HUD-9639 Housing Assistance Payments Preservation Renewal Contrac

Section 8 Contract Renewal Policy – Guidance for the Renewal of Project-Based Section 8 Contracts

9639

Section 8 Contract Renewal Policy – Guidance for the Renewal of Project-Based Section 8 Contracts

OMB: 2502-0587

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Attachment 13

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

Project-based Section 8
HOUSING ASSISTANCE PAYMENTS

PRESERVATION RENEWAL CONTRACT

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PREPARATION OF CONTRACT
Reference numbers in this form refer to notes at the end of the contract text.
These endnotes are instructions for preparation of the Preservation Renewal
Contract. The instructions are not part of the Renewal Contract.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
1

Attachment 13

TABLE OF SECTIONS
 1

1 CONTRACT INFORMATION

   PROJECT                                                                                        1
2 TERM AND FUNDING OF RENEWAL CONTRACT

3

3 DEFINITIONS

4

4 RENEWAL CONTRACT                                                                  5
  a Parties                                                                                           5 
  b Statutory authority                                                                       5
  c Expiring Contract                                                                         5
  d Purpose of Renewal Contract                                                     5
  e Contract units                                                                               6
5 EXPIRING CONTRACT – PROVISIONS RENEWED

6

6 CONTRACT RENT

7

   a Initial contract rent

7

   b Contract rent adjustments in accordance with the Plan of     7
Action
   d No other adjustment

7

7 OWNER WARRANTIES

8

8 OWNER TERMINATION NOTICE

8

9 HUD REQUIREMENTS

8

10 STATUTORY CHANGES DURING TERM

8

11 PHA DEFAULT

9

Form HUD-9639
Preservation Renewal Contract
REV 10/09
1

Attachment 13

12 EXCLUSION OF THIRD-PARTY RIGHTS

9

13 WRITTEN NOTICES                                                                    10
SIGNATURES                                                                             11

Form HUD-9639
Preservation Renewal Contract
REV 10/09
2

Attachment 13

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

Project-based Section 8

HOUSING ASSISTANCE PAYMENTS
PRESERVATION RENEWAL CONTRACT1

1

CONTRACT INFORMATION2

PROJECT
Section 8 Project Number:
Section 8 Project Number of Expiring Contract:
FHA Project Number (if applicable):
Project Name:
Project Description:3

Form HUD-9639
Preservation Renewal Contract
REV 10/09
1

Attachment 13

Plan of Action
During the term of the Renewal Contract, the Owner shall operate the project in
accordance with the Plan of Action, as submitted to HUD on
,
(the
“POA Submission”) and as approved and/or amended by HUD on
(“HUD’s
POA Approval Letter”) (the POA Submission as amended by HUD’s POA
Approval Letter is hereinafter referred to as the “Plan of Action”).
Use Agreement or Regulatory Agreement
During the term of the Renewal Contract, the Owner shall operate the Project in
accordance with the Use Agreement or/and Regulatory Agreement. The Use
Agreement and/or the Regulatory Agreement (as amended, if applicable) in
effect at execution of this contract is/are described as follows: 4

Attached hereto as Exhibit B is HUD’s POA Approval Letter and, if applicable,
copies of any provisions from the following documents necessary to understand
the rental adjustment provisions: the POA Submission, Use Agreement or
Regulatory Amendment.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
2

Attachment 13

PARTIES TO RENEWAL CONTRACT
Name of Contract Administrator5

Address of Contract Administrator

Name of Owner6

Address of Owner

2

TERM AND FUNDING OF RENEWAL CONTRACT
7

a

The Renewal Contract begins on
8
of
year(s).

and shall run for a period

b

Execution of the Renewal Contract by the Contract Administrator is
an obligation by HUD of $
,9 an amount sufficient to provide
10
housing assistance payments for approximately
months of
the first annual increment of the Renewal Contract term.

c

HUD will provide additional funding for the remainder of the first
annual increment and for subsequent annual increments, including
for any remainder of such subsequent annual increments, subject
to the availability of sufficient appropriations. When such
appropriations are available, HUD will obligate additional funding
and provide the Owner written notification of (i) the amount of such
additional funding, and (ii) the approximate period of time within the
Renewal Contract term to which it will be applied.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
3

Attachment 13

3

DEFINITIONS
ACC. Annual contributions contract.
Anniversary. The annual recurrence of the date of the first day of the
term of the Renewal Contract.
Contract units. The units in the Project that are identified in Exhibit A by
size and applicable contract rents.
Contract rent. The total monthly rent to owner for a contract unit,
including the tenant rent (the portion of rent to owner paid by the assisted
family).
HAP contract. A housing assistance payments contract between the
Contract Administrator and the Owner.
HUD. The United States Department of Housing and Urban Development.
HUD requirements. HUD regulations and other requirements, including
changes in HUD regulations and other requirements during the term of the
Renewal Contract.
MAHRA. The Multifamily Assisted Housing Reform and Affordability Act of
1997 (Title V of Public Law No.105-65, October 27, 1997, 111 Stat. 1384),
as amended.
PHA. Public housing agency (as defined and qualified in accordance with
the United States Housing Act of 1937. 42 U.S.C. 1437 et seq.).
Preservation Project. A project that is subject to a HUD-approved Plan
of Action under the Emergency Low -Income Housing Preservation Act of
1987 (12 U.S.C. § 1715l note) or the Low-Income Housing Preservation
and Resident Homeownership Act of 1990 (12 U.S.C. § 4113).
Project. The housing described in section 1 of the Renewal Contract. The
housing is a Preservation Project.
Section 8. Section 8 of the United States Housing Act of 1937 (42 U.S.C.
§ 1437f).
Renewal Contract. This contract, including applicable provisions of the
Expiring Contract (as determined in accordance with section 5 of the
Renewal Contract).

Form HUD-9639
Preservation Renewal Contract
REV 10/09
4

Attachment 13

4

RENEWAL CONTRACT
a

b

Parties
(1)

The Renewal Contract is a housing assistance payments
contract (“HAP Contract”) between the Contract
Administrator and the Owner of the Project (see section 1).

(2)

If HUD is the Contract Administrator, HUD may assign the
Renewal Contract to a public housing agency (“PHA”) for the
purpose of PHA administration of the Renewal Contract, as
Contract Administrator, in accordance with the Renewal
Contract (during the term of the annual contributions contract
(“ACC”) between HUD and the PHA). Notwithstanding such
assignment, HUD shall remain a party to the provisions of
the Renewal Contract that specify HUD’s role pursuant to
the Renewal Contract, including such provisions of section 9
(applicable requirements), section 10 (statutory changes
during term), and section 11 (PHA default), of the Renewal
Contract.

Statutory authority
The Renewal Contract is entered pursuant to section 8 of the
United States Housing Act of 1937 (42 U.S.C. § 1437f), and section
524(e)(1) of the MAHRA.

c

Expiring Contract
Previously, the Contract Administrator and the Owner had entered
into a HAP Contract ("expiring contract") to make Section 8 housing
assistance payments to the Owner for eligible families living in the
Project. The term of the expiring contract will expire prior to the
beginning of the term of the Renewal Contract.

d

Purpose of Renewal Contract
(1)

The purpose of the Renewal Contract is to renew the
expiring contract for an additional term. During the term of
the Renewal Contract, the Contract Administrator shall make
housing assistance payments to the Owner in accordance
with the provisions of the Renewal Contract. Such payments
provide to the owner rent benefits comparable to those
provided under the Plan of Action in accordance with section
524(e)(1) of the MAHRA.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
5

Attachment 13

(2)

e

Housing assistance payments shall only be paid to the
Owner for contract units occupied by eligible families leasing
decent, safe and sanitary units from the Owner in
accordance with statutory requirements, and with all HUD
regulations and other requirements. If the Contract
Administrator determines that the Owner has failed to
maintain one or more contract units in decent, safe and
sanitary condition, and has abated housing assistance
payments to the owner for such units, the Contract
Administrator may use amounts otherwise payable to the
Owner pursuant to the Renewal Contract for the purpose of
relocating or rehousing assisted residents in other housing.

Contract units
The Renewal Contract applies to the Contract units.

5

EXPIRING CONTRACT – PROVISIONS RENEWED
a

Except as specifically modified by the Renewal Contract, all
provisions of the Expiring Contract are renewed (to the extent such
provisions are consistent with statutory requirements in effect at the
beginning of the Renewal Contract term).

b

Any and all provisions of the Expiring Contract concerning any of
the following subjects are not renewed, and shall not be applicable
during the renewal term:

c

(1)

Identification of contract units by size and applicable contract
rents;

(2)

The amount of the monthly contract rents;

(3)

Contract rent adjustments; and

(4)

Project account (sometimes called “HAP reserve” or “project
reserve”) as previously established and maintained by HUD
pursuant to former Section 8(c)(6) of the United States
Housing Act of 1937 (currently Section 8(c)(5) of the Act, 42
U.S.C. § 1437f(c)(5)). Section 8(c)(5) does not apply to the
Renewal Contract, or to payment of housing assistance
payments during the Renewal Contract term.

The Renewal Contract includes those provisions of the Expiring
Contract that are renewed in accordance with this section 5.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
6

Attachment 13

6

CONTRACT RENT
a

Initial contract rents
At the beginning of the Renewal Contract term, and until contract
rents for units in the Project are adjusted in accordance with section
6b, the contract rent for each bedroom size (number of bedrooms)
shall be the initial contract rent amount listed in Exhibit A, which is
attached to and, by this reference, is hereby made a part of the
Renewal Contract.

b

Contract rent adjustments in accordance with the Plan of
Action
During the term of the Plan of Action, the Contract Administrator
shall adjust the amounts of the monthly contract rents in
accordance with the Plan of Action. See Exhibit B.

c

d

Procedure for rent adjustments during renewal term
(1)

To adjust contract rents during the term of the Renewal
Contract the Contract Administrator shall give the Owner
notice with a revised Exhibit A that specifies the adjusted
contract rent amounts.

(2)

The revised Exhibit A shall specify the adjusted contract
rent amount for each bedroom size as determined by the
Contract Administrator in accordance with this section. The
adjustment notice by the Contract Administrator to the
Owner shall specify when the adjustment of contract rent is
effective.

(3)

Notice of rent adjustment by the Contract Administrator to
the Owner shall automatically constitute an amendment of
the Renewal Contract.

No other adjustments
Except for contract rent adjustments in accordance with this
section, there shall not be any other adjustments of the contract
rents during the term of the Renewal Contract. Special
adjustments shall not be granted.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
7

Attachment 13

7

8

9

OWNER WARRANTIES
a

The Owner warrants that it has the legal right to execute the
Renewal Contract and to lease dwelling units covered by the
contract.

b

The Owner warrants that the rental units to be leased by the Owner
under the Renewal Contract are in decent, safe and sanitary
condition (as defined and determined in accordance with HUD
regulations and procedures), and shall be maintained in such
condition during the term of the Renewal Contract.

OWNER TERMINATION NOTICE
a

Before termination of the Renewal Contract, the Owner shall
provide written notice to the Contract Administrator and each
assisted family in accordance with HUD requirements.

b

If the Owner fails to provide such notice in accordance with the law
and HUD requirements, the Owner may not increase the tenant
rent payment for any assisted family until such time as the Owner
has provided such notice for the required period.

HUD REQUIREMENTS
The Renewal Contract shall be construed and administered in accordance
with all statutory requirements, and with all HUD regulations and other
requirements, including changes in HUD regulations and other
requirements during the term of the Renewal Contract. However, any
changes in HUD requirements that are inconsistent with the provisions of
the Renewal Contract, including the provisions of section 6 (contract rent)
shall not be applicable.

10

STATUTORY CHANGES DURING TERM
If any statutory change during the term of the Renewal Contract is
inconsistent with section 6 of the Renewal Contract, and if HUD
determines, and so notifies the Contract Administrator and the Owner, that
the Contract Administrator is unable to carry out the provisions of
section 6 because of such statutory change, then the Contract
Administrator or the Owner may terminate the Renewal Contract upon
notice to the other party.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
8

Attachment 13

11

12

PHA DEFAULT
a

This section 11 of the Renewal Contract applies if the Contract
Administrator is a PHA acting as Contract Administrator pursuant to
an annual contributions contract (“ACC”) between the PHA and
HUD. This includes a case where HUD has assigned the Renewal
Contract to a PHA Contract Administrator, for the purpose of PHA
administration of the Renewal Contract.

b

If HUD determines that the PHA has committed a material and
substantial breach of the PHA’s obligation, as Contract
Administrator, to make housing assistance payments to the Owner
in accordance with the provisions of the Renewal Contract, and that
the Owner is not in default of its obligations under the Renewal
Contract, HUD shall take any action HUD determines necessary for
the continuation of housing assistance payments to the Owner in
accordance with the Renewal Contract.

EXCLUSION OF THIRD-PARTY RIGHTS
a

The Contract Administrator does not assume any responsibility for
injury to, or any liability to, any person injured as a result of the
Owner's action or failure to act in connection with the Contract
Administrator’s implementation of the Renewal Contract, or as a
result of any other action or failure to act by the Owner.

b

The Owner is not the agent of the Contract Administrator or HUD,
and the Renewal Contract does not create or affect any relationship
between the Contract Administrator or HUD and any lender to the
Owner or any suppliers, employees, contractors or subcontractors
used by the Owner in connection with implementation of the
Renewal Contract.

c

If the Contract Administrator is a PHA acting as Contract
Administrator pursuant to an annual contributions contract (“ACC”)
between the PHA and HUD, the Contract Administrator is not the
agent of HUD, and the Renewal Contract does not create any
relationship between HUD and any suppliers, employees,
contractors or subcontractors used by the Contract Administrator to
carry out functions or responsibilities in connection with contract
administration under the ACC.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
9

Attachment 13

13

WRITTEN NOTICES
a

Any notice by the Contract Administrator or the Owner to the other
party pursuant to the Renewal Contract shall be given in writing.

b

A party shall give notice at the other party’s address specified in
section 1 of the Renewal Contract, or at such other address as the
other party has designated by a contract notice. A party gives a
notice to the other party by taking steps reasonably required to
deliver the notice in ordinary course of business. A party receives
notice when the notice is duly delivered at the party’s designated
address.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
10

Attachment 13

SIGNATURES
Contract administrator (HUD or PHA)
Name of Contract Administrator

By:
Signature of authorized representative
Name and official title
Date _________________________

U.S. Department of Housing and Urban Development
By:
Signature of authorized representative
Name and official title
Date ________________________

Owner
Name of Owner

By:
Signature of authorized representative
Name and title
Date ___________________________

Form HUD-9639
Preservation Renewal Contract
REV 10/09
11

Attachment 13

Form HUD-9639
Preservation Renewal Contract
REV 10/09
12

EXHIBIT A
IDENTIFICATION OF UNITS ("CONTRACT UNITS")
BY SIZE AND APPLICABLE CONTRACT RENTS
Section 8 Contract Number:
FHA Project Number (if applicable):
Effective Date of the Rent Increase (if applicable):

Number
of Contract Units

Number
of Bedrooms

Contract
Rent

Utility
Allowance

Gross
Rent

NOTE: This Exhibit will be amended by Contract Administrator notice to the
Owner to specify adjusted contract rent amounts as determined by the Contract
Administrator in accordance with section 6b of the Renewal Contract.

Form HUD-9639
Preservation Renewal Contract
REV 10/09
1

EXHIBIT B
PLAN OF ACTION
(Attached hereto)

Form HUD-9639
Preservation Renewal Contract
REV 10/09
2

INSTRUCTIONS FOR PREPARATION OF RENEWAL CONTRACT
The following instructions are not part of the Renewal Contract.
Endnote numbers are keyed to references in the text of the Renewal Contract.

1

This form of Renewal Contract is to be used for initial and subsequent
renewals of an expiring Section 8 project-based HAP contract for a project that is
subject to an approved Plan of Action under the Emergency Low-Income
Housing Preservation Act of 1987 (12 U.S.C. 1715l note) or the Low-Income
Housing Preservation and Residential Homeownership Act of 1990 (12 U.S.C.
1401 et seq.). Such renewals are entered pursuant to Section 524(e)(1) of
MAHRA.
This term of renewal on this form shall only provide for renewal during the term of
the Preservation Plan of Action, and shall not cover any period after the end of
the Plan of Action. The Basic Renewal Contract shall be used to renew for any
period after the period covered by the Plan of Action.
Section 2 of the Renewal Contract specifies the contract term.
2

To prepare the Renewal Contract for execution by the parties, fill out all
contract information in section 1 and section 2.
3

Enter a description of the housing that will be covered by the Renewal Contract.
The description must clearly identify the Project by providing the Project’s name,
street address, city, county, state and zip code, block and lot number (if known),
and any other information necessary to clearly designate the covered Project.
If necessary, attach an exhibit with a site plan, legal description or other
descriptive information. Enter a reference to the attached exhibit.
4

Enter the following information: the complete title of the Use Agreement or the
Regulatory Agreement; any revision(s) to the Use Agreement or Regulatory
Agreement; the date of each agreement; the names of the parties signing such
agreements; and all relevant recording information for each agreement. For
example: “Use Agreement and Amendment of Existing Regulatory Agreement,
dated as of February 1, 1997, between ABC Associates and the Secretary of

Form HUD-9639
Preservation Renewal Contract
Endnotes: INSTRUCTIONS FOR PREPARATION OF RENEWAL CONTRACT
REV 10/09
Page 1

Housing and Urban Development, recorded in the Recorder’s Office of Bergen
County, New Jersey, in Deed Book 1 at page 2.”
5

Enter the name of the Contract Administrator that executes the Renewal
Contract. If HUD is the Contract Administrator, enter “United States of America –
Department of Housing and Urban Development (HUD)”. If the Contract
Administrator is a public housing agency (“PHA”), enter the full legal name of the
PHA.
6

Enter the full legal name of the Owner. For example: “ABC Corporation, Inc., a
Maryland corporation.”
7

The Renewal Contract must be entered before expiration of the Expiring
Contract. Enter the date of the first day after expiration of the term of the
Expiring Contract.
8

Enter a whole number of years.

9

Enter the amount of funding obligated.

10

Enter a whole number of months.

Form HUD-9639
Preservation Renewal Contract
Endnotes: INSTRUCTIONS FOR PREPARATION OF RENEWAL CONTRACT
REV 10/09
Page 2


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