Proposed Reforms from REAC Listening Session
We had the opportunity to attend a listening session with REAC at the NLHA conference in January. At this session, REAC provided a high-level list of goals and intentions that are planned to be executed starting this year. The overall aims of these reforms were to address what was stated as a practice of “preparing for the exam”, instead of focusing on ensuring that all units and properties were in a constant state of full readiness and compliance.
Proposed REAC Reforms from January 2018 Listening Session
14 Day Notice for REAC Inspections
This is the element of the reform plan with the greatest likelihood of being enacted this year. Likely, sooner rather than later. Firstly, this change would mean that after the anniversary date, the property could be notified at any time of inspection and given limited time to prepare. Secondly, it means that rescheduling or seeking a negotiated date would not be entertained, other than possibly until the following week. The logistics of this change could change the way that inspections are assigned to contract REAC Inspectors, however, the logistics are likely to take some time to work out. However, it was very clear that a form of this initiative will be in the future.
REAC Inspection Scoring Proposed Reforms
There is a proposal to change the overall nominal value to 50% of the score for dwelling units – this number is currently 35%. The other four inspection areas would be combined into two areas to “simplify” the code. Building Exteriors, Site, and outdoor Common Areas and Systems would be combined to “Outside” and interior Systems and Commons to “Inside”. It was unclear how this reform would make the process easier; as the underlying concept of inspection “what something is, not where it is” is still part of any competent inspection.
In our opinion, the change in the overall unit value to 50% is a good idea. If the rest of the scoring is left as it is today, it would result in reducing outsized penalties for small site and systems infractions and increase the emphasis on dwelling units. This could be done immediately with a simple adjustment to the existing scoring model.
An initiative to develop software for the properties to do their annual inspections was discussed. This software would upload the data to HUD for “analysis of the data”. Firstly, it is not clear what this software would look like. Secondly, what would happen in the event an owner failed to comply. Thirdly, who would develop the software. The feedback from the audience on this discussion stated that it was unclear what this would accomplish. Many pointed out that owners and managers would be unlikely to upload results to HUD which showed negative results. Even if HUD provided assurances that the data would not be used against them.
Other than the changes that relate to changing the scoring emphasis on dwelling units, the overall reaction from the owners and managers present was that this proposed approach is a means of complicating an established and functioning system to address 2-3% of owners who attempt to manipulate the system. Many in attendance took offense at the notion that their hard-work was simply “preparing for the test”.
There is no argument for maintaining the status quo. The question is: does this system need to be completely redesigned or can it be adjusted? The overall goal of changing the inspection to emphasize unit condition is laudable. However, there was nothing provided to show what the end results would be from these changes. How it would make things easier, more transparent, and a viable option. Hopefully, future announcements would clarify how reforms will bring change.