Item HA 03 - Update to the Housing Choice Voucher Administrative Plan

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Administrative Plan 7/1/2025 Page 17-46 Term of HAP Contract [24 CFR 983.205, FR Notice 1/18/17, and Notice PIH 2017-21] The PHA may enter into a HAP contract with an owner for an initial term of no less than one year and no more than 20 years for each contract unit. The length of the term of the HAP contract for any contract unit may not be less than one year, nor more than 20 years. SAHA Policy The term of all PBV HAP contracts will be negotiated with the owner on a case-by-case basis. The Housing Opportunity through Modernization Act of 2016 (HOTMA) changes the limitation on the initial term of the HAP contract from 15 years to 20 years. For PHAs and owners with HAP contracts in effect prior to the implementation of this provision of HOTMA (April 18, 2017), if contracts are still in the initial term, the term may be extended to a maximum initial term of 20 years by mutual consent, and then may subsequently be extended for additional 20 years, for a maximum of 40 years. PHAs and owners with HAP contracts that are no longer in the initial term may mutually agree to extend the contract for total extension term of 20 years. The PHA and owner may agree at any time before expiration of the HAP contract to execute one or more extensions of the HAP contract term, but the following conditions apply:  Each extension executed must have a term that does not exceed 20 years;  At no time may the total remaining term of the HAP contract, with extensions, exceed 40 years;  Before agreeing to an extension, the PHA must determine that the extension is appropriate to continue providing affordable housing for low-income families or to expand housing opportunities; and  Each extension must be on the form and subject to the conditions prescribed by HUD at the time of the extension. SAHA Policy When determining whether or not to extend an expiring PBV contract, SAHA will consider several factors including, but not limited to: The cost of extending the contract and the amount of available budget authority; The condition of the contract units; The owner’s record of compliance with obligations under the HAP contract and leases; Whether the location of the units continues to support the goals of deconcentrating poverty and expanding housing opportunities; and Whether the funding could be used more appropriately for tenant-based assistance. EXHIBIT 1