9839c Project Owner's / Borrower's Certification

Project Owner's / Borrower's Certification
for Elderly Housing Projects
Managed by Administrators

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

OMB Approval No. 2502-0305
(exp. 11/30/2016)

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 info rmation. 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 Handb ook 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 Board of Directors of the Project Owner (Borrower
Corporation for 202 projects), I make the following certifications and agreements
to the United States Department of Housing and Urban Development (HUD)
regarding management of the above project.
1. I certify that:
a. The owner/borrower will comply with HUD requirements and contract
obligations, and will not receive payments in return for awarding the
administrator's responsibilities to him/her or to an agent thereof, and that such
payments will not be made in the future.
b. The administrator’s duties are specified in the following document(s).
(Check one or both boxes below.)
Position Description
Employment agreement
c. The above document(s) provide that the administrator will manage the
project for the term and compensation described below.
(1) Term of employment:
(2) Compensation (Describe salary, fringe benefits, bonuses, etc.):
d. The administrator will be paid from project income only after we have:
(1) Submitted this Certification to HUD;
(2) HUD has approved the administrator to manage this project; and
(3) HUD has approved the administrator's compensation, if required by
HUD's administrative procedures.
e. I understand that no compensation may be earned or paid after HUD has
terminated the administrator’s management of the project.
f. If HUD notifies me that the administrator’s compensation is excessive,
within 30 days I will 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 process,
making any required reductions and refunds within 30 days after the date of
this decision letter on the appeal.
g. I will ensure that the administrator reads and understands all applicable HUD
handbooks, notices and policy directives that impose requirements on project
management.
2. If the project is subsidized by HUD, I agree to and will require the administrator
to 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. I agree to:
a. Comply with this project’s Regulatory Agreement, Mortgage & Mortgage
Note, and any subsidy contract or Workout/Modification Agreement.
b. Comply with HUD handbooks, notices or other policy directives that relate
to the management of the project.
4. I agree to and will require the administrator to:
a. Ensure that all project expenses are reasonable and necessary.
b. Refrain from purchasing goods or services from entities that have identityof-interest with us unless the costs are as low as or lower than arms-length, openmarket purchases.
Previous editions are obsolete

Date (mm/dd/yyyy)

c. Exert reasonable effort to maximize project income and to take advantage
of discounts, rebates and similar money-saving techniques.
d. Obtain contracts, materials, supplies and services, including preparation of
the annual audit, on terms most advantageous to the project.
e. Credit the project with all discounts, rebates or commissions (including
sales/property tax relief granted by State/local government).
f. Obtain the necessary verbal or written cost estimates and document the
reasons for accepting other than the lowest bid.
g. Maintain copies of such documentation and make such documentation
available for your inspection during normal business hours.
h. 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 administrator not to invest those other funds.
5. I 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 a 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) the administrator 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.
b.
Hazard insurance coverage in an amount required by the projects
Mortgage.
c.
Public liability coverage with the owner, sponsor, and administrator
designated as the insured.
6. I will require the administrator 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. I will require the administrator to adhere to the following:
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:
(1) any records which relate to the project’s purchase of goods or services;
(2) the records of the owner and the administrator; and,
(3) the records of companies having an identity-of-interest with the owner
and the administrator.
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 administrator),
(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

Page 1 of 2

form HUD-9839-C (05/2003)
ref Handbooks 4381.5 & 4571.4

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. I certify that any employment agreement does not contain the type of “hold
harmless” clause prohibited by HUD.
9. I agree to include the following provisions in the employment agreement and to
be bound by them:
a. HUD has the right to terminate the employment agreement for failure to
comply with the provisions of this Certification, or other good cause, thirty days
after HUD has mailed me a written notice of its desire to terminate the
employment agreement.
b. In the event of a default under the Mortgage, Note or Regulatory Agreement,
HUD has the right to terminate the employment agreement immediately upon
HUD’s issuance of a notice of termination to the administrator and me.
c. If HUD exercises this right of termination, I agree to promptly make
arrangements for providing management that is satisfactory to HUD.
d. If there is a conflict between the Employment Agreement & HUD’s rights
and requirements, HUD's rights and requirements will prevail.
e. If agreement is terminated, I will require the administrator to give me all of
the project's cash, trust accounts investments and records within thirty (30 days
of the date the agreement is terminated.
10. I agree to:
a. To submit a new management certification to HUD before permitting a new
administrator or agent to operate the project and/or collect compensation or fees.
b. 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.
c. When the head or spouse is otherwise eligible, give families with children
equal consideration for admission.
d. Give handicapped persons priority for subsidized units that were built and
equipped specifically for the handicapped.
e. 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. I understand that these laws and
regulations prohibit discrimination against applicants or tenants who are handicapped or of a certain age.
f. 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).
g. Not discriminate against any employee, applicant for employment or contractor because of race, color, handicap, religion, sex or national origin.
h. Provide minorities, women and socially and economically disadvantaged firms
equal opportunity to participate in the project's procurement and contracting
activities.
i. If the project receives any form of direct Federal financial assistance,
comply with Section 3 of the Housing and Urban Development Act of 1968 and
its implementing regulations. I understand that this law and the regulations
require the project to make training, employment and contracting opportunities
available, to the greatest extent feasible, to lower-income project area residents
and small businesses.
11.I certify that I have read and understand HUD’s definition of “identity-ofinterest” 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 administrator and
any individuals or companies that regularly do business with the project.
b.
Only those individuals and companies listed in Section 11a of the
Management Entity Profile have an identity-of-interest with the administrator.
c.
Only the individuals and companies listed below have an identity-ofinterest 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.)
12.I certify that the administrator has had (check box a or b):
a.
no previous relationship(s) with this project
b.
previous relationship(s) as follows (Describe the relationship(s) and
period(s) covered, e.g., “member of Board of Directors, 1987-1990”.)

13.I certify that the administrator now manages (Check box a or b):
a.
no other project with an insured or HUD-held mortgage
b.
the additional project(s) described below (Give project name, location,
and FHA project number.)

14. I/We 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 project administrator.
15.The items checked below are attached:
New Management Entity Profile (Check this box only if you are
updating a profile or submitting a profile for the first time. Do not attach
a profile if the one you previously submitted is still current.)
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)

HUD Field Office Use Only
The administrator's compensation quoted in Paragraph 1b(2) is:
Approved

Not approved. See attached letter

By Project Manager :Name
title
signature
date (mm/dd/yyyy)

By Supervisory Project Manager/Hub Director: Name
title
signature
date (mm/dd/yyyy)

Previous editions are obsolete

Page 2 of 2

form HUD-9839-C (05/2003)
ref Handbooks 4381.5 & 4571.4