Seven Things You Need to Know NOW About Relocation

Thinking about using federal funds with your rental rehabilitation project?  Here are seven things to keep in mind before dusting off the hammer and wrecking bar:

1.  HUD cares about this.  The federal government takes the rights of tenants in rental rehabilitation properties very seriously.

2.  So should we.  Grantees and developers who are working on HUD-funded projects need to understand that the Uniform Relocation Act (URA) is basic consumer legislation that addresses fairness issues:

  • Tenants whose living circumstances are changed by a project, either by higher rents or involuntary moves, should be protected and compensated.

3.  The relocation rules are not all one-sided.  There are actions that can be taken to control costs and prevent displacement:

  • These actions include informing tenants about the project, treating them fairly during the process, staging work if it is feasible, and keeping their rents affordable.
  • Tenants must continue to pay rent and comply with the lease during the process.

4.  Mistakes can be costly.  Planning for relocation and tenant concerns is critical because grantees, owners, and sub-recipients can all take actions, which can incur a financial liability for the jurisdiction:

  • Displaced Tenants are entitled to 42 or 60 months of rental assistance, depending on the situation.  Claims could exceed $10,000.
  • Although some claims are unavoidable, there is no reason to incur these costs by failure to follow the rules.

5.  Planning is critical.  Relocation concerns must be thought about EARLY in the process so decisions about rents, construction timing, and project feasibility can be considered before they are a crisis.

6.  Cooperation is essential.  All parties involved in the project - the various departments in the funding jurisdiction, sub-recipients, and developers must "do the right thing" in order to make the process work.

7. There are three basic requirements for tenants in rental rehabilitation projects:

  • They must be given timely information about the pending application.  If the project is approved, they must be advised about any changes that will occur to their situation.  If they are not advised, and move, they could claim that they were displaced even if that was not intended.
  • If they must be displaced, they must be offered a comparable replacement unit that is decent, safe, and sanitary.  Moving expenses must be paid.  No one can be required to move without 90 days notice.
  • Tenants who will stay in the property after work is complete must be offered a suitable unit that is decent, safe, and sanitary and affordable to them.

For more information about relocation requirements contact, Lisa Bondy, Housing Research and Development Officer, at (605) 773-3445 or lisab@sdhda.org.