REAC Implementing Use of New "RAPID" Software

REAC Implementing Use of New "RAPID" Software

How Will This Affect Owners and Managers?
Over the last six months, a series of changes have been working their way through the UPCS and REAC Inspection Processes, and a large percentage of the changes relate to the implementation of the new "RAPID" software that REAC Inspectors are supposed to use. There has been a lot of outreach by REAC and HUD to Owners and Mangers to make them aware of the new software.

The following are the questions that are presented to us by our clients and industry representatives about RAPID and how it changes the REAC process for Owners and Mangers.

Do I have to Use the RAPID Software Myself?
No, there is no requirement to use the RAPID software by owners and managers, and most who have used it find the product to be incongruent with "what managers do". In short, it appears to be an improved platform for REAC Inspectors as compared to the aging software they were using for years, but it is designed to make the REAC inspection process more accurate and not necessarily to allow owners and managers to conduct UPCS inspections easily.

The public version of the software can be cumbersome to install; often requiring an initial call to REAC to allow for access to the HUD's systems. The RAPID software uploads and maintains all data collected during any inspections that are completed using it (including internal annual UPCS inspections) to HUD's master database - this sharing of internal UPCS inspection data is something we have heard owners and managers express some discomfort with.

Moreover, RAPID is a software to implement the UPCS Inspection code precisely as stated by REAC, with the design of the software focused on the aims of REAC as an agency (i.e. scoring violations, rating properties, collecting survey information), and does not include some of the areas that most concern owners and managers, such as damaged amenities (blinds, shades, etc) and housekeeping and lease enforcement concerns.

How Does This Change the Actual Inspection?
The most dramatic change is how inspection items are recorded and listed on the inspection report. In the prior REAC Software, each inspection item was only noted once per inspection, and additional occurrences of the same issue would be clarified in a note if the item was a Level 3.

With RAPID - Items will be noted separately on the report, but there will still be just one point deduction. For example, on the old software, the inspector could see several doors in a unit with damaged hardware, but the only door that would appear on the report would be the Entry Door (for example) as it was the most "severe", now all of the doors will appear, though only the points for the most severe item will be deducted.

This will affect how appeals are viewed as well, as previously the additional items that the inspector viewed were essentially "unknown" on the report, and now the additional items in the same inspectable item category are shown on the report and would need to be appealed along with the main item in order for a point change to be granted. For example:

  • Two Bedroom Unit - one of the bedroom doors has a hole over 1/4 inch in diameter in the door and the bathroom door has a hole greater than 1 inch. For the purpose of the scoring, the only point deduction will be the bathroom door -- if you were to appeal that door successfully, the item would be removed and then the point deduction would essentially change from Level 3 to Level 2, as the bedroom door violation would essentially take the bathroom doors' place.

Why Did My Inspection Take So Long to Complete?
Our clients and industry partners who have experienced a REAC Inspection with an inspector using the new software frequently ask us why inspections that were relatively quick take so long now.

The new software requires much more detail and each violation includes a detailed section where the inspector can provide insight onto what he or she saw when they cited the violation. The software is "new" and the inspectors are getting used to it, so any inspection in the next few months should be anticipated to take a little longer than those in the past.

If you should have any questions regarding REAC Inspections, REAC Appeals, or how US Housing can assist you in preparing or creating an effective appeal, please contact Dan Biron at 603-223-0003 ext 103.

2013 HOME Income Limits Published

The 2013 HOME income limits have been published and are effective March 15, 2013. You may access these limits from the HOME Program Income Limits Page. The 2013 HOME rent limits will be published soon. Please continue to use the 2012 HOME rent limits until the 2013 rents are published and become effective.

Compliance X-Files

A Monthly Journal of the Most Interesting Compliance Files

When Is Rent Assistance Considered Income?
This month we received a Move In file for approval for a property with HOME and Tax Credit funds, and the applicant was a single 22-year-old woman with two dependent children. The family states on their application that they receive nominal cash contributions from a family member for the cost of living expenses and a local charity has agreed to subsidize her rent with rental assistance paid directly to the landlord. When the manager created the Move In TIC; the only source of income included was the cash contribution from a family member.

According to the 8823 Audit Guide, the correct method, in this case, would be to count the amounts received as "rental assistance" from the local charity as a recurring contribution to the household - essentially the same as the gifts they receive from family members outside the household.

"The law at issue is IRC 42(g)(2)(B)(i), which says: (2) Rent-restricted units (B) Gross rent. For purposes of subparagraph (A), gross rent - (i) does not include any payment under Section 8 of the US Housing Act of 1937 (42 USCS §1437f) or any comparable rental assistance program (with respect to such unit or occupants thereof). Additionally, the explanation in the Form 8823 Guide (page 11-5) is as follows: The gross rent limit applies only to payments made directly by the tenant. Any rental assistance payments made on behalf of the tenant, such as through section 8 of the United States Housing Act of 1937 or any comparable Federal rental assistance, are not included in gross rent. Congress further intended that any comparable state or local government rental assistance not be included in gross rent. See IRC §42(g)(2)(B)(i) and the General Explanation of the Tax Reform Act of 1986.

The rent paid by the local charity is not considered a "rental assistance payment" because the local charity is not a Federal, state or local rental assistance program. Therefore, the payments are considered income to the tenant (regular, recurring monetary contribution to residents)."

If you should have any questions about this rule or about how US Housing can help you with compliance issues, please contact Judy Varrill at 603-223-0003 ext 107. 

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