owner can only voucher, and the
Department may only pay, Section 8 housing assistance payments for units
occupied by eligible Section 8 families. Therefore, there would be no housing
assistance payment made on behalf of a non-eligible Section 8, FEMA certified
Transferring a Section 8 Contracts to a Different Property
Residents who occupied units at the time of a PDD that were destroyed, condemned or substantially damaged and the Section 8 Housing assistance Payment (HAP) contract is transferred to a new property, have the right to move to the new property. Those residents who received Section 8 assistance prior to the disaster, and who remain qualified, will receive Section 8 rental assistance at the new property.
Section 8 HAP Contract Opt-Outs
Opt-out requests for properties that have been condemned, destroyed or substantially damaged as a result of a PDD will be handled on a case-by-case basis. The procedures for opt-outs are outlined in Chapter 11 of the Section 8 Renewal Policy Guide. Please note that for projects that have been deemed uninhabitable by the Department and no residents are residing in the project, the notice requirement of Section 8(c)(8) of the United States Housing Act of 1937 will be reduced from one-year to 120 days. The notice must be issued to each resident at the last known address via regular and certified mail (return-receipt requested). Guidance will be provide by Headquarters regarding securing, issuing, and the eligibility of of tenant protection vouchers for the disaster-displaced residents of a multifamily housing property where the owner opts-out of the Section 8 HAP Contract.
FHA-INSURED PROJECTS IN THE DEVELOPMENT PHASE
Vacant units in pipeline properties may be made available for temporary housing and permanent housing, if they can be released for this purpose. Owners and local Hub officials are encouraged to take the necessary steps to make units available.
APPROVAL OF INSURANCE LOSS DRAFTS
The Hub Director has the authority to execute insurance loss drafts on Secretary-held and 202/811’s. Mortgagees are encouraged to expedite their approval of the draft, as well as, on insured loans.
MARK-TO-MARKET PROPERTIES (OAHP)
For properties going through the Mark-to-Market Program, HUD will grant a reasonable extension of time for owners impacted by the declared disaster. This will allow for additional time to hold resident meetings and for delays in property inspections and/or appraisals for affected properties. For owners whose properties are not affected, but who have documented properties elsewhere affected by the declared disaster, causing them to be delayed in their responsiveness on any property going through debt restructuring, HUD will consider these factors when exercising its discretion about an owner’s responsiveness and in imposing time-related penalties.
USE OF PROJECT RESERVE FUNDS AND OWNER CONTRIBUTIONS
The Department will allow the use of reserve escrows for immediate project use other than for typical Reserve uses, to augment cash flow for the period of the emergency. Owners must negotiate and sign a repayment plan with HUD. Reserves must be replenished from local, state, or federal benefit programs as well as insurance proceeds when they become available.
Owner contributions during the emergency period can be repaid to the Owner under a
written plan approved by HUD. The Hub Director has the authority to approve such a plan.
Owners who are adversely affected by a PDD are encouraged to contact the appropriate HUD office, in writing, if they are unable to respond in a timely manner to any correspondence or notices such as default notices, notices of violation, enforcement notices, etc. Based on the documentation submitted by Owners, the HUD office will consider the effect of the disaster on the owner’s ability to comply and will exercise discretion in judging responsiveness before imposing any time-related penalties or delaying inspections, approving assignment extension, etc. as appropriate.
HEADQUARTERS, FIELD OFFICE, OWNER/AGENT AND RESIDENT RESPONSIBILITIES
See Appendix A-8.
APPENDIX A-1 EMERGENCY MANAGEMENT STRUCTURE Continuity of Operations (COOP): Presidential Decision Directive (PDD) 67 established the requirement that all Federal Executive Branch departments and agencies have in place a comprehensive and effective program to ensure the continuity of essential Federal functions under any circumstances. To support this policy the Federal Executive Branch has implemented the Continuity of Operations (COOP). COOP is defined as the activities of individual departments and agencies and its subcomponents to ensure that its essential functions are performed including plans and procedures that delineate essential functions; specify office succession and the emergency delegation of authority; provide for the safekeeping of vital records and databases; identify alternate operating facilities; provide for interoperable communications; and validate the capability through test, training and exercise. The Hub emergency response for natural disasters should be incorporated into the COOP.
Federal Emergency Management Agency:
On March 1, 2003, the Federal Emergency Management Agency (FEMA) became part of the U.S. Department of Homeland Security (DHS). The primary mission of the Federal Emergency Management Agency is to reduce the loss of life and property and protect the Nation from all hazards, including natural disasters, acts of terrorism, and other man-made disasters, by leading and supporting the Nation in a risk-based, comprehensive emergency management system of preparedness, protection, response, recovery, and mitigation.
Robert T. Stafford Disaster Relief and Emergency Assistance Act, PL 100-707, signed into law November 23, 1988; amended the Disaster Relief Act of 1974, PL 93-288. This Act constitutes the statutory authority for most Federal disaster response activities especially as they pertain to FEMA and FEMA programs.