3-3. OPTION ONE-A ENTITLEMENT MARK-UP-TO-MARKET ELIGIBILITY

Properties that meet the criteria listed in Section 3-2 and this Section are eligible for a Section 8 contract renewal under Option One-A.

• A. Market Rents. The owner’s Rent Comparability Study (RCS) must demonstrate that the comparable market rents are at or above 100 percent of the fair market rent (FMR) potential. Use the FMR figures calculated for the fiscal year in which the project is entering MUTM to demonstrate eligibility.

  1. Excel Worksheets. Fillable worksheets are available on the Internet at http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/mfh/mfhsec8 under “Forms Associated with Section 8 Renewals.”

  2. iREMS. The AE/CA should use the Integrated Real Estate Management System (iREMS) to establish initial eligibility. Owners and Contract Administrators can use the fillable worksheets at the website listed above in A.1.

• B. Use Restrictions. The project does not have a low- and moderate- income use restriction that cannot be eliminated by unilateral action by the owner. Examples of such a use restriction would be the existence of Flexible Subsidy assistance, Low-Income Housing Tax Credits, or Recap’s Green Retrofit Program. If the project is subject to any use restriction at the time of the renewal request, the AE/CA must determine whether it is the type of use restriction that makes a project ineligible for Option One-A.

• C. The project is not subject to a contract for moderate rehabilitation assistance under section 8(e)(2) of the United States Housing Act of 1937, as in effect before October 1, 1991.

• D. The project is not one for which a public housing agency provided voucher assistance to one or more of the tenants after the Owner has provided notice of termination of the contract covering the tenant’s unit.

• E. Ownership.

  1. The project owner must be:

     • a. A profit-motivated entity (including a limited distribution entity);

     • b. A housing authority occupying the status of a “public body corporate and politic” under the state legislation under which it was created, or

     • c. A limited partnership with one or more nonprofit general partners or a sole general partner that is wholly owned and controlled by one of more nonprofit entities.; or

     • d. A limited liability company with one or more nonprofit managers or nonprofit managing members or a sole manager or managing member that is wholly owned or controlled by one or more nonprofit entities.