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Administrative Plan 7/1/2025 Page 17-14 <br /> Replacement Units: Newly constructed units developed under the PBV program are also <br />considered excluded units if the primary purpose of the newly constructed units is or was to <br />replace units that meet the criteria listed above. The newly constructed unit must be located <br />on the same site as the unit it is replacing; however, an expansion of or modification to the <br />prior project’s site boundaries as a result of the design of the newly constructed project is <br />acceptable as long as a majority of the replacement units are built back on the site of the <br />original project and any replacement units that are not located on the existing site are part of <br />a project that shares a common border with, are across a public right of way from, or touch <br />that site. In addition, in order for the replacement units to be excluded from the program and <br />project caps, one of the following must be true: <br />- Former residents of the original project must be provided with a selection preference that <br />provides the residents with the right of first occupancy at the PBV newly constructed <br />project when it is ready for occupancy; or <br />- Prior to the demolition of the original project, the PBV newly constructed project must <br />have been identified as replacement housing for that original project as part of a <br />documented plan for the redevelopment of the site. <br />17-I.F. PHA-OWNED UNITS [24 CFR 982.4 and 983.57] <br />For PHA-owned units (as defined in 24 CFR 982.4), an independent entity (as defined in 24 CFR <br />982.4) must perform the following functions: <br /> Determine rent to owner, including rent reasonableness and calculating any rent adjustments <br />by HUD’s Operating Cost Adjustment Factor (OCAF) (where applicable), in accordance <br />with 24 CFR 983.301 through 983.305; <br /> Perform unit inspections in accordance with 24 CFR 983.103(g); <br /> When the owner carries out development activity or substantial improvement, the <br />independent entity must review the evidence and work completion certification submitted by <br />the owner and determine if the units are complete in accordance with 24 CFR 983.156; and <br /> Determine whether to approve substantial improvement to units under a HAP contract in <br />accordance with 24 CFR 983.212. <br />The PHA may only compensate the independent entity from PHA ongoing administrative fee <br />income (including amounts credited to the administrative fee reserve). The PHA may not use <br />other program receipts to compensate the independent entity for its services. The PHA and <br />independent entity may not charge the family any fee for the appraisal, or the services provided <br />by the independent entity. <br />EXHIBIT 1