We Want Your Feedback!

The U.S. Department of Housing and Urban Development (HUD) included a proposal to transition Project Rental Assistance Contracts (PRACs) to five-year renewals in its budget request to Congress for fiscal year (FY) 2021 funding. The transition, which would be subject to annual appropriations, would also use Operating Cost Adjustment Factors (OCAFs) rather than budget-based rent increases.

HUD's description of the proposal is as follows:

Five Year PRAC Renewals: The Budget proposes a transition to five-year PRAC renewals, subject to availability of annual appropriations and utilization of an operating cost adjustment factor. The current annual budget-based process is burdensome for both owners and for HUD, especially as the PRAC portfolio has continued to grow; this will offer significant administrative streamlining. Providing that owners renew for five-year increments, while subject to a forty-year Capital Advance Use Agreement, would materially reduce administrative burdens for property owners and HUD. Projects in the Project-Based Rental Assistance (PBRA) program that serve exclusively seniors are currently funded this way, with no apparent negative effects on building operations. This proposal has no direct budgetary impact in 2021 as funding would still be initially set at a budget-based level. Going forward, funding would continue to be obligated in annual increments, similar to PBRA. Proposed changes in the Housing for the Elderly account language would work in concert with a planned submission of modest revisions to authorizations for the program in the National Housing Act of 1959, as amended.

LeadingAge NY and LeadingAge National would like your feedback on this proposal within the next two weeks. Please send any comments you have to Sara Neitzel and Linda Couch.

Contact: Sara Neitzel, sneitzel@leadingageny.org, 518-867-8835