The Tennessee Housing Development Agency is getting back in the business of visiting and monitoring federally subsidized apartment developments, and properties in Memphis will be the agency's top priority.
Starting in July, THDA will resume on-site Management and Occupancy Reviews (MORs) at multifamily properties in Tennessee that participate in the federal government's Performance-Based Contract Administration (PBCA) program, which supplements the rental income of developments that serve low-income residents.
There are 49 PBCA properties in Shelby County, some of which have been the subject of intense public and government scrutiny in recent months.
"There is no substitute for having compliance officers on the ground, physically looking through the files and seeing property conditions with their own eyes," said Ralph M.
Perrey, executive director of THDA.
The U.S. Department of Housing and Urban Development (HUD) suspended the authority of THDA and similar agencies in 41 other states to conduct MORs in September 2011 as the result of a lawsuit filed against HUD over how inspection contracts were awarded. There are 394 PBCA properties in Tennessee.
"It's a bad idea to leave these properties uninspected for years at a time, as we've seen right here in Memphis," said Mr. Perrey. "We're in the process of hiring compliance officers right now so we can resume our work as quickly as possible."
Compliance specialists will visit PBCA properties to conduct an in-depth review of files in order to confirm residency and rent restrictions are being enforced, to verify the eligibility of residents, and to take note of building conditions. THDA will then provide an assessment to HUD, which is responsible for enforcement of PBCA rules and requirements. THDA will also provide copies of assessments to City of Memphis Code Enforcement, which has access to many enforcement remedies not available to HUD or THDA.
"We're going to be helpful in alerting HUD to potential problems early on," said Mr. Perrey. "The great majority of property owners are conscientious and diligent in meeting their obligations under the program. A handful, however, have failed to do so-some, rather spectacularly. The sort of egregious violations many of you have found at some Memphis properties clearly did not arise overnight. They festered over time, even with action from the City of Memphis Department of Code Enforcement citing some of these properties dating back to 2011 and taking them to Environmental Court."
THDA is not revealing the order in which properties will be visited "so as not to ruin the surprise," according to Perrey. However, he did confirm that at least 12 properties in Shelby County will be inspected by the end of the summer.
"The City of Memphis Department of Code Enforcement and City Attorney's office has committed to continue to be a strategic partner to HUD and THDA in imposing a high level of accountability for any owners receiving subsidies to keep properties in compliance with the highest of standards," said Mr. Perrey.
Once an MOR visit is complete, a report is issued to the property owners/agents and HUD, which is solely responsible for mitigation and enforcement.