9839-B Project Owner's/Management Agent's Certification for Mul

Project Owner's/Management Agent's Certification
for Multifamily Housing Projects
for Identity-of-Interest
or Independent Management Agents

U.S. Department of Housing
and Urban Development
Office of Housing
Federal Housing Commissioner

OMB Approval No. 2502-0305
(exp. 04/30/2007)

Public reporting burden for this collection of information is estimated to average 15 minutes per response, including the time for reviewing instructions,
searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. This agency may
not conduct or sponsor, and a person is not required to respond to, a collection information unless that collecton displays a valid OMB control number.
Owners of insured and assisted multifamily housing projects are required by HUD administrative guidelines as found in HUD Handbook 4381.5 REV-2, The
Management Agent Handbook, to submit certain data for review by the local HUD office of approval of a new management agent. These requirements
apply to insured multifamily projects or HUD-held mortgages and subsidized, non-insured projects that are not financed by State Agencies or the Rural
Housing Service Agency.
Project name

FHA project number

City, State

Section 8 number

Acting on behalf of ____________________________________________,
the Project Owner (Owner), and ___________________________________,
the Management Agent (Agent), we make the following certifications and
agreements to the United States Department of Housing and Urban Development
(HUD) regarding management of the above project.
1. We certify that:
a. We will comply with HUD requirements and contract obligations, and
agree that no payments have been made to the owner in return for awarding
the management contract to the agent, and that such payments will not be
made in the future.
b. We have executed or will execute, within 30 days after receiving the
approval(s) required by paragraph b below, a Management Agreement for
this project The Agreement provides / will provide that the Management
Agent will manage the project for the term and fee described below. Changes
in the fee will be implemented only in accordance with HUD’s requirements
(1) Term of Agreement:_____________________________________
(2) Fees:
(a)___________% of residential income collected;
(b)___________% of commercial income collected;
(c)___________% of miscellaneous income collected
(This percentage must not exceed the percentage in (2)(a) above).
Yes
If yes, describe in paragraph 4
(d) Special Fees No
of Attachment 1.
(3) Calculation of Estimated Yield (See Attachment 1.)
c. We will disburse management fees from project income only after:
(1) We have submitted this Certification to HUD;
(2) HUD has approved the Agent to manage this project; and
(3) HUD has approved the management fee (if required).
d. We understand that no fees may be earned or paid after HUD has
terminated the Management Agreement.
e. If HUD notifies me of an excessive management fee, I, the Agent, will
within 30 days of HUD's notice either:
(1) Reduce the compensation to an amount HUD determines to be reasonable and
(2) Require the administrator to refund to the project all excessive fees
collected, or
(3) Appeal HUD's decision and abide by the results of the appeal p r o cess, making any required reductions and refunds within 30 days after the
date of this decision letter on the appeal.
f. If HUD holds the residential management fee yield harmless under the
transition provisions of Chapter 3, Section 4 of HUD Handbook 4381.5,
(1) We understand that HUD will adjust the management fee percentage
each time HUD approves a rent increase.
(2) We agree to be bound by that percentage until the next rent increase
or until HUD approves a different fee, pursuant to our request.
2. We will, if the project is subsidized by HUD, select and admit tenants,
compute tenant rents and assistance payments, recertify tenants and carry out
other subsidy contract administration responsibilities in accordance with HUD
Handbook 4350.3 and other HUD instructions.
3. We agree to:
a. Comply with this project’s Regulatory Agreement, Mortgage & Mortgage
Note, and any Subsidy Contract or Workout / Modification Agreement.

Previous editions are obsolete

Date (mm/dd/yyyy)

b. Comply with HUD handbooks, notices or other policy directives that
relate to the management of the project.
c. Comply with HUD requirements regarding payment and reasonableness
of management fees and allocation of management costs between the management fee and the project account.
d. Refrain from purchasing goods or services from entities that have identity-of-interest with us unless the costs are as low as or lower than armslength, open-market purchases.
4. The Agent agrees to:
a. Ensure that all expenses of the project are reasonable and necessary.
b. Exert reasonable effort to maximize project income and to take advantage
of discounts, rebates and similar money-saving techniques.
c. Obtain contracts, materials, supplies and services, including the preparation of the annual audit, on terms most advantageous to the project.
d. Credit the project with all discounts, rebates or commissions (including any
sales or property tax relief granted by the State or local government) received.
e. Obtain the necessary verbal or written cost estimates and document the
reasons for accepting other than the lowest bid.
f. Maintain copies of such documentation and make such documentation
available for your inspection during normal business hours.
g. Invest project funds that HUD policies require to be invested and take
reasonable effort to invest other project funds unless the owner specifically
directs the Agent not to invest those other funds.
5. We certify that the types of insurance policies checked below are in force and
will be maintained to the best of our ability at all times. Fidelity bonds and hazard
insurance policies will name HUD as an additional payee in the event of loss.
Note: For any box not checked, attach an explanation as to why you cannot obtain
that type of insurance. Such situations should be extremely rare.
Fidelity bond or employee dishonesty coverage for
a.
(1) all principals of the Agent and;
(2) all persons who participate directly or indirectly in the management
and maintenance of the project and its assets, accounts and records.
Coverage will be at least equal to the project’s gross potential income for
two (2) months.
Hazard insurance coverage in an amount required by the project's
b.
Mortgage.
c.
Public liability coverage with the Agent designated as one of the
insured.
6. The Agent agrees to:
a. Furnish a response to HUD’s management review reports, physical
inspection reports and written inquiries regarding the project’s annual
financial statements or monthly accounting reports within 30 days after
receipt of the report or inquiry.
b. Establish and maintain the project’s accounts, books and records in
accordance with:
(1) HUD’s administrative requirements;
(2) generally accepted accounting principles; and
(3) in a condition that will facilitate audit.
7. We agree that:
a. All records related to the operation of the project, regardless of where they
are housed, shall be considered the property of the project.
b. HUD, the General Accounting Office (GAO), and those agencies’ representatives may inspect :

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form HUD-9839-B (06/2003)
ref. Handbook 4381.5 & 4571.4

(1) any records which relate to the project’s purchase of goods or services,
(2) the records of the Owner and the Agent, and
(3) the records of companies having an identity-of-interest with the
owner and the agent.
c. The following clause will be included in any contract entered into with an
identity-of-interest individual or business for the provision of goods or
services to the project: “Upon request of HUD or (name of owner or Agent),
(name of contractor or supplier) will make available to HUD, at a reasonable
time and place, its records and records of identity-of-interest companies
which relate to goods and services charged to the project. Records and
information will be sufficient to permit HUD to determine the services
performed, the dates the services were performed, the location at which the
services were performed, the time consumed in providing the services, the
charges made for materials, and the per-unit and total charges levied for said
services.” The owner agrees to request such records within seven (7) days of
receipt of HUD’s request to do so.
8. We certify that any Management Agreement does not contain the type of
“hold harmless” clause prohibited by HUD.
9. We agree to include the following provisions in the Management Agreement
and to be bound by them:
a. HUD has the right to terminate the Management Agreement for failure
to comply with the provisions of this Certification, or other good cause, thirty
days after HUD has mailed the owner a written notice of its desire to
terminate the Management Agreement.
b. In the event of a default under the Mortgage, Note or Regulatory Agreement, HUD has the right to terminate the Management Agreement immediately upon HUD’s issuance of a notice of termination to the Owner and
Agent.
c. If HUD exercises this right of termination, I, the Owner, agree to promptly
make arrangements for providing management that is satisfactory to HUD.
d. If there is a conflict between the Management Agreement & HUD’s rights
and requirements, HUD's rights & requirements will prevail.
e. If the Management Agreement is terminated I, the Agent, will give to the
Owner all of the project's cash, trust accounts investments and records within
thirty (30) days of the date the Management Agreement is terminated.
10. I, the Owner, agree to submit a new Management Certification to HUD before
taking any of the following actions:
a. Authorizing the agent to collect a fee different from the percentages fees
and any special fees specified in Paragraph 1 of this Certification:
b. Changing the expiration date of the Management Agreement.
c. Renewing the Management Agreement.
d. Permitting a new Agent to operate the project.
e. Permitting a new Agent to collect a fee.
f. Undertaking self-management of the project.
11. We agree to:
a. Comply with all Federal, State, or local laws prohibiting discrimination
against any persons on grounds of race, color, creed, familial status, handicap, sex or national origin, including Title VI of the Civil Rights Act of 1964,
Fair Housing Act, , Executive Order 11063 and all regulations implementing
those laws.
b. When the head or spouse is otherwise eligible, give families with children
equal consideration for admission.
c. Give handicapped persons priority for subsidized units that were built
and equipped specifically for the handicapped.
d. If the project receives any form of direct Federal financial assistance,
comply with the provisions of Section 504 of the Rehabilitation Act of 1973,
as amended, the Age Discrimination Act of 1975 and all regulations and
administrative instructions implementing these laws. The Agent understands
that these laws and regulations prohibit discrimination against applicants or
tenants who are handicapped or of a certain age.
e. Furnish HUD’s Office of Fair Housing and Equal Opportunity any reports
and information required to monitor the project’s compliance with HUD’s
fair housing and affirmative marketing requirements (including HUD Form
949, if applicable).
f. Not discriminate against any employee, applicant for employment or
contractor because of race, color, handicap, religion, sex or national origin.
g. Provide minorities, women and socially and economically disadvantaged
firms equal opportunity to participate in the project's procurement and
contracting activities.
h. If the project receives any form of direct Federal financial assistance,
comply with Section 3 of the Housing and Urban Development Act of 1968

Previous editions are obsolete

and its implementing regulations. I, the Agent, understand that this law and
the regulations require the project to make training, employment and contracting opportunities available, to the greatest extent feasible, to lowerincome project area residents and small businesses.
12.We certify that we have read and understand HUD’s definition of “identityof-interest” and that the statement(s) checked and information entered below are
true. (Check box a or boxes b and / or c.)
a.
No identity-of-interest exists among the Owner, the Agent and any
individuals or companies that regularly do business with the project.
Only individuals and companies listed in Section 11a of the
b.
Management Entity Profile have an identity-of-interest with the Agent.
Only the individuals and companies listed below have an identity-ofc.
interest with the Owner. (Show the name of the individual or company; list
the services rendered; and describe the nature of the identity-of-interest
relationship. Attach additional sheets, if necessary.)

13.I/We, the Agent, certify & agree:
a. that the Management Entity Profile, dated (mm/dd/yyyy)_____________,
is accurate and current as of the date of this Certification.
b. To submit an updated profile whenever there is a significant change in the
organization or operations of the Management Entity.
14.The items checked below are attached:
Attachment 1–Calculation of Est. Yields from Proposed Mgt Fees
New Management Entity Profile
Updated Management Entity Profile
Other (Specify)_______________________________________
Warnings:
There are fines and imprisonment—$10,000/5years—for anyone who makes
false, fictitious, or fraudulent statements or entries in any matter within the
jurisdiction of the Federal Government (18 U.S.C 1001).
There are fines and imprisonment—$250,000/5years—for anyone who misuses
rents & proceeds in violation of HUD regulations relative to this project. This
applies when the mortgage note is in default or when the project is in a
nonsurplus cash position (12 U.S.C 1715z-9).
HUD may seek a “double damages” civil remedy for the use of assets or income
in violation of any Regulatory Agreement or any applicable HUD regulations (12
U.S.C 1715z-4a).
HUD may seek additional civil money penalties to be paid by the mortgagor
through personal funds for :
(1) Violation of an agreement with HUD to use nonproject funds for certain
specified purposes as a condition of receiving transfers of physical assets,
flexible subsidy loan, capital improvement loan, modification of mortgage terms
or workout. The penalties could be as much as the HUD Secretary's loss at
foreclosure sale or sale after foreclosure.
(2) Certain specific violations of the Regulatory Agreement, the penalties could
be as much as $25,000 per occurrence (12 U.S.C 1735f-15).

By Project Owner: Name
title

signature

date (mm/dd/yyyy)

By Management Agent: Name
title

signature

date (mm/dd/yyyy)

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form HUD-9839-B (06/2003)
ref. Handbook 4381.5 & 4571.4

Project Name

FHA Project Number

Date (mm/dd/yyyy)

HUD Field Office Use Only (Check all boxes that apply)

An up-front review of the management fee was:

Required

Not required

The management fees quoted in paragraph 1a and explained in Attachment 1 of this Certification are approved.
The management fees quoted in Paragraph 1a and explained in Attachment 1 of this Certification are not approved.
The attached letter, dated (mm/dd/yyyy) _____________, explains the reasons for this disapproval and sets forth the allowable management fees.
The residential management fee Percentage is held harmless at __________%.
The residential management fee Yield is capped at $__________PUPM. Each time you approve a rent increase, adjust the management fee
Percentage to maintain this yield and enter the information required below.
Effective Date (mm/dd/yyyy)
of New Fee %*

Monthly Rent Potential

Collections % Assumed**

Adjusted Management
Fee Percentage

* This should be the same date the rent increase is effective.
** 95% unless you approve a different percentage.

By Project Manager
Signature

By Supervisory Project Manager/Hub Director
Date (mm/dd/yyyy)

Signature

Name

Name

Title

Title

Previous editions are obsolete

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Date (mm/dd/yyyy)

form HUD-9839-B (06/2003)
ref. Handbook 4381.5 & 4571.4

Attachment 1—Calculation of Estimated Yields from Proposed Management Fees
Project Name:

FHA Project No.:

1.

Residential Fee

a.

Monthly residential rent potential (from Part A
of the most recent HUD-approved Rent Schedule $

b.

Line 1a times 0.95 *

c.

Percentage fee

d.

Monthly residential fee yield (Line 1b times 1c)

e.

Total number of residential units (include
rent-free units.)

f.
*

Residential fee yield per unit per month
(Line 1d divided by 1e.)

Date:

2.

Commercial Fee (Describe commercial space, how it is used and what
services management provides.)

$
%
$
units
$

PUPM

Note: Generally collections must be estimated at 95% of gross potential.
If you use a lower percentage, attach an explanation for the collections
HUD-approved Rent percentage used. Make sure that any assumption
of a lower collections base does not compensate the agent for services
for which a special fee will be paid.

a. Monthly commercial rent potential (from Part E
of the most recent HUD approved Rent
Schedule)
$
b. Percentage fee

%

c. Commercial fee yield (Line 2a times 2b)

$

3.
a.

Miscellaneous Fee
Percentage fee (not to exceed the residential income fee percentage in Line 1c)

b.

List any miscellaneous income on which HUD allows a fee to be taken, but on which you have agreed a fee will not be paid.

%

4. Special Fees
Show dollar amount(s), purpose(s) and time period(s) covered. Describe performance standards and target dates for accomplishment of special tasks. (Attach
additional sheets, if needed.)

Previous editions are obsolete

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form HUD-9839-B (06/2003)
ref. Handbook 4381.5 & 4571.4