Form 90173B-CA Part II of the Project Rental Assistance Contract

Part II of the Project
Rental Assistance Contract

Section 202 Supportive Housing for the Elderly
Section 811 Housing for Persons with Disabilities
See bottom of this form for Public Burden statement.
Type of Project

New Construction
Substantial Rehabilitation
Acquisition
2.1 Owner's Warranties, Amendments.

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

PRAC Contract No.

HUD Project No.

maintained, in an am ount det ermined b y HU D, out of the
amounts by which the Maximum Annual Contract Commitment
under section 1.1(c) exceeds the amount actually paid out under
the Contr act each fiscal year. Payments will be made from the
account for project ren tal as sistance pa yments when needed to
cover increases in Operating Ex pense Amounts or decreases in
tenant payments and for other costs specifically approved by the
Secretary.

(a) Legal Capacity. The Owner warrants that it has the legal right to
execute this Contract and to lease dwelling units covered by this
Contract.
(b) Completion of Work. The Owner warrants that the project as
described in section 1. 1 is in good and tenantable condition and
that the project has been completed in accordance with the terms
and conditions of the Capital Ad vance Agreement (Agreement)
or will be completed in accord ance with the Special Condit ions
for Accept ance (see atta ched exhibit, where applicable). Th e
Owner further warrants that it will remed y an y defects or
omissions covered b y this warr anty if called to its att ention
within 12 months of the effectiv e date of this Contract. The
Owner agrees that the continuation of this C ontract shall be
subject to the Owner meeting an y Special Conditions for
Acceptance.

(2) Whenever a HUD-approved estimate of th
e required
annual payments for a fiscal year exceeds the m aximum annual
commitment for that fiscal year pl us the current balance in the
project account, HUD will, within a reasonabl e period of tim e,
take s uch add itional s teps as m ay b e nec essary to as sure that
payments under the Contract will be adequate to cover increases
in Operating Expenses and decreases in tenant payments.
(3) An y amount remaining in th e account after payment of
the las t proje ct rental as sistance pa yment with respect to th e
project shall be applied by HUD in accordance with law.

2.2 Families To Be Housed.
(a) Families To B e Housed. If a Section 811 project, th e Contr act
Units are to be leased by the Owner to eligible Disabled Persons
(Families) for occupan cy b y s uch Families solel y as private
dwellings and as their princip al place of residen ce. If a Section
202 project, th e Contract Units are to be leased to eligib le
elderly Persons or Households (Families) solely.

2.4 Project Rental Assistance Payments To Owners.
(a) Project Rental Assistance Payments on Behalf of Families.
(1) Project assis tance pay ments shall b e paid to the Owner
for units (or residential space in a group home
under Section
811) under lease for occupanc y by Families in accordan ce with
the Contract . The project ren tal assistance payment will cover
the dif ference between the Operat ing Exp enses and t enant
payments as determ ined in accord ance with the HU Destablished schedules and criteria.

(1) HUD hereby agr ees to make project ren tal assistance
payments on behalf of Families for the Contract Units, to enabl e
the Families to lease Decent , Safe, and Sanitar y housing
pursuant to Section 202 or Section 811.
(2) If there is a Utili ty Allow ance and if th e Allowance
exceeds the tenant payment, the Owner shall pay the Family the
amount of the excess. HUD will pay funds to the Owner in trust
solely for the purpose of making this payment.

(2) The amount of project rental assistance payment payable
on behalf of a Family and the amount of tenant payment shall be
subject to ch ange b y re ason of changes in F amily Incom e,
Family com position, ext ent of excep tional m edical or other
unusual expenses or program rules in accordance with the HUDestablished s chedules and criteria; or b y r eason of a ch ange in
any applicable Utility Allowance approved or required by HUD.
Any s uch change s hall be effective as of th e d ate s tated in a
notification of t he ch ange to the F amily, which need not be at
the end of the Lease term.

2.3 Maximum Project Rental Assistance Commitment:
Project Account.

(a) Maximum Annual Contract Commitment. Notwithstanding any

other provisions of this Contra ct (other th an paragraph (b)(2) of
this section) or any provisions of an y oth er co ntract between
HUD and the O wner, HUD shall not be obligated to make and
shall not make an y project rental assistance payments under this
Contract in ex cess of the amount identified in section 1. 1 ( c).
However, th is amount may be reduced commensurately with
any red uction in the number
of Contract Units or in the
Operating Expense Amount or pursuant to any other provisions
of this Contract.

(b) Project Account.

OMB Approval No. 2502-0470
(Expires 8/31/2013)

(b) Vacan cies During Rent-up. If a Contra ct Unit (or residen tial
space in a group home under Section 811), is not leased as of the
effective date of the Contract, the Owner is entitled to assistance
payments in the am ount of 50 percent of the Ope rating Expense
for the unit (or pro rata share o f the Operating Expense for a
group home) for a vacanc y period not exceedin g 60 da ys from
the effective date of the Contrac t, provided th at the Owner: (1)
commenced m arketing and oth erwise com piled with section
2.2(d) of the Agreement;

(1) A project account will be est ablished and maintain ed by
HUD, as a specificall y identified and segregated account for the
project. The account will be established and
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form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5

(2) has taken and continues to take all feasible actions to fill th e
vacancy, including, but no t limited to, contacting applicants on
its waiting list , if an y, r equesting appropriate s ources to refer
eligible applicants, and advertising the availability of the unit in
a manner specifically designed to reach eligible families; and (3)
has not r ejected an y eligib le ap plicant except f or good cause
acceptable to HUD.

The financial obligation of HUD is limited to
making project
rental assistance payments on behalf of Fam ilies in accordan ce
with this Contract.
(f) Owner's Monthly Requests for Payments.
(1) The Owner shall submit monthly requests to HUD for
project rental assistance payments. Each request shall set forth ;
(i) the name of each Family and the address and/ or num ber of
the unit (or residential space in a group home) leased b y the
Family; (ii) the address and/or t he number of each unit, if an y,
not le ased to Families for w hich th e Owne r is cl aiming
payments; (iii) the Operating Ex pense Amount as set forth in
Exhibit I for each unit for w hich th e Owner is claiming
payments; (iv) the amount of tenant pay ment b y th e Family
leasing the unit (or, where applicable, the amount to be paid the
Family in accor dance with section 2.2(a)(2); an d (v) the total
amount of project r ental assistance p ayments requested b y the
Owner. (The total amount of pr oject rental assistance payments
requested equal total HUD-approved oper ating expenses for the
project minus th e tenant pay ments received from all units (see
(iv) above).)

(c) Vacancies Aft er Rent-up . If an e ligible f amily v acates an
assisted unit (or residential space in a g roup home) the Owner is
entitled to vacancy payments in the amount of 50 percent of the
Operating Expense (or pro rata share of the Op erating Expense
in a group home) for the first 60 days of vacancy if the Owner:
(1) Certifies that it did not cause the vacancy by violating the
lease, the Contract, or any applicable law;
(2) Notified HUD of the vacancy or prospective vacancy and
the reasons for the vacancy immediately upon learning of the
vacancy or prospective vacancy;
(3) Has fulfilled and continues to:
(i) m arket the vacant units or spaces in accordance wi th th e
HUD-approved Affirmative Fair Housing
Marketing Plan
(AFHMP) and all fair
hou sing and equ al opportun ity
requirements. The purpose of the plan and req uirements is to
achieve a condition in which eligib le families of similar income
levels in the same housing market have a like r ange of housing
choices avail able to them regar dless of their ra ce, co lor, cr eed,
religion, handicap, age, familial status, sex or national origin.

(2) Each of the Owner's m onthly r equests shal l conta in a
certification by it that to th e best of its knowledg e and be lief (i)
the dwell ing uni ts are in De cent, Safe, and Sani tary cond ition,
(ii) all the other facts and data on which the r equest for funds is
based ar e true and correct, (iii) the amount requ ested h as been
calculated in accordance with the provisions of th e Contract and
is pay able under the Contract, (i v) none of the am ount claimed
has been previously claimed or paid under this Contract, and (v)
the Owner has not rece ived an d will not recei ve pa yments or
other consider ation from the Family , HUD or an y oth er public
or private sourc e for the unit beyond that au thorized in th is
Contract and the lease.

(ii) Submits to HUD a list of leased and unl eased assisted units
(or in th e case o f a group home, l eased and unleased resid ential
spaces) with a j ustification for t he unle ased uni ts or res idential
spaces, in ord er to qua lify for vac ancy p ayments for the
unleased units or residential spaces.

(3) If the Owner has receiv ed an excessive payment, HUD,
in addit ion to any o ther righ ts to recover y, will deduc t the
amount from any subsequent payment or payments.

(iii) Has t aken and continu es to take all f easible act ions to fil l
the vacancy; and
(iv) Has not rejected an y eligible app licant except for good
cause acceptable to HUD.

(4) The Owner' s monthly requ ests for project r ental
assistance pa yments are s ubject to penalt y un der 18 U.S .C.
1001, which p rovides, among other things, that whoever
knowingly and willfully m akes or uses a docu ment or writing
containing any false, fictitious, or fraudulent statement or entry,
in an y m atter within th e jur isdiction of any department or
agency of the United Stated shall be
fined n ot more than
$10,000 or imprisoned for not more than five years, or both.

(4) For any vacancy resulting from an Owner's eviction of an
eligible family, certifies that it has complied with the provisions
at 24 CFR Part 247 which apply to all decisions b y an Owner to
terminate the tenancy or modify the lease of a family residing in
a unit (or residential space in a group home).
(d) Prohibition of Double Compen sation for Vacan cies. The owner
is not enti tled t o pa yments for vacan t units t o the ext ent i t
collects for th e vacancy from other sources (tenant pay ment,
security d eposits, reimburs ements from HUD for unpaid
operating exp ense amount, oth er amounts collected f rom the
Family, and government payments under other programs). If the
Owner collects any of the Family's share of th e tenant payment
for a v acancy p eriod in an amount which , when added to the
vacancy pa yment, res ults in m ore than th e Operat ing Expens e
Amount, the excess must be reimbursed as HUD directs.

(e) HUD Not Obligated for Ten

ant Pay ments. HUD has not
assumed any obligation for the amount of tenant pay ment or the
satisfaction of any claim by the Owner against any Family other
than in accordance with section 2.3(b) of this Contract.

2.5 Maintenance, Operation And Inspection.
(a) Maintenance and Operation. The Owner ag rees to maintain and
operate th e Co ntract Units and rel ated fac ilities to prov ide
decent, safe, and sanitary housing including the provision of all
the services, maintenance and utilities set forth in section 1.1(e).
If a Section 811 project, the Owner also agrees to comply with
the lead-based paint regulations at 24 CFR Part 3 5 and 24 CFR
Part 891. If HUD determines that the Owner is not meeting one
or more of thes e obligations, HUD shall have the right to take
action under section 2.24(a).
(b) Inspection. Prior to occupancy of any Contract Unit by a Family,
the Owner and the Family shall inspect the unit and

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form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5

both shall certify, on forms prescribed or approved by HUD, that
they have inspected the unit and have determined it to be decent,
safe, and sanitary in accordance with the criteria provided in the
forms. The Owner shall keep co pies of th ese reports on file for
at least three years.

(c) Replacement Reserve.
(1) The Owner s hall es tablish and m aintain a repl acement
reserve in an inter est-bearing account to
aid in funding
extraordinary maintenance and repair and replacement of capital
items in accordance with applicable regulations.

(c) Units Not Decent, Safe and Sanitary. If HUD notifies the Owner
that it has failed to maintain a dwelling unit in decent, safe, and
sanitary condition and the Owner fails to take co rrective action
within the time prescribed in the notice, HUD ma y exercise any
of it rights or remedies under th e Contract, including reduction
or suspension of project rental assistance p ayments, even if the
Family continued to occup y th e unit. If, howev er, the Family
wishes to be rehoused in another dwelling un it with assistan ce
and HUD does not have oth er f unds for such p urposes, HUD
may use the abated pro ject ren tal assistan ce p ayments for the
purpose of rehousing the Family in another dwelling unit. If the
Family continues to occup y the unit, it will do so in accordan ce
with th e t erms of its lease, inc luding th e t ermination dat e and
amount of tenant payments.

(i) The Owner s hall m ake m onthly depos its to t he repl acement
reserve commencing on the effective date of the Contract. For
staged projects, the deposits shall commence on a pro r ata basis
for units in each stage on the eff ective date of th e Contract for
that stage.
(ii) The reserv e m ust be bu ilt up to and m aintained at a l evel
determined by HUD to be su
fficient to m eet projected
requirements. Should the reserve reach that level, the amount of
monthly deposit to the rese rve may be reduced with HUD
approval.
(iii) Replacement reserve funds must be deposited with HUD or
a HUD-approved depository in an interest-bearing account. All
interest earnings must be added to the reserve.

(d) Notification of Abatement. A ny r eduction or suspension of
project rental assistance payments shall be effective as provided
in written no tification to the Owner. The Owner shall promptly
notify the Family of any such abatement.
(e) Overcrowded and Under-occu pied Units. Where the Owner
determines a un it is larger o r smaller th an app ropriate for an
eligible family, the Owner agrees, if possible, to offer the family
an appropr iate alternate un it as promptly as possible in
accordance with HUD regul ations and requireme nts in effect at
the time of the determination.
2.6 Financial Requirements.
(a) Submission of Financial and Operating Statements.
The Owner must submit to HUD:
(1) Within 60 days after the end of each fiscal year of project
operations, f inancial statements for th e pro ject audited by an
Independent Public Accountan t in the form req uired b y HUD,
and
(2) Other statements as to
p roject operation , fin ancial
condition and occupancy as HUD may require to administer this
Contract and to monitor project operations.
(b) Use of Project Funds.

(1) The Owner shall maintain a pro ject fund account in a
HUD-approved depository and shall deposit all tenant payments,
charges, income and r evenues arising from project operation or
ownership in this account. Project funds must b e used for the
operation of the project (including required insurance coverage),
to pay operating expenses, and to make required deposits to the
replacement r eserve in accordance with paragr aph (c) of this
section. To the exten t HUD de termines that project funds are
more than need ed for these pur poses, the surplus project funds
must be deposited with a HU D-approved depositor y in an
interest-bearing residual receipts account. Withdrawals from this
account will be made only with the approval of HUD and for
project purposes, includ ing th e reduction of project rental
assistance pay ments. Upon term ination of the Contract, an y
excess funds must be remitted to HUD.

(iv) Funds may be withdrawn from the reserve and used only in
accordance with HUD guidelines and with the approval of, or as
directed by, HUD.
(d) The Owner is not entitled to distributions of project funds.
2.7 Operating Expense Adjustments.
(a) Funding of Adjustments. Project rental assistance payments will
be in creased commensurate with ad justments in op erating
expenses under this section up to the m
aximum a mount
authorized under section 2.3(a) of this Contract. HUD will
calculate operating expense adjustments based on the sum of the
costs for oper ating the project (as approv ed by HUD) with
adjustments for vacancies, the p roject's non-rent al in come, an d
other factors that HUD deems ap propriate. The calculation will
be made on the basis of the inform ation provided by the Owner
on a form prescribed by HUD.
(b) Operating Exp ense Adjustments. Operating Expenses shall be
adjusted whenever HUD approves an incr ease in operating costs
as provided under the Regulatory Agreement.
(c) Incorporation of Operating Expense A
djustment. An y
adjustment in Operating Expenses shall be i ncorporated int o
Exhibit I by a dated addendum to the exhibit establishing the
effective date of the adjustment.
(d) Adjustment of Operating Expens e Based on C ost Certification .
The Owner s hall com plete th e cos t certifi cation requirem ents
under 24 CFR part 891.
(e) Adjustment of Operating
Expense Am ounts Due to Tax
Exemption. The Operating Expense Amounts may be reduced to
reflect real prop erty tax exemption or similar sa vings where the
initial operating expenses were approved on the assumption that
the project would not receive the benefit of the tax abatement or
similar savings. The Owner agrees to notify HUD in the event
the proje ct beg ins to receiv e such an exem ption or sim ilar
savings so the Initial Operating Expense Amounts then in effect
may be reduced.

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form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5

(iii) A Famil y's eligibility for pr oject rental assistance pay ments
continues until its total Fam ily contribution equals the tot al
housing expense for the un it it o ccupies (or a pr o rata sh are of
the operating expense in a gro up hom e). Th e term ination of
subsidy eligibility at this point will not affect the Family's other
rights under th e lease nor pr eclude resumption of subsid y
payments as a result of later
changes in incom e or other
circumstances during the term of this Contract.

2.8 Marketing And Leasing Of Units.
(a) Compliance with Equal Opport unity Requir ements. Marketing
of units and selection of Families b y the Owner shal l b e in
accordance with the Owner' s HUD-approved Affirmative Fair
Housing Marketing Plan (if requ ired), shown as an exhibit, and
with all regulations relating to f air housing advertising. Projects
shall be manag ed and op erated w ithout r egard to race, co lor,
religion, creed, age, sex, hand icap, fam ilial st atus or national
origin, except housing provided under Sectio n 202 must be
limited to households where at least one p erson is 62 years of
age or older.
(b) Security Deposits. The Owner agrees to comply with applicable
HUD regulations (24 CFR Part 891) and oth er requirements, as
revised from time to time, reg arding secur ity deposits and to
comply with all State and local law.
(c) Eligibility, Selection and Admission of Families.
(1) The Owner shall be respo nsible for deter mination of
eligibility of applicants, selection of families fro m among those
determined to b e eligible, computation of th e amount of project
assistance pa yments on behalf of each s elected F amily and of
total Family contributions and record-k eeping in accordance
with applicable HUD regulations and requirements.
(2) The Owner shall not charge an y applicant or assisted
Family an y amount in excess of the total Family con tribution
except as authorized by HUD.
(3) The Owner must accept applications for admission to the
project in th e f orm prescribed b y HUD. Applicant families
applying for as sisted units (or residential spaces in a group
home) must complete a certification of eligibility as part of the
application for admission. Both the Owner an d the app licant
family must sig n the app lication for admission. On request, th e
Owner must for ward to HUD copies of these app lications for
admission.
(4) The Leas e enter ed into bet ween the Owner and each
selected Family shall be on the form of Lease approved by HUD
and must contain all of th e required provisions and none of the
prohibited provisions specified in HUD issuances. The term of
the lease may not be less than one year.

(6) The Owner will maintain as confidential all information
relating to appli cants and assisted Fam ilies, the disclosure of
which would constitute an un warranted inv asion of p ersonal
privacy.
(d) Redetermination of Operating Expense af ter Adjustment in
Utility Allowances. In the even t that the Owner is notified of a
HUD determination approving or re quiring an adjustment in the
Utility Al lowance app licable to an y of th e Con tract Units, the
Owner shall promptly make a corresponding ad justment in the
amount of tenan t pa yment to be paid b y th e aff ected Fam ilies
and the amount of project rental assistance payments.
(e) Processing of Applications and Complaints. Th e Owner s hall
process applic ations for adm ission, notifi cations to applican ts,
and com plaints b y appl icants in ac cordance with appl icable
HUD regulations and requirements and shall maintain records
and furnish such copies or other information as may be required
by HUD.
(f) Reviews; Incorrect Payments. In making project rental assistance
payments to
Owners, HUD will
review the Owner's
determinations under this section. If, as a result of this review or
other reviews, audits or informa tion received b y HUD at an y
time, i t is de termined that the Owner has rece ived im proper or
excessive assistance payments, HUD shall have the right
to
deduct th e am ount of s uch overpa yments fro m an y am ounts
otherwise due the Owner, or otherwise effect recovery.
2.9 Termination of Tenancy or Project Rental Assistance by the
Owner.
The Owner agr ees not to terminate any tenancy of or as sistance
on behalf of an as sisted F amily excep t in ac cordance wi th a ll
HUD regulations and other requiremen ts in effect at the time of
the term ination, and an y S tate and loc al l aw. Terminations of
tenancy are subject to 24 CFR Part 247.

(5)
(i) Th e Owner shall m ake a r eexamination of Family income,
composition, and the ex tent of medical or other unusual
expenses in curred b y the F amily at le ast every 12 m onths and
appropriate redeterminations shall be made b y the Owner of the
amount of Family contribution and the amount of project r ental
assistance p ayments, all in accordance with applicable HUD
regulations and requirements.
(ii) If a Fam ily r eports a change in income or other
circumstances that would r esult in a de crease of tota l Fam ily
contribution between regu larly scheduled reex aminations, the
Owner, upon r eceipt of verif ication of the change, must
promptly mak e appropriate ad justments in the to tal Family
contribution. The Owner may require in i ts leas e that F amilies
report increases in income or ot her changes between scheduled
reexaminations.

2.10 Nondiscrimination.
The Owner shall comply with:
(a) The requ irements of the Fair Ho using Act (42 U .S.C. 3601-19)
and its implementing regulations at 24 CFR Part 100; Executive
Order No 11063 (Equal O
pportunity in
Housing) and
implementing r egulations at 24 CFR Part 107; and Title VI of
the Civil Rights Act of 1964 (42 U.S.C.
2000d)(Nondiscrimination in Federally Assisted Programs.) and
implementing regulations at 24 CFR Part 1;
(b) The prohibitions against discrimination on the basis of age under
the Age Discrimination Act of 1975 (42 U.S.C. 6101-07) and
implementing regulations at 24 CFR Part 146, and the
prohibitions against discrimination against otherwise

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ref Handbooks 4571.4 and 4571.5

(c)
(d)

(e)
(f)

(g)
(h)

qualified ind ividuals with h andicaps under section 504 of th e
Rehabilitation A ct of 1973 (29 U.S.C. 794) and implementing
regulations at 24 CFR Part 8.
The requir ements of Executive Order No. 11246 (Equal
Employment Opportunity) and the regulations is sued under the
Order at 41 CFR Chapter 60;
The r equirements of section 3 of th e Housing and Urb an
Development Act of 1968 (12 U.S.C. 1701u) (Emplo
yment
Opportunities f or Lower Inco me Persons in Connection wit h
Assisted Proje cts) a nd the implementing regulations at 24 CFR
Part 135;
The requ irements of Executiv e Order Nos. 11625, 12432, and
12138 (Minority and Women's Business Enterprises);
The affirmative fair housing mar keting requirements of 24 CFR
Part 200, Subpart M and th e im plementing regulations at 24
CFR Part 108;
The fair housing advertising and poster guidelines, 24 CFR Parts
109 and I 10; and
The civil rights and Equal Opportunity reporting requirements at
24 CFR Part 885.940(f).

(b) Promptly to no tify HUD of the receipt of any communication
from the EPA indicating that a facil ity to be u tilized for th is
Contract is und er consideration to be listed on the EPA List of
Violating Facilities;
(c) To comply with all the requ irements of section 1 14 of the Air
Act and sect ion 308 of the Water Act re lating to inspect ion,
monitoring, entry, reports, and information, as well as all other
requirements s pecified in s ection 114 of the Air Act and
section 308 of the Water Act, and all regulations and guidelines
issued thereunder; and
(d) To include or cause to be in cluded th e provisions of this
Contract in eve ry nonexempt subcontract and take such act ion
as HUD may direct as a means of enforcing such provisions.
2.15 Displacement and Relocation Assistance.
The Owner agr ees to com ply with the Unifor m Relocation
Assistance and Real Property Acquisition Policies Act of 1970
(42 U.S.C. 460 1) as amended b y th e Unifor m Relocation
Assistance Am endments of 1987, Tit le IV of the S urface
Transportation and Uniform Relocation Assistance Act of 1987
(Pub. L. 100- 17, approv ed April 2,1987) (URA) and
government-wide implementing regulations at 49 CFR Part 24
which set forth relocation assistance requirements that apply to
the displacement of any person (family , indiv idual, business,
nonprofit organization or farm) as a direct result of acquisition,
rehabilitation or dem olition for a proje ct assisted under th is
part.

2.11 Cooperation in Equal Opportunity Reviews.
The Owner ag rees to cooper ate with HUD in conducting
monitoring and compliance reviews and complaint
investigations p ursuant to or p ermitted b y all applicable c ivil
rights statutes and regulations, Executive Orders, and civil rights
related program requirements.
2.12 National Environmental Policy Act.

2.16 Lead-Based Paint.

The Owner agrees to comply with a ll applicable requ irements
under the Natio nal Environmental Policy Act ( NEPA) of 1969
(42 U.S.C. 4321 et seq .) and H UD regulation 2 4 CFR Part 50
including the related env ironmental laws, Ex ecutive Orders and
HUD standards in 24 CFR 50.4

The Owner agre es to com ply with requirem ents of the LeadBased Paint Poisoning Prevention Act (42 U.S.C. 48214846)
and implementing regulation at 24 CFR Part 3 5 to th e ex tent
they are applicable to housing under the Contract.
2.17 Lobbying.

2.13 Flood Disaster Protection Act.
If the Project is located in an area that has been identified by the
Director of the Federal Emergency Man agement Agency as an
area hav ing special flood hazards and if the sale of flood
insurance h as been made av ailable und er the National Flood
Insurance Act of 1968, the O wner agrees that it will obtain
coverage of the Project, durin g its anticipate d economic or
useful life, b y flood insurance in an amount at least equal to its
development or project cost ( less estimated land cost) or to the
maximum limit of cover age made av ailable wi th res pect to th e
particular ty pe of property unde r the National Flood Insurance
Act of 1968, whichever is less.
2.14 Clean Air Act and Federal Water Pollution Control Act.
In compliance with 'regulation s issued b y th e Environmental
Protection Agen cy (EPA), 40 CFR, Part 15 , pursuant to th e
Clean Air Act, as amended ("Air Act"), 42 U.S.C. 7401, et seq.,
the Feder al Water Pollution Co ntrol Act, as amended ("Water
Act"), 33 U.S.C. 1251, et seq. , and Execu tive Order 1173, the
Owner agrees:

The Owner agr ees to com ply with the prohib itions aga inst
lobbying the E xecutive or Leg islative Branches of the F ederal
Government contained in Pub. L. 101-121 (31 USC 1352) and
implementing regulations at 24 CFR Part 87.
2.18 Reports and Access to Premises and Records.
(a) The Owner shall furnish an y information and reports pertin ent
to this Con tract as re asonably may b e requ ired from tim e to
time by HUD.
(b) The Owner shall permit H
UD or its du
ly authorized
representatives to have access to the premises and, for the
purpose of audit and examination, to have access to any books,
documents, papers and records of the Owner th at are p ertinent
to compliance with th is Contract, including the verification of
information pertinent to project rental assistance payments.
2.19 Disputes.

(a) Not to u tilize any facility in the performance of this Contract or
any nonexempt subcontractor which is listed on the EPA List of
Violating Facilities pursuant to Part 15 of the regulations for the
duration of time that the facility remains on the list.
Page 5 of 7

Any dis pute concerning a ques tion of fa ct ar ising under th is
Contract which cannot be res olved b y agr eement between th e
HUD Field Office and th e Ow ner may be sub mitted b y the
Owner to th e HUD Secretary or a des ignee. Both parties shall
proceed diligently with the performance of this Contract and in
accordance with the Field Office's decision, pending resolution
of the appeal.
form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5

2.20 Conflicts of Interest.
Officers, dir ectors, stockholders and authorized representativ es
of the Owner may not have any financial interest in any contract
in connection w ith the r endition of services, th e provision of
goods or supplies, project
management, p rocurement of
furnishings or equipment,
construction of the project,
procurement of the site, or other matters related to development
and operation of the project.
2.21 Interest of Member of or Delegate to Congress.
No member of o r delegate to th e Congress of the United States
of Am erica or resident com missioner shall be a dmitted to an y
share or part of this Contract or to an y benefits which may arise
from it.
2.22 Assignment, Sale or Foreclosure.
(a) The Owner agrees that it ha s no t made and will not make an y
sale, assignment, or conveyance or tr ansfer in an y f ashion, of
this Contract, th e Agreement, or the project or an y part of them
or any of its Int erest in them, without the prior written consent
of HUD.
(b) The Owner agrees to notif y H UD pro mptly of an y proposed
action covered by paragr aph (a ) of this section and further
agrees to request HUD's prior written consent.
(c) Except where o therwise approv ed b y HUD, this Contract and
the Agreement shall continu e in effect and
project r ental
assistance payments will cont inue in accordan ce with the t erms
of this Contract in the event:
(1) of assignment, sal e or oth er disposition of t he project ,
this Contract or the Agreement,
(2) of foreclosure, including foreclosure by HUD.
(3) of assignments of the mortgage or deed
foreclosure,

(2) HUD Determination of Default. Upon a determination by
HUD that a d efault h as occurred, HUD shall n otify th e Owner
of(i) The nature of the default,
(ii) The actions requir ed to be tak en and th e remedies to be
applied on account of the def ault (including actions b y th e
Owner to cure the default), and
(iii) Th e tim e within which th e Owner shall respond with a
showing that all the required actions have been taken.
If the Owner fails to respond or take ac tion to the satisfaction of
HUD, HUD shall have the right to take correc tive action to
achieve compliance in accord ance with par agraph (3) of this
section or to te rminate th is Contrac t, in whole or in part , or to
take oth er corr ective ac tion t o achiev e com pliance in its
discretion.
(3) Corrective Actions. Pursuant to par agraph (a)(2) of th is
section HUD, in its discretion may take the following corrective
actions:
(i) Take possession of the project, bring any action necessar y to
enforce any rig hts of the Owner growing out of the project
operation, and operate the project in accordance with the terms
of this Contract until such time as HUD determines that th e
Owner is again in a position to operate the project in accordance
with this Contract. If HUD ta kes possession, project rental
assistance p ayments s hall co ntinue in accordance wi th this
Contract.
(ii) Collect all tenant payments and charges in c onnection with
the operation o f the project an d use these funds to pay
the
necessary expenses of preserving the property and operating the
project and to p ay the Owner 's ob ligations under the note and
mortgage or other capital advance documents.
(iii) Appl y to an y court, Stat e or Fed eral, for speci fic
performance of this Contract, for an injun
ction against any
violation of the Contract, for th e appo intment o f a r eceiver to
take over and operate th e proj ect in accor dance with th e
Contract, or for such other relief as may be appr opriate. Th ese
remedies are appropriate since the injury to HUD arising from a
default under an y of th e term s of this Contract
could be
irreparable and the amount of damage would be difficult to
ascertain.

in lieu of

(4) HUD takes over possession, operation or ownership,
(5) of transfer to another nonprofit owner.
2.23 Defaults by Owner.
(a) Rights of HUD If Owner Defaults under Contract.

(iv) Reduce or suspend project rental assistance payments.

(1) Even ts of D efault. A def ault b y the Owner under this
Contract shall result if(i) The Owner has viol ated or fail ed to co mply with any
provision of, or obligation under , this Contract o r of an y Lease,
including failure to correct any deficiencies identified by HUD
in connection with any annual or other inspection; or
(ii) The Owner has asserted or demonstrated an intention not to
perform some o r all of its obligations under this Contract or
under any Lease; or
(iii)The Owner has violated
or failed to co mply with the
regulations for the Section 202 or Section 811 program, with the
HUD mortgage, or with the regula tory agreement; or the Owner
has filed any false statement or misrepresentation with HUD in
connection with the capital advance.
Page 6 of 7

(v) Transfer to another nonprofit owner.
(vi) Recover any overpayments.
(b) Remedies Not Exclusiv e and Non-Waiver of Remedies.
The ava ilability of an y rem edy under this Contrac t, s hall not
preclude the exercise of any other remedy under this Contract or
under an y prov isions of law, no r shall any a ction taken in th e
exercise of an y rem edy be considered a waiv er of an y oth er
rights or remedies. Failure to ex ercise any right or remed y shall
not constitute a waiver of th e right to exe rcise that or an y other
right or remedy at any time.

form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5

Amendment to the Project Rental Assistance Contract:
Amendment No.

PRAC Contract No.

HUD Project No.

This Contract, entered into by and between the United States Of America acting through the Department of Housing and Urban
Development ("Government") and ("Owner")
Witness:
In consideration of the mutual benefit to each of the aforesaid parties, the Project Rental Assistance Payments Contract executed by
the Owner on
, and by the Government on
shall be and the same is hereby amended as follows:

Except as herein amended, the said Contract remains in full force and effect.
In Witness Whereof, the parties hereto have executed this Contract in five original counterparts.
United States of America
Secretary of Housing and Urban Development

Owner

By

By
Name

Name

Official Title

Official Title

Date

Date

Public reporting burden for this collection of information is estimated to average 30 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. HUD may not collect this information,
and you are not required to complete this form, unless it displays a currently valid OMB control number.
This information collection is necessary to ensure that viable projects are developed. It is important to obtain information from applicants to assist HUD in determining
if nonprofit organizations initially funded continue to have the financial and administrative capacity needed to develop a project and that the project design meets the
needs of the residents. The Department will use this information to determine if the project meets statutory requirements with respect to the development and operation
of the project, as well as ensuring the continued marketability of the projects. This information is required in order to obtain benefits. This information is considered
non-sensitive and no assurance of confidentiality is provided.

Page 7 of 7

form HUD-90173-B-CA (12/20/2005)
ref Handbooks 4571.4 and 4571.5