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Administrative Plan 7/1/2025 Page 17-88 <br />17-VIII.D. REASONABLE RENT [24 CFR 983.301(d) and 983.303] <br />At the time the initial rent is established and all times during the term of the HAP contract, the <br />rent to owner for a contract unit may not exceed the reasonable rent for the unit as determined by <br />the PHA, except where the PHA has elected within the HAP contract to not reduce rents below <br />the initial rent under the initial HAP contract. <br />When Rent Reasonable Determinations Are Required <br />The PHA must redetermine the reasonable rent for a unit receiving PBV assistance whenever any <br />of the following occur: <br /> There is a 10 percent or greater decrease in the published FMR in effect 60 days before the <br />contract anniversary (for the unit sizes specified in the HAP contract) as compared with the <br />FMR that was in effect one year before the contract anniversary date; <br /> The PHA approves a change in the allocation of responsibility for utilities between the owner <br />and the tenant; <br /> The HAP contract is amended to add a contract unit or substitute a different contract unit in <br />the same building or project; <br /> The PHA accepts a completed unit after development activity that is conducted after HAP <br />contract execution in accordance with 24 CFR 983.156(b)(3); and <br /> There is any other change that may substantially affect the reasonable rent. <br />The PHA must determine reasonable rent in accordance with 24 CFR 983.303. <br />Rent Floor <br />The rent to owner for each contract unit may at no time exceed the reasonable rent, except in <br />cases where the PHA has elected within the HAP contract not to reduce rents below the initial <br />rent to owner, and upon redetermination of the rent to owner, the reasonable rent would result in <br />a rent below the initial rent. However, the rent to owner must be reduced in the following cases: <br /> To correct errors in calculations in accordance with HUD requirements; <br /> If additional housing assistance has been combined with PBV assistance after the execution <br />of the initial HAP contract and a rent decrease is required pursuant to 24 CFR 983.55; and <br /> If a decrease in rent to owner is required based on changes in the allocation of the <br />responsibility for utilities between owner and tenant. <br />If the PHA has not elected within the HAP contract to establish the initial rent to owner as the <br />rent floor, the rent to owner shall not at any time exceed the reasonable rent. <br />SAHA Policy <br />SAHA will elect within the HAP contract not to reduce rents below the initial level, with <br />the exception of the circumstances listed in 24 CFR 983.302(c)(2). If, upon <br />redetermination of the rent to owner, the reasonable rent would result in a rent below the <br />initial rent, SAHA will use the higher initial rent to owner amount. <br />EXHIBIT 1