Boston Housing Authority

Policies > Section 8 Admin Plan Ch 8: Rent

Section 8 Admin Plan

Chapter 8:Rent

8.1 Commonly Used Rent Terms

Adjusted Annual Income - Annual Income of all Family members, as verified by the BHA, after deductions, exceptions and exclusions are made with respect to each of the members of the Family to determine initial and continued program eligibility.
Contract Rent - The monthly rent payable to the Owner under the Lease and any amendments.  The Rent to Owner also covers payment for any housing services, maintenance, and utilities that the Owner is required to provide and pay for.
Gross rent - The sum of the rent to the Owner plus any utility allowances.
HAP Contract – The contract that governs the monthly assistance paid by the BHA to the Owner.
Monthly Adjusted Income - One twelfth of Adjusted Annual Income.
Payment Standard - The maximum monthly assistance payment for a Family before deducting the Total Tenant Payment by a Family.  For a Voucher tenancy, the housing authority sets a Payment Standard in the range from 90% to II0% of the current HUD FMR or at any exception Payment Standard amount approved by HUD.
Reasonable Rent - A Rent to Owner that is not more than charged: (a) for comparable units in the private unassisted market; and (b) for a comparable unassisted Unit in the premises.
Tenant Share of Rent (Household Rent to Owner) - In the Voucher program, the portion of the monthly Rent to Owner paid by the Household.  For calculation of Rent to Owner see 24 C.F.R. § 982.515(b).
Total Tenant Payment (TTP) - Total Tenant Payment is the amount calculated under Section 3(a)(1) of the 1937 Act, which is the higher of: 30% of the Family’s Monthly Adjusted Income, 10% of the Family’s Monthly Income, the minimum rent, or if the Family is receiving payments for Welfare Assistance from a public agency and a part of such payments, adjusted in accordance with the Family’s actual housing costs, is specifically designated by such an agency to meet the Family’s housing cost, the portion of such payments which is so designated.
Utility Allowance - If the cost of utilities (except telephone) and other housing services for an assisted Unit is not included in the tenant rent but is the responsibility of the Family occupying the Unit, an amount equal to the estimate made of approved by a housing authority or HUD of the monthly cost of a reasonable consumption of such utilities and other such services for the Unit by an energy-conservative Family of modest circumstances consistent with the requirements of a safe, sanitary, and healthful environment.
Utility Reimbursement - The amount, if any, by which the Utility Allowance for the Unit, if applicable, exceeds the Total Tenant Payment for the Family occupying the Unit.

 8.2       Determination of Contract Rents 

Contract rent is the total rent to the Owner specified by the Lease and any amendments. The BHA may not approve a Lease until the BHA determines that the initial rent to the Owner is a Reasonable Rent.  At all times during the assisted tenancy, the Rent to Owner may not exceed the Reasonable Rent as most recently determined or redetermined by the BHA in accordance with section 8.3 of this Administrative Plan. 

8.2.1    Mandatory Redetermination 

The BHA must redetermine the Reasonable Rent:
(a)        Before any increase in the rent to the Owner; or
(b)        If there is a five percent (5%) decrease in the published Fair Market Rent (FMR) in effect sixty (60) days before the anniversary of the HAP Contract (for the Unit size rented by the Family) as compared with the FMR in effect one year before the HAP Contract anniversary; or
(c)        As directed HUD.           

8.2.2    Permitted Redetermination 

The BHA may re-determine the Reasonable Rent at any other time, in accordance with the language in the HAP Contract. The BHA may also re-determine the Reasonable Rent based on periodic surveys of rent in the City of Boston, its surrounding neighborhoods, and neighboring communities. 

8.3       Reasonable Rent 

The Reasonable Rent is a Rent to Owner that is not more than rent charged for comparable units in the private unassisted market and for comparable unassisted units in the premises.
The Reasonable Rent is the maximum amount the BHA may approve for the Contract Rent, even if the Family and the Owner agree to a higher rental amount.
The BHA determines Reasonable Rent by comparing the subject Apartment to similar Apartments in the private rental market in conjunction with a point system based on several factors of the individual Unit. 

8.3.1    Point System 

The BHA has established a point system to help assess the Reasonable Rent for each Unit.  The BHA collects data on the Unit to be subsidized and assigns points to them using the nine factors listed below.  The BHA may also collect these nine factors on a Private Market Unit when the data are available, due to the Private Market units being located in the subsidized property. 
These point totals are used in determining a range for Reasonable Rent (exceptional, good, average, and below average) among the subsidized units. The BHA will use the point totals to place the best quality units on the high end of the established Reasonable Rent scale.
The weight the following factors have in determining Reasonable Rent varies depending on the conditions of the rental market. For example, in a tight rental market these factors will have less impact on determining the Reasonable Rent for a Unit.
Factors used in the point system are:
(a)        Number of Bedrooms;
(b)        Location (Street, Zip Code and Census Tract);
(c)        Unit Type;
(d)        Utilities (Types of fuels used and whether Owner supplied);
(e)        Age of Structure;
(f)         Quality (Overall assessment of the materials used such as kitchen cabinets, etc.);                      
(g)        Amenities;                  
(h)        On-Site Maintenance;
(i)         Housing Services Available. 

8.3.2        Assessment of Private Market Value Rents (Comparables) 

The BHA determines a Reasonable Rent for the subject Unit by comparing it to the market information gathered in a similar area.
(a)        In the private sector, market lease rents are typically based on location, bedroom size, and quality. However, the BHA gathers additional data when available.  The data that the BHA collects includes: 

(1)               Location: The geographical area or neighborhood of the subject Unit. 
(2)               Number of Bedrooms: The number of bedrooms and the size of the overall Unit.  A three-bedroom Unit would be compared to other similarly sized three-bedroom units.
(3)               Quality: The BHA rewards those Units that are higher quality by setting higher Reasonable Rent.
(4)               Other relevant data upon availability: The BHA will also use any other relevant data, including but not limited to: amenities, housing services, age of structure, on-site maintenance, if available.  

(b)        The BHA collects data on the four factors listed above to compare the subsidized Unit to a private market Unit.  The informational databases that the BHA keeps are updated regularly and keep data for at least two (2) years. The following, is a non-exhaustive list of some of the types of data that the BHA may use to assess the above listed factors: 

(1)               The BHA Rent Roll database of private market rents (The BHA collects and updates regularly the database of approximately 1500 - 2500 private market units throughout Eastern Massachusetts),
(2)               Newspaper Advertisement database,
(3)               Certification supplied either by the Owner or manager including a rent roll of similar unassisted Units in the building,
(4)               Copies of existing Leases of similar unassisted Units either in the building or the surrounding neighborhood, affidavits from realtors in the neighborhood providing the current rents,
(5)               Internet resources. 

(c)               Weight of Comparison Data 

When determining the Reasonable Rent, Private Market comparison data is used in the following preferential order: 
(1)               Data on the Units located in the same building or developments as the assisted Unit.
(2)               Data from the Rent Roll database
(3)               Data from the Newspaper Database  

8.3.3    Owner certification of comparability 

By accepting each monthly housing assistance payment from the BHA, the Owner certifies that the Contract Rent is not more than rent charged by the Owner for comparable unassisted Units in the premises. The Owner must give the BHA information requested by the BHA on rents charged by the Owner for other Units in the premises or elsewhere. 

8.4       Maximum Initial Rent Burden 

At the time the BHA approves a tenancy for initial occupancy of an Apartment by a Family with HCVP assistance, and where the Gross rent of the Unit exceeds the applicable Payment Standard for the Family, the Family Share may not exceed forty percent (40%) of the Family’s Adjusted Monthly Income. See also 24 C.F.R. § 982.508. 

8.5       Rent Exceptions 

The BHA may approve an exception of up to 110% of the HUD FMR as a Reasonable Accommodation.
The BHA will request the HUD field office to approve an exception Payment Standard of up to 120% of the Fair Market Rent (FMR) if the exception is needed as a Reasonable Accommodation so that the HCVP is readily accessible to a Disabled Person in accordance with 24 C.F.R. parts 8 and 982. The BHA will apply to HUD for higher Payment Standards for neighborhoods when the BHA determines that exception Payment Standards are necessary to effectively administer its HCVP, and where such exception Payment Standard can assist Participants in leasing units outside areas of low income or Minority concentrations. Such rents must meet Reasonable Rent standards for comparable units.  Any request for a Payment Standard exception over 120% of the HUD FMR must be made to the HUD central office located in Washington D.C. 

8.6       Rent Increases 

8.6.1    General Procedure and Policy 

The Lease governs rent increases. To receive a rent increase, the Owner must send the request for a rent increase to the Participant and send copy of the request to the BHA sixty (60) days prior to the date of the requested increase. The rent may not be increased until after the initial one-year term of the Lease, or one-year has elapsed from the prior Lease amendment increasing the rent.
The Owner will send the initial rent increase requests to the Leasing Officer, who will advise the Owner of the effects of the increase. The Leasing Officer and the Owner will discuss any difference between the current Contract Rent and the Payment Standard for the particular Family size and Unit size and how the increase in rent may affect the Participant or the BHA’s portion of the rent. If the Owner wishes to proceed with the request after discussing the increase with the Leasing Officer, the rent increase request will be filed in the Participant’s folder and forwarded to the BHA Department of Inspections. The BHA Department of Inspections will approve or deny all rent increase requests and notify the Leasing Officer, Owner, and the Participant of the decision.
If the BHA grants a rent increase the adjusted rent will be the lesser of:

(a)        The Reasonable Rent as most recently determined by the BHA, or

(b)        The amount requested by the Owner. 

8.6.2    Participant Approval required after BHA Approval

If the BHA grants the Owner the ability to increase the rent the Leasing Officer will discuss the effect of the proposed increased rent with the Participant.  The Leasing Officer will advise the Participant of his or her share of the rent and their option to approve or disapprove of the rent increase. The Participant may negotiate the terms and the amount of the increase with the Owner and the Leasing Officer may assist the negotiation.  

(a)        Participant Approval of Rent Increase. If the Participant agrees to the increased rent the Leasing Officer will assist the Owner and the Participant in signing a Lease amendment to adjust the Contract Rent.

(b)        Participant Disapproval of Rent Increase. If the Participant does not accept the increase in rent or negotiate a rent that is acceptable to both parties, one of the following may occur:

(1)        The Owner may start an eviction proceeding against the Participant by citing a refusal to enter into a Lease amendment as a business or economic reason at the end of the initial one-year Lease term or after a year has elapsed from the last rent increase.

(2)        The Owner and the Participant continue under the current terms of the Lease and contract, moving forward without an increase in rent.

(3)        The Participant may request a Voucher to move to another Unit. The Participant must give thirty (30) days notice to the Owner and a copy of the notice to the BHA if the Participant intends to vacate the Unit. 

8.6.3    The rent will not be increased unless: 

(a)        The Owner requests the increase in writing sixty (60) days prior to the date of the requested increase;

(b)        The Owner has complied with all obligations of the HAP Contract and the HQS in the preceding year;

(c)        The Participant approves the increase in rent to the Owner; and

(d)        The BHA Department of Inspections approves the Apartment. 

8.6.4    Date of Rent Increase

After all other conditions of this policy are met; the Contract Rent will only be increased for housing assistance payments commencing on the later of:

(a)        The first day of the first month commencing on or after the initial Lease term; or

(b)        At least sixty (60) days after the BHA and the Participant receives the Owner’s request for a rent increase. 

8.7       Written Notice of Rent Share Change 

Before the BHA makes a change in the Contract Rent, the BHA will notify the Participant and the Owner in writing. The notice to the Owner will only contain the new rent and the date that it will be effective. The Notice of Rent Share Change to the Participant will contain the following information:

  • The Contract Rent and the Tenant Share of Rent and the date it will be effective, 
  • The amount of Participant's Household income, Family Composition and other facts considered by BHA in determining the new rent, 
  • If the rent share results from Proration of the Family’s subsidy because not all Family members are U.S. Citizens or have eligible immigration status, an explanation of the formula used to determine the rent share, 
  • The Family’s right to request in writing an explanation of the basis of the BHA’s determination and, to request in writing, an informal hearing if the Family still does not agree with the determination after the explanation,
  • If the Family requests an explanation, BHA staff will confer with the Family, and shall provide the Family with a written notice of adjustments made to the original determination,
  • The BHA will also notify the Family of their right to and the method of, calculation of rent and/or rent share. 

8.7.1    Effective Dates of Rent Share Increases and Decreases

 (a)        Rent decreases will be effective as of the first day of the next month after the change in circumstances is reported in writing.  BHA may delay processing the rent decrease until Participant provides adequate verification of such change in circumstances justifying the decrease, but once verifications have been provided, the rent change will be made effective retroactively if the failure to verify the decrease was not the fault of the Participant.
(b)        Rent increases will be effective the first day of the second month after BHA sends Participant a Notice of Rent Change.  If a Participant fails to report a change requiring a rent increase, rent shall be increased retroactively to the second month following the change had the reporting of income been timely. Increases in a Participant’s share of rent due to a relocation to a new unit will be effective on the initial date of the lease term.  

8.8       Tenant Share of Rent    

8.8.1    BHA determination 

(a)        The Tenant Share of Rent is the portion of the Rent to Owner paid by the Family. The BHA determines the Tenant Share of Rent in accordance with HUD requirements and BHA procedures.

(b)        Any changes in the amount of the tenant rent will be effective on the date stated in a notice by the BHA to the Family and the Owner.

8.8.2    Total Tenant Payment 

The Total Tenant Payment (TTP) represents the minimum amount a family must contribute toward rent and utilities regardless of the Unit selected. The TTP is calculated using a statutory formula and individual income information. To calculate TTP, annual adjusted income and annual (gross) income must be converted to monthly adjusted income and monthly gross income by dividing the annual figures by 12 months. The TTP is the greater of: 

(a)               30 percent (30%) of monthly adjusted income; or
(b)               10 percent (10%) of monthly gross income. 

8.8.3  Minimum Rent – The BHA may adopt a minimum rent within the range as prescribed by 24 CFR 5.630. Minimum rent may be applied immediately (upon 30 days written notice) but no later than the participants next annual recertification following its implementation .

(a)                Financial hardship exceptions: - A family may request and the BHA may grant exceptions to minimum rent requirements if the BHA determines that the family is unable to pay the amount due to financial hardship, unless the hardship is temporary. Financial hardship may include the following: 

(1). Have lost eligibility or are awaiting eligibility determination for a federal, state or local assistance program, including a family having a noncitizen household member lawfully admitted for permanent residence and who would be entitlted to public benefits but for Title IV of the Personal Responsibility and Work Opportunity Act of 1996;
(2) Woud be evicted as a result of the imposing the minimum rent requirement;
(3) Experience income decreases because of changed circumstances including the loss of employment;
(4) have a death in the family; or
(5) have other circumstances as determined by the PHA or HUD
(b)  Any requests made for a hardship exception will be reviewed and implemented by the BHA in accordance with the regulation as cited above. 

8.8.4    Maximum Subsidy 

The maximum subsidy the BHA can pay in the HCVP is the Payment Standard minus the TTP. The BHA sets a Payment Standard in the range from 90% to II0% of the current HUD Fair Market Rent or at any exception Payment Standard amount approved by HUD. The maximum subsidy calculation is done at the time the Family is issued a Voucher. It is important for the Family to know the maximum the BHA will pay while searching for a Unit. The actual BHA subsidy can be calculated only after the family has selected an Apartment. 

8.8.5    Tenant payment to Owner 

(a)        The Family is responsible for paying the Tenant Share of Rent (Total Tenant Payment minus the Utility Allowance).    

(b)        The amount of the tenant rent as determined by the BHA is the maximum amount the Owner may accept as payment from the Family. The Contract Rent is payment for all housing services, maintenance, equipment, and utilities to be provided by the Owner without additional charge to the tenant, in accordance with the HAP Contract and lease.

(c)        The Owner may not demand or accept any rent payment from the tenant in excess of the Tenant Share of Rent as determined by the BHA. The Owner must immediately return any excess payment to the tenant.    

(d)        The Family is not responsible for payment of the portion of the Rent to Owner covered by the housing assistance payment under the HAP Contract. The Owner may not terminate the tenancy of an assisted Family for non-payment of the BHA housing assistance payment.     

8.8.6    Limit of BHA responsibility

(a)        The BHA is responsible only for making housing assistance payments to the Owner on behalf of a Family in accordance with the HAP Contract. The BHA is not responsible for paying the Tenant Share of Rent, or for paying any other claim by the Owner.

(b)        The BHA may not use housing assistance payments or other program funds (including any administrative fee reserve) to pay any part of the Tenant Share of Rent or to pay any other claim by the Owner. The BHA may not make any payment to the Owner for any damage to the Unit, or for any other amount owed by a Family under the Family's Lease or otherwise.

8.8.7    Utility reimbursement

(a)        If the amount of the Utility Allowance exceeds the Total Tenant Payment, the BHA shall pay the amount of such excess as a reimbursement for tenant-paid utilities (Utility Reimbursement) and the Tenant Share of Rent shall be zero.  

(b)        The BHA either may pay the Utility Reimbursement to the Family or may pay the utility bill directly to the utility supplier on behalf of the Family.

(c)        If the BHA chooses to pay the utility supplier directly, the BHA must notify the Family of the amount paid to the utility supplier. 

8.9       Error Correction 

8.9.1    Mistake discovered after Lease signed 

If the BHA or the Participant discovers a mistake in the rent calculation after the Lease is effective and a correction will cause the Family an increase in rent, the Leasing Officer will notify the Family in writing thirty (30) days before making the adjustment. If the BHA or the Participant discovers the mistake after the Lease is effective and the correction reduces the Tenant Share of the Rent, the Leasing Officer will make the necessary correction effective retroactively. The Leasing Officer will notify the Family and Owner in writing of the error and the correction. 

8.9.2    Retroactive only when BHA is at fault 

The BHA will only make a retroactive payment when the BHA is responsible for making a mistake. The BHA will not make retroactive payments when the Owner or the Family is responsible for intentionally or unintentionally withholding information.