Not more than 15 percent of units first available on or after 1 October 1981 may be leased to low income families who are not very low income, absent prior HUD approval

pbra.income_eligibility.very_low_income_admission_ceiling · v1.0.0

Not more than 15 percent of the Section 8 project-based dwelling units that initially became available for occupancy under a Housing Assistance Payments contract on or after 1 October 1981 may be leased to low income families other than families that are very low income at the time of admission; for units available under contracts effective before 1 October 1981 and leased on or after that date the ceiling is 25 percent. Except with prior HUD approval the owner may lease such units only to very low income families. An owner seeking an exception must state the basis and provide supporting data; recognised bases include an insufficient number of very low income applicants to preserve financial or management viability, an owner commitment to a broad range of incomes, supervision by a State housing finance agency pursuing broad-range occupancy, and avoiding displacement of low-income families from a Section 8 project. Granting an exception is committed to HUD's discretion and HUD may withdraw permission after periodic review. HUD Handbook 4350.3 paragraph 3-7 supplies the procedure. The two universes are handled differently: a pre-1981 property needs no exception request at all, because HUD Headquarters tracks the 25 percent restriction nationwide, while a post-1981 property must submit a WRITTEN request with the certification and documentation Exhibit 3-1 specifies to the HUD Field Office, which makes the final decision (a Contract Administrator that is not HUD gathers and forwards the documentation with its recommendation). A denial may be appealed once, by submitting additional documentation to the HUD Multifamily HUB Director within 30 days, after which there is no further appeal. An individual tenant exception may not be reused when that tenant leaves or stops receiving assistance; a project or unit exception may be reused until the Field Office recalls it or its timeframe expires. Separately, paragraph 3-7.C allows an owner in a partially assisted property to give assistance to an in-place low income tenant WITHOUT any HUD exception approval in three named situations -- conversion from RAP or Rent Supplement, eligibility arising with the sale of a HUD-owned project, and a tenant at or below the low income limit paying more than 30 percent of income toward rent.

Confidence

high

Effective from

2000-03-29

Consequence model

agency finding with cure

Last reviewed

2026-09-02