USDA Rule Makes CARES Act Notice Permanent
Beneficiaries of federal rural housing programs must comply.
By Nicole Upano, National Apartment Association |
The Rural Housing Service (RHS) of the U.S. Department of Agriculture (USDA) has issued its final rule to amend regulations for the federal Multi-Family Housing (MFH) Direct Loans and Grants Programs, requiring Section 515, 514 and 516 Multi-Family Housing program borrowers to provide their residents with at least 30 days’ notice prior to a lease termination or eviction action for nonpayment of rent.
The final rule stipulates that covered multifamily borrowers must provide:
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Notice of how to cure the nonpayment of rent violation;
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Information on how the resident can recertify their income; and
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Information as provided by the Secretary of Agriculture during a presidential declaration of a public health emergency regarding federal funding for tenants to prevent eviction.
Compliance with these provisions of the rule is required as of April 24, 2024 -- the rule’s effective date. Additionally, housing providers should keep the rule’s forthcoming compliance date for lease changes in mind. RHS will find MFH borrowers noncompliant if they fail to include the 30-day notice requirements in lease agreements no later than September 25, 2025.
According to the rule, RHS claims that “[t]his statutory requirement has been in place since the enactment of the CARES Act in March 2020, and is not limited to periods of national emergency.” The National Apartment Association (NAA) respectfully disagrees; the CARES Act extension of notice expired after the temporary CARES Act moratorium expired.
NAA urges Congress to pass the Respect State Housing Laws Act (H.R. 1078/S. 470). This legislation strikes the temporary, federal notice language from the CARES Act and returns eviction policies back to the states, eliminating any ambiguity about the requirement’s expiration. Read more.
Much like our concern about the HUD 30-day notice rule for Project Based Rental Assistance (PBRA) properties, NAA urges USDA and RHS to rescind its rule for covered rural housing providers. Continued enforcement of the CARES Act notice increases financial risks to housing providers and residents alike and does not serve public interest.
To learn more about NAA’s federal regulatory advocacy, contact publicpolicy@naahq.org.