Conversion to rental assistance demonstration programs in Chattanooga

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CHATTANOOGA, Tenn. (WDEF) — Some traditional public housing residents in Chattanooga will see some changes when it comes to their rent.

At the Chattanooga Housing Authority’s board meeting they approved the conversion of flat rents to income based rents in the rental assistance demonstration program.

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“under public housing, residents have the option of either paying their income based rent, which is 30 percent of their adjusted income or they have the option of paying flat rent, but under the voucher based programs, whether tenant based, project based or PBRA the concept of flat rent doesn’t exist. So we have to get folks that have been on flat rent to transition to the regular income based rent.,” said Mike Sabin, with the Chattanooga Housing Authority.

“That agenda item was part of the conversion from traditional public housing units into elderly high rises to HUDs rental assistance demonstration program. The Rental assistance demonstration program basically changes the character of the units to more of a voucher based environment and this particular agenda item is just addressing a slight regulatory difference between the two programs,” said Betsy McCright, executive director with the Chattanooga Housing Authority.

McCright says with this conversion they can fix properties if needed.

“in traditional public housing we are not allowed to leverage the value of the land of the buildings we own to secure loans, to improve the property. But under RAD we essentially take away that public housing prohibition and we are able to apply for conventional loans and other things to bring the properties into better condition,” McCright said.

There are some rules for the transformation.

“if there is an increase in rent that is going to be more than 10 percent or $25 a month in the rent then you are going to have a phase in from three to five years,” Sabin said.

The board approved to phase that in over three years.