| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #6944 | Closed | public | Multifamily | Les Sparks |
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Good afternoon. We have a question about a mixed HUD project: We’re auditing a Partnership that has purchased a 20 unit multifamily project. The project is covered by an old reg. HAP contract. The Partnership intends to build an additional 19 units that won’t be covered by the HAP contract. Will this project be required to separately account for the 20 HAP units and the 19 non HAP units in REAC? We’ve run into several instances with other projects where HUD has requested a “consolidated” submission for a single Partnership that splits HUD and non HUD units – or splits the operations of a Partnership amongst multiple HAP agreements. Is there a rule of thumb in determining whether HUD will request a project be split apart for REAC submission? |
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From Les Sparks: This depends of sorts. Is this an older 202 program that the attachment would apply to? If so, then you have the guidance. If the attachment does not apply, then I would say the submission continues for all units. However, since there is no mortgage you will only be reporting in the 20 HAP units. I do no think you have to do any real separation. What you are describing sounds very much like a project where only 50% of the units are subsidized. Nothing special in that one. If the notice applies, then so be it. From client: Thank you for the info. This is what I suspected, but I didn’t know if there was any concrete guidance out there (we always seem to deal with this with two fingers crossed behind our backs). Thanks for the notice, I’ll keep this handy as a reminder that Section 202 projects are the ones to watch out for. |