HUD Revises the Release of Change 4 to Handbook 4350.3 REV-1

Members | August 29, 2013

A revised transmittal for HUD Handbook 4350.3, REV-1, Change 4 dated Nov 27 was posted to HUDCLIPS on Dec 10. The transmittal provides a list of changes included in Change 4 including those changes incorporated in this new release, with a slightly delayed implementation timeframe. The December 10 revised transmittal, beyond addressing to concerns based on the initial August transmittal, also has additional changes.

A revised transmittal for the U.S. Department of Housing and Urban Development (HUD) Handbook 4350.3, REV-1, Change 4 dated Nov 27 was posted to HUDCLIPS on Dec 10.  

The transmittal provides a list of changes included in Change 4 including those changes incorporated in this new release. The December 10 revised transmittal, beyond addressing to concerns based on the initial August transmittal, also has additional changes.

Delayed Implementation Period

HUD announcements made via the RHIIP listserv (copy circulated immediately via the LeadingAge Housing Management Listserv) stated, "In response to Multifamily Housing's business partner requests for a handbook implementation period, the Department is delaying the implementation of the requirements found in Change 4 until December 15, 2013.  

Owners/management agents will also have until March 1, 2014, to implement any change that requires modifications to TRACS software."   

This delayed implementation date, while (this time) ultimately not substantial, was initially actually set when the need for transmittal clarification/revisions were being discussed, with an expected release date of late October or early November.   

Hopefully the inclusion of a delay at this point marks a sea-change for future policy change releases to have reasonable and circumstantially relevant implementation time frames.

Removal and Renumbering of Appendices

In addition to the revised implementation period, the revised transmittal identifies the removal of all appendices associated with Chapter 9 of HUD Handbook 4350.3 REV-1, Change 3.These include: Appendix 7-A, Appendix 7-B, Appendix 9, Appendix 10 A, Appendix 10 B, Appendix 10 C, Appendix 10 D, Appendix 11, Appendix 12, and Appendix 13. As a result, the appendices have been re-numbered.

Appendix 1 - The Affirmative Fair Housing Marketing Plan still links to the current form which expired 8/31/2013.  HUD has not yet posted a new version of this form.

Appendix 3 was updated to: 

  1. Include a new column "Provided by Applicant" under Third Party Verification.
  2. Include a Note referencing examples & requirements in 5-13.B.1 (refers to adding UIV and the order of acceptable verifications.
  3. Update Appendix 3 to align with new verification techniques in 5-13, including self-declaration of income items.

The Section 8 Fact Sheet (now Appendix 7B) is the current September 2010 version of the Fact Sheet.

Additional Changes

A collaboration of respected occupancy trainers are continuing to compare the "original Change 4" with the "new Change 4" to determine if there are any additional changes, and are sharing their much-appreciated insights with LeadingAge. Highlights so far include:

And, a small clarification to verification techniques was made in paragraphs 5-13.B-1-b-2 and 9-10.A. While the changes to Chapters 5 and 9 are minor, they have significant impact when owner/agents are verifying employment income and Social Security income.

More details will be shared on this as they become available. Members are encouraged to send in questions to cbloom@leadingage.org as they arise. A number of meetings are coming up in early January to discuss further the implications of the additional changes, continued need for extended timeframes for implementation, and to identify more clearly specific  elements of the March 1 TRACS-software related implementation.

Background: "Original Change 4"

On August 22, 2013, HUD announced it had posted Change 4 to HUD Handbook 4350.3 REV-1 "Occupancy Requirements of Subsidized Multifamily Housing Programs."   

The full 772-page handbook has been updated to include information from previously issued guidance on:

  • Use of the Enterprise Income Verification (EIV) system.
  • Violence Against Women Act (VAWA) requirements.
  • Supplemental Information to Application for Federally Assisted Housing.
  • Rent Refinement of Income and Rent Determination Requirements in Public and Assisted Housing Programs; Final Rule.
  • requirements relating to admission of individuals subject to State lifetime sex offender registration. 

The transmittal outlines the specific areas where the changes have been incorporated. As indicated in the transmittal, “changes are designated by an asterisk (*) at the beginning and ending of the change, and the page will show 8/13 as the date. The last major update, Change 3, was in July 2009.

A major notable changes is that the old Chapter 9 was omitted completely.  

The new Chapter 9 focuses on Enterprise Income Verification (EIV). And, elements of the old chapter related to excess income now reside solely in HUD's asset management handbook 4350.1, and elements related to special claims are covered within the special claims guide.

Because LeadingAge, working in collaboration with others, was able to identify a number of small but significant changes requiring updates to existing TRACS software (changes ARE coming, just not yet available), confusion regarding changes in language about the student rule, and impacting certain operational norms, HUD indicated during our phone call with us on August 29 that communications will be issued shortly to clarify concerns and to provide specific timeframes for software-related implementation delays.   

This communication will be shared across our LeadingAge Housing Management listserv as soon as it is available.