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Public Housing Property Damaged or Destroyed by Casualty Loss or Natural Disaster

Damaged Property

When structures (dwelling or non-dwelling buildings) on public housing property are damaged by a casualty loss or natural disaster, a PHA may take action on the damaged structures without obtaining prior advance HUD approval under 24 CFR part 970, but only to the extent necessary to maintain the property in a safe condition.  PHAs should consult their local HUD offices of Public Housing to determine the applicable environmental review requirements, including when there are imminent health and safety risks and for activities necessary to control or arrest the effects from disasters or imminent threats to public safety.  See also https://www.hudexchange.info/resource/2926/hud-memo-environmental-review-exemptions-disasters-imminent-threats.  Neither the receipt of insurance proceeds nor a condemnation order authorizes a PHA to demolish public housing property without obtaining HUD approval in accordance with 24 CFR part 970.  The elimination of an exigent hazard generally will not require a PHA to undertake a full demolition (e.g. down to the foundation/slab) of the public housing property.  Section 13(B) of the ACC requires a PHA to promptly restore any damaged public housing property unless it obtains written approval from HUD.  Restoration generally involves the PHA repairing the damaged property with insurance proceeds, FEMA funds if eligible, HUD Capital Fund Natural Disaster Grant, other available Capital Funds or other eligible funds.  For more guidance on Capital Funds and Insurance see PIH Notices 2016-13 and 2012-48 and https://www.hud.gov/program_offices/public_indian_housing/programs/ph/capfund/emfunding

If a PHA does not plan to restore the damaged public housing property, the PHA must submit a SAC application to complete the removal and to ensure IMS/PIC records and HUD funding are accurate.  PHAs have the option of submitting a SAC application for demolition under part 970, disposition under part 970, or de minimis demolition (if otherwise eligible).  To evidence that rehabilitation is not cost-effective, in addition to a PNA or itemized list of work-items to meet the cost-test criteria of 24 CFR 970.15, HUD may require additional information such as an insurance adjuster’s claim documentation, especially when property has been severely damaged or partially demolished by a PHA to remove an exigent hazard).

If a PHA plans to demolish the existing damaged units and reconstruct the same number of ACC units on the same site, the PHA must do two things: (1) submit a SAC application for demolition (under 970 or de minimis authority); and (2) submit a development proposal to HUD in accordance with 24 CFR part 905 and its 5-year CFP Plan (the newly reconstructed replacement units will have a different DOFA date in IMS/PIC even if it retains the same project number).

Destroyed Property

When structures (dwelling or non-dwelling buildings) on public housing property are destroyed (e.g. razed to the ground and destroyed to the extent that it meets the definition of demolition at 24 CFR 970.5) by a casualty loss or natural disaster, the PHA must submit an “after-the-fact” SAC application to ensure IMS/PIC records and HUD funding are accurate.  This is required regardless of intent to reconstruct the property with replacement housing or permanently remove the property from its inventory.  PHAs have the option of submitting a SAC application for demolition under part 970, disposition under part 970, or de minimis demolition (if applicable). 

Notwithstanding that the application is “after-the-fact”, PHAs must comply with applicable demolition/disposition requirements of 24 CFR part 970 to the maximum extent feasible, especially regarding future plans for the permanent removal or reconstruction of the property. This includes environmental review requirements in accordance with 24 CFR 970.13.  For an activity to qualify as an exempt activity under 24 CFR 58.34(a)(10), it must involve a Presidentially-declared disaster or local emergency declared by the chief elected official for the Responsible Entity (RE) and be necessary to control or arrest the effects from disasters or imminent threats to public safety.  For an activity that already occurred (i.e., property destroyed by the casualty loss or natural disaster), PHAs should contact their local HUD offices of Public Housing to determine the applicable environmental review requirements.  Proposed activities must comply with certain environmental review requirements, and the Responsible Entity or HUD will generally be required to contact the State Historic Preservation Officer (SHPO) regarding any destroyed property.  In addition, an environmental review must be completed for any known planned re-use of the property (e.g. construction of a public housing replacement unit).  See PIH Notice 2016-22 for environmental review requirements for PHAs.

Relocation of Residents and Eligibility for Tenant-Protection Vouchers

If residents face an imminent health/safety risk based on damage or destruction to their units due to a natural disaster or casualty loss, the PHA should take steps to protect the residents by immediately relocating them.  Depending on the situation, the PHA may use one or more of the following to immediately relocate the residents:

  • other available public housing units (in compliance with its occupancy policy regarding mandatory moves);
  • Section 8 vouchers from its existing HCV resources (in compliance with its Section 8 Admin Plan);
  • Section 8 vouchers through an award of tenant-protection vouchers (TPVs) from HUD.[1] In cases of imminent health and safety, PHAs are eligible to apply for (and receive) TPVs from HUD immediately after they submit a SAC application.  In this case, PHAs should follow the relocation requirements of 24 CFR part 970.
  • Temporary housing (including assistance from FEMA).

If PHAs relocate residents into temporary housing or other housing that does not meet the criteria of comparable housing of 24 CFR 970, the PHA must reach out to those residents and offer them comparable housing under 24 CFR 970 as part of its implementation of the Section 18 application approval.  On a case-by-case basis, TPVs may be available for vacant units that were vacated on an emergency basis due to imminent health and safety risks.

Definition of Natural Disaster

Natural disaster is defined in 24 CFR 905.108 as “[a]n extraordinary event, such as an earthquake, flood, or hurricane, affecting only one or few PHAs, but excluding presidentially declared emergencies and major disasters under the Robert T. Stafford Disaster Relief and Emergency Assistance Act.”  Per 24 CFR 990.145, PHAs can request their local Office of Public Housing put such units into the Natural Disaster Sub-Category in PIC during the period between the date a unit becomes uninhabitable until the unit is either rehabilitated or approved for demolition and/or disposition in accordance with 24 CFR part 970, up to three years.


[1] If TPVs are being used in an area with known environmental hazards such as a Superfund or Formerly Used Defense site, this might be considered extraordinary circumstances and require an Environmental Assessment.  HUD’s approval of a Section 18 application that involves relocation and displacement of residents from occupied public housing developments requires an Environmental Assessment be prepared prior to a Section 18 approval that would enable such relocation.