Example – Project-Based and Individual Tenant Subsidy Programs Prorated Rent

Family D has four persons. Three are eligible immigrants, and one has elected not to contest ineligible status. The family’s TTP is $200. The gross rent for the family is the Section 236 basic rent, which is $300. The market rent is $500.

Market rent $500 Basic rent $300 TTP $200 Assistance payment $100 Fraction is Number of ineligible persons 1 Total number of family members 4 Section 236 calculation Project-based subsidy $500 - $300 = $200 (market rent less basic rent) Project-based subsidy times fraction $200 x ¼ = $50 RAP, Rent Supplement, or Section 8 Calculation Assistance payment times fraction $100 x ¼ = $25 New tenant rent (TTP + Section 236 $200 + $50 + $25 = $275 proration + tenant based subsidy proration)

• b. Before the end of each deferral period, the owner must determine whether affordable housing is available to the family and whether to extend the deferral of termination of assistance.

  • (1) To extend a deferral period, an owner must determine that no affordable housing is available. The owner must inform the family of the owner’s determination at least 60 days before the current deferral period expires. The owner’s determination should be based on the following:

    • A vacancy rate of less than 5% for affordable housing of the appropriate unit size in the housing market for the area in which the housing is located;

    • The local jurisdiction’s Consolidated Plan, if applicable;

    • Availability of affordable housing in the market area; and

HUD Occupancy Handbook Chapter 3: Eligibility for Assistance and Occupancy

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• Evidence of the family’s efforts to obtain affordable housing in the area.

• (2) To terminate assistance, the owner must determine that affordable housing is available, or that the maximum deferral period has been reached.

• (3) If eligible for prorated assistance, the family may request and begin to receive prorated assistance at the end of the deferral period.

• (4) Affordable housing for the purpose of temporary deferral of assistance is housing that:

  • Is not substandard;

  • Is the appropriate size for the family; and

  • Can be rented by the family for an amount less than or equal to 125% of the family’s total tenant payment (TTP), including utilities.