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Section 537 of the Quality Housing and Work Responsibility Act of 1998 (QHWRA) (Title V of P.L. 105-276) added a new Section 33 to the United States Housing Act of 1937 (42 U.S.C. 1437z-5). In addition, Section 533 of QHWRA amended Section 22 of the 1937 Act. Section 33 of the Act governs the required conversion of developments from the public housing stock and Section 22 of the Act governs  voluntary conversions. QHWRA also repealed the Section 202 mandatory conversion program. The term conversions in this context means the removal of public housing units from the inventory of a Public Housing Agency, and the provision of tenant-based, or project-based assistance for the residents of the public housing being removed.

Separate final rules implementing Section 537 of QHWRA covering required conversion and Section 533 of QHWRA covering voluntary conversion, were published in the Federal Register on September 17, 2003, with an effective date of March 15, 2004. These rules amend 24 CFR Part 972. Distressed public housing developments, where the cost of modernizing and operating them as public housing exceeds the cost of providing tenant-based assistance to residents, must be removed from the public housing inventory. Public housing developments that will not be viable over the long term must also be removed from the public housing inventory.

A rule addressing the methodology for comparing the cost of individual public housing developments to the cost of tenant-based Section 8 assistance was published in the Federal Register March 21, 2006 (Calculation Rule). The rule is effective April 20, 2006. The cost methodology for Required Conversion is different than that for Voluntary conversion.

A sample of a completed spreadsheet has been included as well.

If you have any questions please contact SAC Management.