Among the purposes of PETRA is to preserve affordable housing for the long term, yet during Phase One, it seems that only some multifamily properties are eligible to convert. Why is that?
In its FY11 budget, HUD requested $350 million for Phase One of TRA. Of that amount, $290 million is intended to cover the increased subsidy cost associated with converting properties from legacy programs like public housing and Rent Supp/RAP to property-based assistance under PETRA. The decision to extend Phase One eligibility to properties assisted under the Rent Supplement, Rental Assistance Program, and Section 8 Moderate Rehabilitation programs was based on the fact that these properties otherwise lack a viable preservation strategy. For example, Rent Supplement and Rental Assistance Program contracts are not renewable upon expiration; properties assisted under the Section 8 Moderate Rehabilitation program face renewal terms that make it nearly impossible for them to leverage the capital needed to support their long-term preservation as affordable housing. The urgency associated with preserving these properties is the reason for including them in Phase One.
