Written by Erik Whitton, Spectrum Enterprises

Yesterday 2 articles found their way to my inbox worth sharing as a careful reminder of management policies and service animals.

http://www.cdapress.com/news/local_news/article_da870541-2784-5eb9-b8df-2729a96713d3.html

http://www.nydailynews.com/new-york/feds-sue-i-co-op-threatening-evict-couple-woman-comfort-dog-article-1.1022404?localLinksEnabled=false

In the first article, a federal jury awarded $21,000 in damages after an Idaho apartment community informed prospective residents that damage deposits were required for service animals. This was deemed a Fair Housing violation as discrimination against handicap applicants. Of note, the property did not actually charge anyone a damage deposit yet still lost the case and will be forced to pay $21,000.

In the 2nd article, a co-op community in New York threatened to evict an elderly couple stating the woman’s therapy animal violated the ‘no pet’ policy at the property. The tenant in question suffered from diabetes, mental illness, and loss of vision and hearing. Under pressure from the property owner, the couple gave up the dog while she was dying. After her death the husband filed a fair housing compliant which is now a federal case. It will be interesting to follow this case as it develops. If I here anything I will post an update.

Both cases reveal property staff unfamiliar with the distinction between a ‘pet’ and a service animal. We would urge anyone reading this to check your advertising, selection criteria, lease documents, and property rules for language about pet policies and make sure all staff understands a service animal is not a ‘pet.’

These are important reminders that the judicial system does not take lightly fair housing concerns. If a compliant is valid the prosecution will be tough and the penalties severe. Al employees must be trained in Fair Housing law – this includes anyone answering phones or working on the maintenance crew all the way up to the owner. Spectrum recently announced our 2012 training schedule which includes 4 Fair Housing seminars along with our Symposium which always addresses Fair Housing and usually includes a presentation from a HUD employee who prosecutes these cases. In addition, all of our c3p Tax Credit Compliance seminars spend time discussing Fair Housing law. Any client of Spectrum Enterprises can register for the courses at a discounted rate (please mention to this to our staff when signing up). Here is a link to the 2012 schedule:

http://www.spectrumseminars.com/register/

Written by Lainey Nadeau, Spectrum Enterprises

This quote is from the IRS 8823 guide, Chapter 4 pg. 4-33. Chapter 4 deals with Category 11a of the 8823 form. This category is used to report units rented to households with incomes that exceed the income limit at initial occupancy. I find myself using this quote often when reviewing files for compliance because exhibiting due diligence and recognizing unusual circumstances is an essential part of the LIHTC program.

Owners should use due diligence… What is due diligence? Here is the 8823 guide definition as found in the footnote on pg. 4-15:

Due diligence is defined (Black’s Law Dictionary [6th ed.1990]) as: “Such measure of prudence, activity, or assiduity, as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent person under the particular circumstances; not measured by any absolute standard, but depending upon the relative facts of the special case.” In short, the due diligence standard is a judicially created test to determine the adequacy of the efforts exerted throughout all phases of any activity.

Got it? Let’s break it down. A reasonable and prudent person under the particular circumstance. This would likely be the owner/manager/staff person responsible for reviewing the application, obtaining third party verification, reviewing tenant submitted documents, obtaining clarifications and determining anticipated income. Under the particular circumstance means this person is expected to understand the LIHTC program. The owner should also be familiar with the expectations of their state’s housing finance agency (HFA) and the property’s investor. For example, the HFA may require the use of certain HFA forms, such as the TIC, application, employment verification, etc. To find the requirements in your state visit your HFA’s Web site. You can find a link to each HFA Web site at http://lihtc.huduser.org/agency_list.htm.

…not measured by any absolute standard, but depending upon the relative facts of the special case. Not all situations/files are the same. Obtaining a third party employment verification may be enough to determine income in one file while another file may require pay stubs, tax returns or telephone clarification in addition to the third party employment verification. The owner needs to be able to recognize when additional efforts are required to adequately determine income. For example an owner should obtain additional verification when a household’s income is close to the income limit, when a household member’s employment is seasonal or sporadic, or when a household claims zero income.

…adequacy of the efforts exerted throughout all phases of any activity. Due diligence must be exhibited in every stage of the LIHTC process. For example, the owner should ensure that the application, questionnaire, verification forms etc. ask the appropriate questions to gather all relevant information, including household composition, income, assets, and student status. In addition, when the owner reviews the tenant application, verification forms etc. she should check that all forms are complete and information is consistent. When questions arise additional information should be obtained and a clarification record should be in the file. When calculating income the owner should consider a variety of methods, such as calculating income based on YTD earnings in addition to straight calculation.

Example: ABC property verifies an applicant’s student status using a Student Status Affidavit and by a question on the application. Both the affidavit and the application ask the applicant if he is currently a full time or part time student and/or does he anticipate enrolling as a full time or part time student in the next 12 months. Using these verification methods does not exhibit an “adequacy of efforts” because the applicant is only questioned about current and future student status. To be eligible for the LIHTC program the applicant must also be questioned about their previous student status during any 5 months of the taxpayer’s calendar year.

Example: The owner receives employment verification (EV) where the number of hours worked per week has been crossed out and a different number written next to it. The owner can exhibit due diligence by following up with the employer and to ask why information was crossed out on the EV. A clarification record would be placed in the file stating the reason for the change. The clarification record must document the third party’s name, position and contact info; the information obtained from the third party; the name of the person who conducted the clarification and the date and time of the call (HUD Handbook 4350.3, p. 5-60-61).

Example: The head of household (HOH) listed herself and a friend as occupants on the application however the only occupant listed on the TIC is the HOH. Due diligence is exhibited in the file because the HOH completed a clarification record stating that after completing the application her friend moved out of state. The use of clarification records to explain discrepancies in the file shows that the owner understands the LIHTC program and what is adequate to demonstrate compliance.

…Owners should use due diligence by asking follow-up questions… The 8823 guide says “acceptable methods of verifying information include third party verifications, reviews of documents submitted by the tenant (such as check stubs), and tenant certifications made under penalties of perjury” (p. 4-7). Third party verification may be written or obtained through a telephone conversation with a third party contact. Written third party verification may be sent through the mail or obtained via fax, email or the Internet. Additional information regarding verification methods can be found in the HUD Handbook 4350.3.

It is often by reviewing third party documents that the need for follow up questions arises, either because the document is incomplete, or because it contradicts other information in the file. Here are some examples:

Example: Written third party EV lists an over-time (OT) rate of pay of $12/hour however the question of how many OT hours worked per week was left blank. The owner can exhibit due diligence by conducting a telephone follow up with the person who filled out the EV to determine the # of OT hours worked per week. The owner should never assume that a blank on a form means none/not applicable.

Example: Written third party employment verification lists the applicant’s regular wage of $10/hr and states he works 40 hrs/wk. The EV is filled out in its entirety and no other sources of income are stated. The applicant’s annual income based on the EV is $20,800 ($10x40x52). However, the owner sees that the applicant listed his annual income from this job as $24,000 on the application. The owner can exhibit due diligence in a number of ways. She could perform a telephone clarification with applicant and/or with the person who completed the EV or she could request additional documents from the applicant. In this case requesting a series of recent consecutive paystubs from the applicant may give a better indication of income. When requesting pay stubs the HUD 4350.3 says to, “require most recent 6-8 consecutive pay stubs; do not use check without stub” (Appendix 3, p. 8). The owner could also request the applicants previous year(s) tax return.

Example: An applicant lists the composition of her household as herself and her two minor children on the application. She is self-employed and provides her previous two years tax returns to verify her self-employment income. While the owner is reviewing her tax return he notices that no dependants are listed. The household is income eligible using the three person income limit but the applicant is not eligible using the one person income limit. The owner can exhibit due diligence by performing a telephone clarification with the applicant to ask about the dependant status of her children. He should also request proof of custody. The 8823 guide says to include children in family size who are “present in the household 50% or more of the time. If disputed, determine which parent claimed the children as dependents for purposes of filing a federal income tax return” (p. 4-3). Since the children are not listed as dependants on her tax return additional documentation is required.

Owners should use due diligence by asking follow-up questions when the income certification process reveals unusual circumstances suggesting additional sources of income.

As mentioned earlier not all files or situations are the same. Sometimes reviewing documents or speaking with the applicant is going to suggest that something isn’t adding up and that there may be additional sources of income. The owner needs to be able to recognize these unusual circumstances and exercise due diligence. Here are some examples of unusual circumstances:

Example: On the application and Asset Addendum the applicant does not list any real estate as an asset. As part of the property’s tenant selection criteria the owner obtains a credit report on each adult applicant. The credit report shows what appears to be a current mortgage. Looking back at the application the owner notices that the applicant did not list a current landlord or current rent amount. It appears that the applicant may own a home. Additional sources of income could be income from the asset or rental income. The owner can exhibit due diligence by performing a telephone clarification with the applicant and obtaining third party verification from the mortgage company, from the city property assessor, etc.

Example: An applicant claims to have zero income. She completed an Unemployed Affidavit and stated she does not anticipate working in the next 12 months. She completed a Zero Income Certification and stated she will be paying her rent, utility allowance and living expenses using her Section 8 voucher. The owner recognizes that her Section 8 voucher may pay her rent and provide her with a utility reimbursement to pay her utilities, however the voucher does not pay for her other living expenses. The owner notices that on the application the tenant listed a cell phone number and a vehicle. This suggests additional sources of income. The owner can exhibit due diligence by performing a telephone clarification with the applicant to determine how she pays for food, clothing, cell phone, gasoline, car payment, insurance etc. Remember, the 8823 guide states, “regular, recurring monetary and nonmonetary gifts or contributions to residents from persons not living in the unit must be included in income. This can include the payments of bills on behalf of a resident” (p. 4-18). If the applicant receives gifts or contributions (except for groceries) the owner should obtain third party verification from the source of the contribution.

Example: Two adults apply for an apartment on 2/8/12. The 2 person income limit is $32,000. She is employed earning $28,000 a year. He claims zero income. On the Unemployed Affidavit he says he does not expect to become employed in the next 12 months. He says his previous employment ended on 1/6/12. On the Zero Income Certification he states that his roommate will be paying the rent, utilities and his living expenses. The owner should recognize that this is an unusual circumstance. He was recently employed. The owner should follow up with the applicant to determine why he does not anticipate returning to work. The 8823 guide states that when someone “reports little or zero income, or sporadic income, owners may use estimates based on actual income earned or received during the twelve month period immediately preceding the certification” (p.4-33). The owner should obtain third party verification of his previous employment. The owner should verify if this employment was seasonal or sporadic. The owner should question if he expects to receive unemployment benefits. If he started working the HH could easily be over income. Due diligence must be exhibited.

Using a good application form and verification forms is critical. Just as critical is making sure that the owner/manager/or staff person reviewing the documents and calculating income understands the LIHTC program. Due diligence is demonstrated when all documents in a file are complete and/or the file contains a clarification record whenever They also need to understand the concept and meaning of due diligence, recognize unusual circumstances and know the appropriate way to follow up when unusual circumstances arise. With those things in place your property can avoid an 8823 Category 11a finding.

Written by Jennifer Borland, Spectrum Enterprises

Calculating annualized Year-to-Date (YTD) can be confusing. The LIHTC program requires you use the highest verified income amount. It is essential that you compare YTD earnings to the hourly wage or salary given on Employment Verifications. For some state agencies this may not be a requirement, but most investors still want the comparison done. At Spectrum we see Employment Verifications which under-report earnings or hours every day. We often recommend that at least one pay stub be provided. The last thing you want is for your investor or state agency to complete a review and find that YTD annualizes higher than hourly wage and a household is found to be over income.

In order to accurately annualize, you need to know the frequency of pay and the number of weeks included in the YTD earnings. Following are two examples using bi-weekly pay stubs.

EXAMPLE 1

An applicant has had the same job for 3 years and provided a pay stub with his application. The pay date on the stub provided is 1/20/2012 and includes pay for 1/1/2012 – 1/14/2012. How many weeks’ pay is included in the YTD on this stub?

1. 2 weeks
2. 3 weeks
3. 4 weeks

The answer is 3) 4 weeks. The easiest way to illustrate this is by counting backwards on a calendar.

Pay checks are issued bi-weekly on Fridays; I have highlighted his pay days for December 2011 and January 2012.

We know that the check received 1/20/2012 was for weeks worked 1/1/2012 – 1/14/2012; we also know that the pay check he received on 1/6/2012 and was for the weeks worked 12/18/2011 – 12/31/2011. While some of the time he is being paid for on 1/6/2012 was in 2011, the date he was paid was in 2012 and will be part of his employer’s 2012 accounting; this is the first pay check of 2012. Therefore the check received on 1/20/2012 was the second check in the bi-weekly series for 2012 and includes 4 weeks in the YTD.

As you can see from this example, you cannot simply plug dates in to a date to date duration calculator and get the correct answer. If you had used 1/1/2012 to 1/20/2012, a standard duration calculator would have told you it represents 20 days or 2 weeks (rounded down). In this case, your annualized YTD amount would have been a terrible overestimation of Jim’s income. To illustrate, let’s say the YTD earnings reported on the stub are $1,200:

1. $1,200 / 2 weeks x 52 weeks = $31,200
2. $1,200 / 3 weeks x 52 weeks = $20,800
3. $1,200 / 4 weeks x 52 weeks = $15,600

EXAMPLE 2

In June, another applicant brings in a pay stub with her application. The stub shows that she was paid on 6/15/2012 for weeks worked 5/27/2012 – 6/9/2012, also bi-weekly. When you receive her Employment Verification it states she was hired 1/30/2012. How many weeks are included in the YTD earnings on this stub?

1. 24
2. 19
3. 20

The answer is 2) 19 weeks.

Unfortunately, a common mistake we see is that the date of hire is ignored. In this situation, the applicant has not had her job for the entire year, so we’ll count the weeks from 1/30/2012 to 6/9/2012; the date she was hired to pay period end date on the stub. In a case like this, Spectrum would recommend you follow up with the employer to verify if she started working on 1/30/2012. It’s possible that was the date she accepted the position, but work (pay) didn’t actually begin.

By overestimating an applicant’s earnings you run the risk of denying eligible households or moving in households that cannot actually afford your rent. By underestimating an applicant’s earnings, you may find you have rented to people who are not income-eligible. As always, Spectrum recommends you have someone check your math and that you show your math in your files.

Written by Lois Churchill, Spectrum Enterprises

NCSHA held its annual HFA Institute last week in Washington DC. I was able to attend both the HOME and the LIHTC modules this year.

The major topic during the HOME module was the publication on December 16, 2011 of the HOME Proposed Rule. The comments period runs through February 14, 2012 so be sure to read and send comments before that date!

The Proposed Rule makes lots of changes most of which affect the Participating Jurisdictions (PJs) only so I won’t go into those here. What will affect properties directly (if the rule is approved as is currently written) include:

• Time limit to initially qualify a new HOME unit. The rule states that if a HOME rental unit is not leased to an initial income eligible tenant within a specified time the PJ must submit information about the current marketing plan and possibly a plan for more aggressive marketing. The timeframe being discussed is between 3 and 6 months. The PJ will have to repay HOME funds invested in a rental unit that isn’t initially leased within 18 months.
• Monitoring fees will no longer be prohibited. The rule will allow PJs to charge reasonable annual monitoring fees to owners of HOME rental projects to which HOME funds are committed on or after the effective date of the final rule. Existing properties will not be subject to monitoring fees as the rule is currently written.
• Physical inspections – the rule will require the PJ to inspect each HOME project at completion and during the affordability period. The frequency will change. The project will have to be inspected upon completion, at 12 months after completion, and at least once every three years thereafter. Also, the minimum standard will be UPCS if the rule passes, not HQS, except for TBRA. State or local code, if more stringent, will be the standard. The sample of units inspected may also change. For projects with one to four HOME units all buildings containing a HOME assisted tenant and 100 percent of the HOME units would be inspected. For projects with more than four HOME units at least 20 percent of the HOME units in each building but not less than four.
• HOME units in the project and one in each building would be inspected. Please note there are substantial changes developers need to be aware of regarding new construction and rehabilitation standards for HOME assisted projects/units.
• Students – please send comments about this one! HUD is proposing to use the same restrictions on student eligibility that they use for the Section 8 program. Specifically the proposed rule reads “An individual does not qualify as a low-income family if the individual is enrolled as a student at an institution of higher education, as defined under section 102 of the Higher Education Act of 1965; is under 24 years of age; is not a veteran of the United states military/ is unmarried; does not have a dependent child; and is not otherwise individually low-income or does not have parents who qualify as low-income.” This rule was adopted for Section 8 to stop otherwise dependent and/or ineligible students from receiving subsidy. There is no subsidy in a HOME assisted unit. It’s unclear why HUD wants to adopt this definition for HOME. It’s clear that student housing isn’t allowable or if it isn’t let’s make that clear. Because the majority of HOME rental units are in developments that are also subject to LIHTC rules, why not adopt the LIHTC student definitions for HOME eligibility as well? Read this section (in the definition of low-income families) and send comments.
• Income definitions – the definition of income using the Census long form will be eliminated. The definition based on the IRS definition of adjusted gross income will be revised to require that federal government cost-of-living allowances that are not include in adjusted gross income be added to the adjusted gross income of applicants for HOME assistance for the purpose of determining income eligibility. This would affect federal civilian employees or federal court employees who are stationed in Alaska, Hawaii, or outside the US. Also, for those using the chapter 5 definitions of income the proposed rule would required at least 3 months of earning documentation (e.g., wage statements, interest statements, unemployment compensation). The 3 month minimum earnings examination would codify already recommended practice.

Electronic comments on the HOME Proposed Rule may be submitted through the Federal eRulemaking Portal as http://www.regulations.gov. Electronic submission of comments is strongly encouraged over paper submission. However those may be sent to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW., Room 10276, Washington, DC 20410-0500.

The Federal Register is Volume 76, No 242, Friday, December 116, 2011, pages 78344 through 78382.

Written by Harold Tucker, Spectrum Enterprises

What is it?

An extended low-income housing commitment is the agreement between the LIHTC property owner/taxpayer and the state housing finance agency. This agreement extends the low-income housing requirements for a minimum of a full 30 years. Federal law requires a minimum of an additional 15 years of compliance for all properties with an allocation of credits from 1990 or later. Properties must comply with program restrictions (i.e. deep skewed units, qualified basis, rent restricted, etc…) embodied in this document. Remember, the ELIHC stipulates the terms on which the credits were awarded by the state and outline any special set-asides or terms to which the owner agreed in return for the credits.

As state tax credit monitors here at Spectrum we will often realize that managers believe the auditing process is over once they are done with their initial 15 years of compliance. This is not true! In most states the monitoring process continues. For example, in Massachusetts they continue on with a 3 year rotation of monitoring the LIHTC properties during the extended use period. In Connecticut they monitor all properties in their extended use period on a five year rotation. In addition, it is still required in those states that all End Of Year documentation be provided to the State Agency or Authorized Delegate (Spectrum) annually. I have seen Extended Low-Income Housing Commitments up to 99 years. If you have not reviewed your ELIHC recently (or ever) I highly recommend obtaining a copy immediately. Thank you and we will see you on the frontlines.

Written by Wil Whalen, Spectrum Enterprises

Happy New Year from Spectrum Enterprises and Spectrum Seminars!

In 2012 our illustrious leader Steve Rosenblatt will be trekking from Honolulu, to Anchorage to New York City and everywhere in between conducting his world famous seminars! For a full schedule of seminars being offered in 2012 please access Spectrum Seminar’s website HERE

Here are few reminders for you:

• The 2012 Income Limits have already been posted. You can access them HERE.
• Effective 1/1/12 Social Security will increase by 3.6%. Click HERE for more information.
• A revised Audit Guide was published in January 2011 and is available HERE.

January is the first quarter, which means your state agency will start conducting the annual inspections. Unfortunately for many of us, January also means SNOW! Do understand that inspections are scheduled in a very specific order regarding both date and time as well as location. Even if you are experiencing bad weather, it’s important that you do your best to go through with the inspection. In the most extreme cases, inspections can be postponed, but it’s in the best interest of all involved, i.e. management, tenants, inspectors, maintenance crews, etc., that inspections happen at the time and date they are scheduled.

Check our site often for news and updates regarding the world of tax credits and stay tuned for details regarding this year’s Symposium that will be held in November in Washington DC!

We here at Spectrum hope that you had a great holiday season and we welcome you to join us for a fantastic 2012!

Written by Erik Whitton, Spectrum Enterprises

In a move that shocked the world, HUD announced the 2012 income limits on November 30, 2011. The limits have an effective date of December 1, 2011 and must be implemented by all tax credit sites no later than January 14, 2012. The shocking aspect of this is the timing; new limits are not typically published until February/March or even as late as May 31 (for the 2011 limits).

Since the most recent income limits were announced May 31 and implemented by July 15 many affordable housing professionals are surprised at the timing of this announcement since the current limits have been in place for such a short period of time.

In a recent blog post (see #6) I was critical of HUD waiting until May 31 to announce income limits. I personally applaud this latest move by HUD. If a site can enter the new year knowing what their income limits and corresponding rent limits are that makes it much easier to complete budgets and plan for rent increases. The new year is always a great time to make any needed changes such as changes to the tenant selection criteria or media advertising that may list the income restrictions.

As I have started to work with some sites across the country I have found that many areas have had an increase in their income limits. This, too, is good news as it expands the pool of applicants who can live in affordable units. Additionally, since all SS and SSI recipients are receiving a 3.6% cost of living adjustment for 2012 the income limit increase comes at a good time as we may not need to see retired seniors or people with disabilities denied affordable housing because they are getting their first benefit increase in 2 years.

My advice to all housing professionals is to immediately check for an increase for your sites. If the income limits in your area have increased go back through any files denied over the past few months to see if any slightly over income households may qualify under the new limits.

To find your 2012 income limits visit this site (and make sure to bookmark it!): http://www.huduser.org/portal/datasets/mtsp.html

• Choose FY2012 MTSP Income Limit Documentation System then click on the grey button on the next page.
• On the next page choose your state and then your county or city.

• The result will look something like this:

• Depending on the place in service date for your project you will use either the HERA special limits (top chart) or the FY (Fiscal Year) limits on the bottom chart.

HUD provides the 50% and 60% income limits. HUD does not provide rent limits or limits for lower set asides such as 40%. Spectrum has created an Excel spreadsheet to accomplish this.

After you download the spreadsheet you can enter the placed in service date for your project; the State; the city/town/county; and then you enter the 50% income limits from the HUD page into the yellow shaded line in the spreadsheet. Formulas written into the spreadsheet will calculate the 40% and 60% income limits along with all corresponding gross rent limits.

As a final note, we always suggest updating your utility allowances at the beginning of the year or when new income limits are published.

For any questions about this spreadsheet or anything else related to 2012 income limits please contact our staff.

Written by Wil Whalen, Spectrum Enterprises

The process of verifying income for a household at the first annual certification actually begins at move-in. When verifying income at the initial occupancy it’s important that you document all anticipated changes in a tenant’s income. Explore all possibilities by asking questions and making sure all third party verifications are complete. Do more research and follow up if needed. This way, if a tenant goes over the income limit at first move-in, you can show you performed your due diligence.

The most common reason for a tenant to go over the income limit at the first annual certification is because of a change in circumstances at their place of employment. Changes such as an increase in hours or pay, a raise, a bonus, a commission or tips, etc. This is why it’s important to perform your due diligence when verifying employment income at move in. When you receive the employment verification from the employer, review it carefully. Make sure the verification is complete. Also make sure that all the questions are answered and detailed enough to give you not only a picture of the tenant’s current income, but a picture of what their income will be for the next 12 months. If you have any questions at all regarding the information provided by the employer give them a call. Document this conversation and put it in the file. Feel free to request paystubs from the tenant if you are dealing with an uncooperative or unavailable employer. Make sure the pay stubs and the employment verification paint the same picture of the tenant’s income.

Often the employer leaves blanks or writes down vague information on the verification. This is where a telephone conversation comes in handy. Discussing the questions on the verification with the employer often leads to more detailed and direct information. The employer may write “N/A” on the verification in the space where it asks them to list any anticipated change in the employee’s rate of pay within the next 12 months. “N/A” doesn’t answer the question. Call the employer. The employer may tell you that the tenant is not going to receive a raise because at the time of your conversation with them it does not seem likely. However, a few months later, circumstances may change and the company may give the employee a raise. You performed your due diligence and can show that this was not anticipated at move in. Remember, this applies to every field on the employment verification, not just the anticipated raise. Year to date, tips, etc., can all result in an increase in an employee’s income. Also, pay attention to the hire date on the employment verification. If the tenant starts working one month after move in, but the hire date is just a few days after move in, chances are the tenant was aware of the job and did not report it.

When filling out the interview checklist with the tenant, stress to them that by signing it they are making the statement that everything they reported to you is true and that any misinformation or withheld information can result in tenant fraud which is punishable by law.

Remember, due diligence doesn’t end at move-in.

Written by Katie Rawson, Spectrum Enterprises

When you have an inspector coming out to your property to conduct a physical inspection management should see this as a great opportunity to walk the property and get into some units you may not otherwise enter. Often times management will stay behind during the inspection and send the inspector with only a maintenance person, who may or may not give you a good picture of how the inspection went and the condition of the units.

Bring a notepad and write down any issues you see. Ask the inspector to tell you the issues in each unit as you go. After each unit make sure you have noted the same issues as the inspector. By playing an active role during the inspection, it shows you care and the inspector will be much more likely to point out any issues to you. In addition to bringing a notepad along have maintenance bring a bucket with some extra supplies such as replacement batteries for the smoke detectors, extra smoke detectors, and some basic tools for any easy fixes along the way. This allows for some of the issues to be fixed on the spot, making less work for everyone later.

At some properties with highly organized maintenance staff they will have one or two maintenance people following the inspectors who stay behind in the unit and repair any issues found. I realize that this is not a possibility for every property but if you have some maintenance staff you can pull from a nearby property for the day it is certainly a great way to get the work down quickly and is quite impressive.

Written by Melissa Zera, Spectrum Enterprises

The stakes are high with maintaining compliance in affordable housing. Loss of credits, recapture, termination of subsidy can all be a result of mistakes caused by management moving in ineligible households or errors in recertification processing. It is critical new employees are given proper training in affordable housing. Training leads to quality performance and paves the path for development and success.

Be sure your new staff fully understands the structure of the property. It’s worth the time for a senior representative from the company to take an hour or so and discuss the development history and process of the property. At the end of the hour, they should understand how the property was funded, who the stakeholders are, how the rents are structured, any state/local/federal compliance requirements(s) and so forth.

If the property has subsidy programs such as HUD, RD or restricted rents/income like LIHTC, certification training should be scheduled with an expectation of a passing score. Seasoned managers that have had prior training should be scheduled for refresher courses as regulations are constantly changing and often forgotten.

Textbook benefits of training: Training improves morale and helps new hires feel more secure and informed which equals better job performance and satisfaction. A well trained employee will require less supervision resulting in better time management and productivity. Errors will less likely to occur with proper training. Chances for advanced promotion are increased as employees become more valuable with skills and knowledge.

Visit www.spectrumseminars.com for a list of courses offered in affordable housing.