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Rental Assistance Demonstration (RAD)

RAD was created to give public housing authorities (PHAs) a powerful tool to preserve and improve public housing properties and address the huge nationwide backlog of deferred maintenance. RAD also created new preservation opportunities based on long-term assistance contracts that facilitate the financing of improvements, to assist owners of properties participating in seven other HUD programs, three of which are currently active (Section 8 Moderate Rehabilitation, Moderate Rehabilitation Single Room Occupancy, and Section 202 Project Rental Assistance Contracts). Properties assisted through the Section 811 Project Rental Assistance Contracts and Senior Preservation Rental Assistance Contracts will be able to convert through RAD upon publication of implementing guidance. Properties previously assisted through the Rent Supplement and Rental Assistance Payments programs have all converted, so those programs no longer exist.

Five Things You Should Know About Public Housing Conversions
  1. RAD allows PHAs to leverage public and private debt and equity in order to reinvest in the public housing stock. The backlog of public housing capital needs is estimated to be $115 billion when analyzing the approximately 300 RAD transactions that closed over the last three years.
  2. In RAD, units move to a Section 8 platform with a long-term contract that, by law, must be renewed in perpetuity. A Use Agreement is also recorded under RAD further enforcing HUD’s long-term interest. This ensures that the units remain permanently affordable to low-income households.
  3. Residents benefit from a right of return, a prohibition against re-screening, and robust notification and relocation rights. Residents continue to pay 30% of their adjusted income towards the rent, maintain the same basic rights as they possess in the public housing program, and gain a new option to request tenant-based assistance if they wish to subsequently move from the property.
  4. RAD maintains the ongoing public stewardship of the converted property through clear rules requiring ongoing ownership or control by a public or non-profit entity.
  5. RAD is highly cost-effective, relying on shifting existing levels of public housing funds to the Section 8 accounts as properties convert.

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