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What is RAD? 

In 2012, Congress authorized the Rental Assistance Demonstration (RAD) to test a new way of meeting the large and growing capital improvement needs of the nation’s aging public housing stock, as well as to preserve projects funded under HUD's “legacy” programs (Rental Supplement, Rental Assistance Payment, and Moderate Rehabilitation).  Properties “convert” their assistance to long-term, project-based Section 8 contracts. These new contracts provide a more reliable source of operating subsidy that allow PHAs and owners to safely leverage private capital – typically debt and equity – in order to finance the property rehabilitation or replacement. The contracts as well as underlying use restrictions must be renewed each time they expire, ensuring the long-term affordability of the improved properties.

Current and future residents are provided a robust set of rights and protections, including the consultation during the conversion process, the right to return to the property when repairs are completed, the right to organize and funding for organizing, and a right to move with tenant-based assistance if needed to move closer to a job, school, family, or other reason. Further, HUD requires that a public or non-profit entity must always maintain a controlling interest in the property, even in the rare and unanticipated event of foreclosure, thus ensuring the long-term public stewardship of the properties.

RAD Evaluation Interim Report released (9/21/16)

New research released by the U.S. Department of Housing and Urban Development (HUD), conducted by Econometrica Inc, examines how RAD is performing and provides evidence that the program is on track to accomplish its primary goal of attracting substantial new capital to stabilize the physical and financial conditions of public housing properties significantly improving housing conditions for low-income residents.   See:

Update on RAD Expansion:

On April 21st, the Senate Appropriations Committee approved the FY2017 Transportation, Housing and Urban Development, and Related Agencies Appropriations Bill that would fund a FY2017 budget for HUD that would achieve needed program goals.

  • HUD’s FY17 Budget Request included an elimination of the cap on the number of public housing units that could convert under RAD, in part to eliminate burdens on PHAs that derive from any cap, such as the allowance for only a single 9% LIHTC application attempt. The Senate Appropriations Committee approved an increase of the cap on the number of public housing units that could convert under RAD to 250,000.
  • HUD’s request to expand the second component of RAD to include the cost neutral conversion of properties assisted by Section 202 Project Rental Assistance Contracts (202 PRACs) was fully adopted by the Appropriations Committee;
  • HUD requested $50 million to provide incremental subsidy above current funding levels to Public Housing and Section 202 PRAC conversions. The Committee’s approval would make $4 million available to provide incremental subsidy, above their current funding levels, to Section 202 PRAC conversions.
  • The Bill also includes other provisions to strengthen tenant rights and clarify eligibility for certain properties under the second component, as well as standardize the ownership and control requirements for public housing conversions.

Final legislation will be determined by the Senate and House in the formulation of the final FY 2017 budget bill for HUD.


 

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