HUD recently issued guidance about combining Section 8 Housing Assistance Payment (HAP) contracts that contain similar provisions and those that contain differing provisions for Multifamily Field Office Staff. Contracts may be combined by mutual agreement between the owner and HUD, and the units and budget authority rolled in the surviving contract which will then be renewed for a 20-year term. Owners can request that contracts be combined at any time. The memo does not apply to Project Rental Assistance Contracts (PRACs) or Project Assistance Contracts (PACs).

Benefits of combining Section 8 contracts include:

  • Lowered administrative costs
  • Reduced oversight (i.e. one Management and Occupancy Review (MOR), one audited Annual Finance Statement (AFS), etc.)
  • Potential to share reserves and facilitate a better capitalized property assisting a struggling property; and
  • Superior debt and equity terms and pricing

Owners that wish to combine Section 8 contracts should contact their Multifamily Field Office staff.

Click here to read the memo.