fbpx

search

New Scheduling Rules for REAC Inspection Released 

HUD Released new rules for inspectors participating in the Reverse Auction Program in a document titled "UPCS Inspection Services Purchase Order Terms and Conditions". These new rules will go into effect on March 25, 2019. Much of the document deals with federal contractor payment and performance requirements for REAC Inspectors, but there are elements of this document which directly affect owners and agents of Multifamily and Public Housing Properties.

  1. Scheduling Methodology: REAC Inspectors will create a schedule of properties and the dates that the inspectors have assigned the properties prior to notifying any of the owner/agents. One of those dates will be fourteen days from the initial notification date and the second date will be a final date within seven days of the first inspection date if the first inspection is unsuccessful.
  2. Notification Procedure: REAC Inspectors must call ​the owner/agent exactly 14 calendar days prior to the inspection to notify the owner/agent of the inspection date and then send an email confirmation as well. A confirmation by the owner/agent is not required to proceed with the scheduled date.  If there is a holiday, the contractor should notify the property the day proceeding or following the holiday, thus providing a 13-day or 15-day notification to the property.
  3. Non-Compliance with Scheduling: If prior to the first inspection date, the owner/agent informs the contractor that they will not allow the inspection to go forward, the contractor will record the rejection and then should provide the second inspection date which was recorded in the schedule sent to REAC. If the owner/agent agrees to the date, the contractor should then send a new confirmation. If both inspections are refused or unsuccessful as the result of the owner/agent, the inspector is to report this to HUD, and the property will receive a score of zero, and this will be the inspection of record.
  4. Exceptions for Extraordinary Circumstances: If the owner/agent refuses the inspection dates because they are undergoing substantial rehabilitation, the REAC Inspector should inform them that unless they have received an approved waiver/postponement from HUD prior to the scheduled inspection date that the inspection must go forward as scheduled.
  5. REAC Inspector Non-Disclosure: Inspectors must sign a nondisclosure agreement and cannot disclose any information about any properties which are proposed for inspection. Though not explicitly stated, it appears that the list of properties that are part of the Reverse Auction Program will no longer be public. If any person(s) attempts to share information with you about the contents of any upcoming or current auctions, you should not accept the information.
  6. Conflict of Interest of REAC InspectorsThe language around licensed REAC Inspectors using performing consulting services was strengthened to include the following "An inspector may not inspect a property where there is any other condition, situation or relationship that exists where the objectivity of the inspector or contractor may be called into question." REAC Inspectors are also not permitted to "repair any conditions found during inspections, or endorse, recommend, or otherwise advise the use of specific individuals or business firms for such repair work". (All employees of US Housing Consultants are not currently licensed REAC Inspectors to ensure we have no conflicts of interest).

The last point reinforces a message which we frequently tell our clients - REAC Inspections are not intended to be training for owners/agents and should not be viewed as a "learning experience". Inspections should be proof of existing knowledge and good performance and not a chance to learn what is permitted and prohibited.
The document contains a lot of additional information for those who are interested, the items included above are simply the high points which will most directly affect owners/agents. Please let us know should you have any questions or comments.
Preparing for New REAC Realities: A Time to Re-Exa...
Conquering REAC Compliance Workshop in Minneapolis...

Latest Blogs

17 February 2020
REAC Inspections
  New Quality Assurance Insurance (QAI) Re-Inspection Process​Earlier this month, HUD instituted a new Quality Assurance Inspection (QAI) process, which may be done within five (5) days of the REAC inspection. Effective February 3, 2020, REAC ...
06 February 2020
HUD and Tax Credit Compliance
HUD Provides Clarification on Assistance AnimalsSixty-Percent of all Fair Housing complaints relate to the denial of reasonable accommodations and those complaints regarding the denial of an assistance animal are one of the most common...
06 February 2020
HUD and Tax Credit Compliance
    IRS Provides Long-Awaited Guidance on Determining Income Limits under the Average Income TestOn January 30, 2020, the IRS published Rev. Rul. 2020-4. This revenue ruling provided long-awaited guidance on how to compute the new incom...
06 February 2020
HUD and Tax Credit Compliance
HUD Publishes a Proposed Rule Implementing HOTMA HUD published a proposed rule implementing the provision of the Housing Opportunity Through Modernization Act (HOTMA), which was signed into law in 2016. The proposed rule contains massive c...
13 January 2020
REAC Inspections
Resident Involvement in REAC/NSPIRE Inspection Process​​As part of the NSPIRE pilot process, HUD has announced that additional processes will be added to engage the residents in the REAC/NSPIRE process. You can read the press release on HUD's website...

Blog Archive