In this Issue of the RADBlast!:

• New Tools Available for RAD/Section 18 Blends

• RAD/Section 18 Blends - Key Benefits for Small Public Housing Authorities (PHAs)

• RAD Supplemental Notice Training Materials

• The Consolidation of RAD Closing and Post-Closing Functions

• Mark your Calendars for Recap's Office Hours on RAD!

New Tools Available for RAD/Section 18 Blends

Through the recently published RAD Supplemental Notice 4C, HUD has enhanced the ways Public Housing Authorities (PHAs) can use RAD and Section 18 disposition authority together, and the Office of Recapitalization (Recap) has implemented new processes to support the RAD/Section 18 Blends. New features of RAD/Section 18 Blends include:

• The elimination of multiple Housing Assistance Payment (HAP) contracts with different rent schedules. All Section 8 assistance is now under a single RAD HAP contract with one blended rent schedule under the same rules and requirements. PHAs are now able to choose between project-based vouchers (PBVs) or project based rental assistance (PBRA) for the entire converting project based on local needs and on what makes business sense for their portfolio and operations. Go to the RAD Resource Desk for a copy of the revised RAD HAP contracts.
• The ability to produce a HUD estimate on the “blended rents” in the RAD Resource Desk early on in the conversion process, when completing the Concept Call checklist (after the Commitment to enter into a HAP (CHAP) is issued). The HUD estimate includes the boost to the contract rents that results from cancelling the Demolition-Disposition Transition Funding (DDTF) that PHAs are scheduled to receive. The rents will be finalized after the Concept Call once the PHA has provided final information on utility allowances, “Reasonable Rents,” and other data points impacting the contract rents.
• PHAs will now work directly with Recap to apply for Tenant Protection Voucher (TPV) funding. The PHA's funding application for TPVs, Form HUD-52515, should now be submitted to Recap with their RAD Financing Plan. Recap will coordinate with the Office of Housing Choice Vouchers to process the TPV funding request.

RAD/Section 18 Blends – Key Benefits for Small PHAs

An important change made to RAD/Section 18 Blends is that small PHAs - PHAs with 250 or fewer total public housing units - are now eligible for the highest blend level (90% Section 18 /10% RAD). As a result, these agencies would on average see a 43% increase in contract rents through a RAD/Section 18 Blend, enhancing small PHAs' ability to manage their assets. In addition, small PHAs now have the option to convert to a PBRA contract. This change is significant as most small PHAs do not operate a voucher program and can now sign a PBRA contract directly with HUD instead of having to identify another PHA to administer the PBV contract. Finally, the over 800 agencies with 50 units or fewer can follow the streamlined RAD conversion requirements where a Capital Needs Assessment is not required.

For more information on these policy changes, refer to the RAD Supplemental Notice 4C.

RAD Supplemental Notice Training Materials

In January, HUD published the RAD Supplemental Notice 4C (H-2025-01/PIH-2025-03, Rev 4-C), which primarily impacts public housing properties that have converted or will convert to the Section 8 platform through RAD. The Supplemental Notice implements statutory changes from the Consolidated Appropriations Act of 2024; establishes a waiver process for rental adjustments other than the Operating Cost Adjustments Factor (OCAF) under extraordinary circumstances; improves the resident experience; and strengthens preservation objectives and HUD oversight.

To support stakeholders, HUD recently published:

• The RAD Notice, as amended by 4C and 4B (integrating all edits in one comprehensive version of the notice)
• A redline version of the RAD Notice that shows the changes made by the RAD Supplemental Notice 4C
• Presentation and Recorded Training

The Consolidation of RAD Closing and Post-Closing Functions

Recap is now assigning a single staff member to handle both closing and post-closing task for each RAD project following the issuance of the RAD Conversion Commitment and continuing through the final submission of the completion certification. Some projects that have already closed may be reassigned to a new closing/post-closing staff person to streamline processing. In addition, Recap is gradually consolidating closing/post-closing staffing assignments for owners or PHAs with multiple RAD projects.  Please make sure to check the RAD Resource Desk to see if your assigned post-closing staff person has changed and continue to submit any post-closing requests as instructed on the RAD Resource Desk.

Why are we making this change?

Recap completed a comprehensive process evaluation of RAD closing and post-closing functions. Feedback and data that informed the evaluation was gathered from internal and external RAD participants, including property owners, PHAs, owners' legal counsel, developers, consultants, and colleagues within HUD. Stakeholders reported high levels of satisfaction with the closing process and routine post-closing requests and also identified areas of improvement. For example, one-third of external participants said that the transition from the closing to post-closing phases could be more seamless, which led to these changes.

What other process improvements are coming and who participated in the evaluation?

Stakeholders also noted that the time to resolve complex post-closing requests was inconsistent, that there should be improved coordination between HUD offices, and that additional technical support and guidance was needed for owners to transition between HUD systems and navigating initial year funding processes. Recap is rapidly working to address this valuable feedback. Watch for additional information on future improvements and new guidance in upcoming RADBlasts.

Thank you to everyone who participated in RAD's Closing and Post-Closing Evaluation.

Mark your Calendars for Recap's Office Hours on RAD!