October 2002 Owners Update

Owner Update "Question Of The Month"

What is the "Renting to Relatives" rule?"

In 1997, Congress passed legislation that dealt with the issue of Owners who were related to Tenants assisted under the Section 8 program. HUD took the decision of Congress, and wrote it into the language known as the "Renting to Relatives" rule. The rule says the following:

"Effective June 17, 1998, a housing authority cannot approve a unit if the owner is the parent, child, grandparent, grandchild, sister or brother of any member of the family, unless approving the unit would provide reasonable accommodation for a family member with disabilities."

Why did Congress make this rule? Some citizens had complained that taxpayer dollars should not be used to subsidize units where there existed a close familial relationship between the Owner and Tenant. Some examples were discovered where Owners had a number of assisted units filled with Tenants who were in some way related to them, resulting in a "60 Minutes" type expose. The situation was depicted to be an arrangement to line the pockets of the Owner more than to legitimately extend housing assistance to
those who needed it. As a result Congress took action.

What is meant by the "reasonable accommodation" clause? When Congress made this rule, they recognized that there were situations where a familial relationship would be OK, and even desirable. A good example would be an adult with a physical or mental disability who is capable of living on his/her own if he/she had supervision. In that case a family member might own a property nearby where the disabled individual would live and could be easily checked on. In this case the Owner fulfills a need to care for the disabled family member. The disabled individual is able to live independently with some supervision in affordable housing without bankrupting his/her family.

Does TMHA ever grant this rule exception? Yes, on a case by case basis, if asked by the Owner and Tenant to consider such a request. First we verify that there is a disabled family member, and then ask for an explanation as to why the accommodation is needed.

How does TMHA guarantee that this rule is followed? The role of the housing authority is to inform both the Tenant and Owner of this rule. The role of the Owner and Tenant is to disclose a relationship, if it exists. Not to do so is to commit program fraud. The rule is posted in the TMHA office. Tenants are informed before they enter the program and at each recertification. In the case of Owners, the rule is included on the Request for Tenancy Approval form that the Owner must read and complete. TMHA also uses other opportunities to inform Owners such as this newsletter and the TMHA website: ( www.tuscarawasmha.org)

What about units under assistance with a related Owner and Tenant when the Rule was enacted? Those units were "grandfathered," meaning that they could continue to be assisted on the program without change. However, in the case the Tenant moves, or if the unit is sold, the new Owner cannot be a relative as defined under the rule, unless the reasonable accommodation clause applies. For questions about this rule, contact TMHA at 308-8099 to discuss your concerns.

$86,400 A Day

Imagine there is a bank which credits your account each morning with $86,400. Carries over no balance from day to day, allows you to keep no cash balance, and every evening cancels whatever part of the amount you had failed to use during the day. What would you do? Draw out every cent, of course! Well, everyone has such a bank. Its name is TIME. Every morning, it credits you with 86,400 seconds. Every night it writes off, as a loss, whatever of this amount you have failed to invest to good purpose. It carries over no balance. It allows no overdraft. Each day it opens a new account for you. Each night it burns the records of the day. If you fail to use the day's deposits, the loss is yours. There is no going back. There is no drawing against the "tomorrow". You must live in the present on today's deposits. Invest it so as to get from it the utmost in health, happiness and success! The clock is running. Make the most of your time. Seize the day!

Author: Unknown