Note: Owners can request that the existing Demo Program Use Agreement be extended to…

2. An exception is permitted for projects with a recorded Budget-Based Without Mortgage Restructuring Demo Program Use Agreement. The owner may renew under Option One or Two for a minimum term of the project’s Use Agreement and a maximum term of 20 years.

• C. Rent adjustments

  1. In the case of a renewal contract with a term more than five years, at the end of each 5-year period, the owner must obtain a RCS to permit HUD/CA to adjust project rents to the extent that they have risen above or fallen below market during such 5-year period.

     • a. If the rents are below comparable market rents, the AE/CA shall adjust the rents to equal the comparable market rents.

     • b. If the rents are above comparable market rents, the AE/CA shall reduce the rents to the comparable market rents.

  2. In years two through five, rents may be adjusted by either:

     • a. The published OCAF, or

     • b. A budget-based rent adjustment.