From Les Sparks:

The OCAF adjustment is only relevant to the PBRA process. No application to HCV. OCAF adjustments are typically made on anniversary dates. Updates will be made before closing depending on when your units were made available to you. For instance, the original 60K units had rates determined as of 2012, so OCAF for several years may be applied by closing. Here is what HUD has said.

2015 HUD Appropriations and the RAD Program
–
Supplemental Guidance
On December 24, 2014, the Department issued a RADBlast regarding plans to implement the provisions in the 2015 HUD Appropriations Act regarding the Rental Assistance Demonstration (RAD). This RADBlast provides supplemental guidance based on stakeholder questions.

RAD First Component
Q: When does the Department expect to issue final awards (called Commitments to Enter into Housing Assistance Payments Contracts, or CHAPs) for those on the waiting list who have already received Contingent Approval letters?
A: The Department anticipates issuing CHAPs in February and completing that process within 45 days. A separate Federal Register notice describing how the Department will issue CHAPs was published on January 29, 2015 
Q: Can you clarify how rents will be set for units that are awarded as part of the initial 60,000 units vs. awards made pursuant to the increase in the cap to 185,000 units, including the application of Operating Cost Adjustment Factors (OCAFs)?

A: All RAD applications, including applications for Portfolio or Multi-Phase awards, will have initial contract rents based on their “RAD rent base year:”

All properties awarded under the original 60,000 unit cap have initial contract rents based on FY 2012 funding levels (“FY 12 RAD rent base year”). These rents will be adjusted each year by HUD’s published Operating Cost Adjustment Factor (OCAF) starting in Calendar Year (CY) 14 and established in the HAP contracts at the time of conversion. Thus, for a project in this category that closes in 2015, the initial contract rents will be based on 2012 funding, with an OCAF adjustment for both 2014 and 2015.

All properties awarded above HUD’s original 60,000 unit cap will have initial contract rents based on FY 2014 funding levels (“FY 14 RAD rent base year”). These rents will be adjusted each year by HUD’s published OCAF starting in CY 15 and established in the HAP contracts at the time of conversion. Thus, for a project in this category that closes in 2015, the initial contract rents will be based on 2014 funding, with an OCAF adjustment for 2015.

Here is the general comment:

11.4 Annual Operating Cost Adjustment Factor (OCAF) Rent Adjustment
At least 120 days before the contract anniversary date of the HAP, the owner submits the OCAF Rent Adjustment Worksheet, HUD 9625, to HUD Project manager/Contract Administrator (PM/CA). The PM/CA will validate the data on the HUD Form 9625 and process the OCAF Rent Adjustment. Once completed, the HUD/CA will provide the new rents to the owner with an effective date of the contract anniversary. The owner will complete a gross rent adjustment in the TRACS software and transmit it to TRACS.

From Client:

So is the anniversary date going to be the date when the initial CHAP was issued or based on the closing date? You mention that this is only for PBRA. Would it not be applicable if PBV is elected vs PBRA? These are not HCV.

For example, I have a CHAP letter that is dated 3/19/2015 and it is using the 2014 rents. If RAD closes on 3/1/2017, would the anniversary date used for the 2017 OCAF adjustment be the date of the CHAP letter (3/19/2017) or would it be the date of the HAP contract assuming that it is the same day that RAD closes (3/1/2017)?

From Les:

Justin, to the best of my knowledge, The anniversary date is the date it closes. Therefore, if the RAD rent was set using 2014 data they will get OCAF adjustments for 2015 and maybe 16 upfront and then annually thereafter on the anniversary date.

OCAF does not apply to PBV as it is really HCV as these new project-based vouchers are adminstered and treated as HCV.