HUD Approves Use of Residual Receipts to Preserve Oregon Assisted Housing

On October 21st, Reneé Greenman, HUD Region X Multi-Family Hub Director, approved the use of up to $585,000 in Residual Receipts to help finance the preservation of Stewart Terrace, an Oregon Housing and Community Services bond financed Section 8 property in McMinnville. HUD headquarters staff acknowledged the state’s authority, under Part 883, to determine allowable “project purposes” and concurred with the Portland Field Office decision to allow use of the Residual Receipts to help cover the costs of the renovations.

While it is too early to determine if this signals a change in policy by HUD it does potentially free up as much as $9 million currently tied up in Oregon Section 8 project Residual Receipts accounts for financing preservation transactions.

Preserve Oregon Housing staff have been working with HUD locally and with the new HUD Administration on securing approval for the use of these restricted funds to help finance the preservation of expiring-use projects. The city of Portland with OHCS and with two Portland area developers have been working for several years now with Oregon Senators Wyden and Merkley to draft legislation which would allow this use outright. Last month the Senators jointly introduced S.1676 which would provide access to project specific Residual Receipts accounts for a broad range of uses on preservation transfers. See post dated 9/16/2009 for more on S.1676.

— Posted on 11/02/2009