hotma compliance updates

• CHFA Multifamily Program Compliance Manual for Housing Tax Credit and CHFA Multifamily Loan Programs Updated for HOTMA
• Housing Tax Credit and Multifamily Loan Programs Compliance Forms Updated for HOTMA
• Upcoming HOTMA Trainings through chfareach
• Section 8 Updates

CHFA Multifamily Program Compliance Manual for Housing Tax Credit and CHFA Multifamily Loan Programs Updated for HOTMA

The 2024 updates primarily address changes required by the Housing Opportunity Through Modernization Act of 2016 (HOTMA) that impact income, assets, and student financial assistance. HOTMA took effect January 1, 2024. Implementation of CHFA's updated policies is mandatory for all developments beginning no later than January 1, 2025.

View a full list of all new and revised Program Compliance Manual sections.

Housing Tax Credit and Multifamily Loan Programs Compliance Forms Updated for HOTMA

CHFA updates compliance forms as needed, and owners are encouraged to visit the Program Compliance Forms page regularly for the most current forms. The page includes a Compliance Form Current Version list showing when each form was last revised.

To comply with HOTMA requirements, the compliance forms listed below have been revised.

As a reminder, owners are not required to use CHFA’s forms, as long as the owner’s forms contain all the same questions and content.

As always, please contact your Program Compliance Officer (PCO) with any compliance-related questions for the HTC and CHFA Loan programs. To find your PCO, search on CHFA’s website by city and property name:

 www.chfainfo.com/rental-housing/asset-management/welcome-chfa-asset-management#FindOfficer 

Upcoming HOTMA Trainings through chfareach

• CHFA HOTMA Updates, Webinar for Housing Tax Credit and CHFA Loan Developments: July 23, 2024
• NCHM HOTMA Compliance Workshop for All Programs, Denver: August 20, 2024
• Section 8 Training: To be scheduled in the fourth quarter – exact date TBD

Project-based Section 8 Updates

HUD is in the process of updating the Tenant Rental Assistance Certification System (TRACS) to version 203.A to accommodate the various changes required by HOTMA. While HUD has stated HOTMA compliance is mandatory effective January 1, 2025, they have not yet stated a date for the release of TRACS 203A. HUD has stated that more information will be forthcoming.

Compliance Date and Required Actions for MFH Owners (Office of Multifamily Housing)

• Although full compliance with the HOTMA final rule is not until January 1, 2025, Tenant Selection Plans and EIV Policies and Procedures were to be updated by May 31, 2024, to reflect HOTMA rules and discretionary policies and be made publicly available per HUD guidance.
• Until OMB approves the new forms, including leases, TRACS and compliance software, MFH O/A’s will need to continue operating under their old plans.
• To document processes for HOTMA compliance, O/A’s need to provide CHFA with a written implementation outline to demonstrate full compliance by January 1, 2025.

What MFH Owners must do once their software is HOTMA compliant:

• MFH Owners must provide tenants at least 60 days’ notice that their lease will be modified at the end of the lease term after the expiration of the 60 days’ notice. Once proper notice is given, MFH Owners must begin using the revised Model Leases at the expiration of a family’s lease term.
• MFH Owners must implement their revised Tenant Selection Plans and EIV policies and procedures.
• All tenant data submissions must comply with the HOTMA regulations. Prior to their first reexaminations under HOTMA, MFH Owners must inform families that their income determinations will be conducted in accordance with the HOTMA final rule. As a best practice, HUD recommends that MFH Owners describe to families how their income determinations will change with the implementation of the final rule.
• MFH Owners must use the revised Tenant Consent form (form HUD–9887/9887A) and Fact Sheets (“How Your Rent is Determined”).

How HUD will monitor MFH Owner compliance prior to January 1, 2025:

Prior to January 1, 2025, MFH Owners will not be penalized for HOTMA-related tenant file errors during Management and Occupancy Reviews (MORs). However, CHFA may require additional information or clarification if processes are vague.

By January 1, 2025:

Full compliance with the HOTMA final rule is mandatory effective January 1, 2025.

How HUD will monitor owner compliance on or after January 1, 2025:

• Contractor Administrators will issue HOTMA-related findings during MORs.
• MFH Owners must correct all HOTMA-related observations that may have been issued by Contract Administrators during 2024.
• MFH Owners who fail to implement HOTMA may be found in default of their business agreements with HUD.

More information can be found on the HUD HOTMA website: Housing Opportunity Through Modernization Act | HUD.gov/U.S. Department of Housing and Urban Development (HUD).

Below are links to the notice and a list of discretionary policies to implement under HOTMA.

• Notice H 2023-10, Notice PIH 2023-27 - Implementation Guidance: Sections 102 and 104 of the Housing Opportunity Through Modernization Act of 2016 (HOTMA)
• List of Discretionary Policies to Implement HOTMA