{"id":29648,"date":"2024-07-25T16:54:38","date_gmt":"2024-07-25T20:54:38","guid":{"rendered":"https:\/\/www.carh.org\/?p=29648"},"modified":"2024-07-25T16:54:38","modified_gmt":"2024-07-25T20:54:38","slug":"rd-management-fees-published-for-fiscal-year-2025","status":"publish","type":"post","link":"https:\/\/www.carh.org\/rd-management-fees-published-for-fiscal-year-2025\/","title":{"rendered":"RD Management Fees Published for Fiscal Year 2025"},"content":{"rendered":"

BROADCAST EMAIL \u2013 Regulatory Update<\/strong><\/p>\n

July 25, 2024<\/strong><\/p>\n

On July 19th<\/sup>, Rural Development (RD) published Procedural Notice (PN) 619<\/a><\/strong> announcing management fees for Fiscal Year (FY) 2025. Management fees vary from state-to-state as RD based this year\u2019s increase on HUD\u2019s Operating Cost Adjustment Factor (OCAF) which varies based on location in the country and is applied to each state\u2019s current maximum fee. Except for FY 2023 when RD based the management fee increases on HUD\u2019s FY 2022 Income Limits, they have used OCAF as the base since FY 2015.<\/p>\n

To view the chart listing your state\u2019s FY 2023 management fee adjustment, visit pages 56-57 of Attachment 3-F, Chapter 3 of HB-2-3560<\/a><\/strong>. Note, the 2nd<\/sup> column on the management fee list, shows where management fees were increased to a minimum of $80 for states that had a FY 2024 management fee of less than $80. (Those states are Alabama, Alaska, Arizona, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Mexico, Ohio, Puerto Rico, Tennessee, Utah, Virgin Islands, West Virginia, Wisconsin, and Wyoming.) CARH over the last year had discussed with RD officials the need to increase the minimum fee for those states. The minimum fee was established many years ago. The cost of managing properties continues to increase and the minimum fees that had previously been used did not reflect actual property operations. \u00a0Thank you to the efforts of management committee members who advocated for higher base fees to officials in the national RD office. The third column provides the OCAF adjustment percentage, and the final column provides the final FY 2025 fee rounded up to the nearest dollar. RD had informed attendees to CARH\u2019s Annual Meeting and Legislative Conference that the adjustments outlined in the PN would be made.<\/p>\n

The PN includes allowable add-on fees of $5.00 per unit per month. CARH has advocated for add-on fees since 2014 and RD began making them available beginning with the FY 2021 budgets. See section 3.8 B.2 (page 3-16) of the PN for the list of add-on fees. Of particular interest to many CARH members is the $5.00 add-on fee for properties where there are multiple subsidies (i.e., reporting requirements in addition to and separate from Low-Income Housing Tax Credits or project-based Section 8).<\/p>\n

For those properties wanting to claim the add-on fee for management of properties in a remote location, beginning in FY 2023, RD provided a definition of \u201cremote location\u201d as those properties located within the USDA Economic Research Service (ERS) Level 4 Frontier & Remote (FAR) Area codes<\/a><\/strong>. According to the PN, \u201cthe following states\/territories do not have areas that meet the Level 4 FAR definition: Connecticut, Delaware, Indiana, Massachusetts, New Jersey, Ohio, Puerto Rico, Rhode Island, South Carolina, and the Virgin Islands. Properties in Alaska or Hawaii that are authorized to take the \u201coff-road\u201d management fee are not eligible to claim an additional add-on fee for remote location. If the property does not suffer difficulty retaining staff, obtaining services, or if management offices are located near the Level 4 FAR property, management should refrain from claiming this add-on fee.<\/strong> If a property is not located in a Level 4 FAR area, and management can justify a remove location add-on fee, they may request an exception. Reasonable justification must be submitted to the MFH servicing specialist for review. Justifications could include extensive travel time, difficulty obtaining services or retaining staff, or required unique means of travel (4-wheel drive, ferry, etc.).\u201d<\/p>\n

CARH will continue our discussions with RD regarding any future concerns regarding management fees. Please contact the CARH National Office at carh@carh.org<\/a><\/strong>\u00a0or 703-837-9001 should you have questions or concerns.<\/p>\n

For other news and information affecting the affordable rural housing industry, please visit the Newsroom on CARH\u2019s website, www.carh.org<\/a><\/strong>.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

BROADCAST EMAIL \u2013 Regulatory Update July 25, 2024 On July 19th, Rural Development (RD) published Procedural Notice (PN) 619 announcing management fees for Fiscal Year (FY) 2025. Management fees vary from state-to-state as RD based this year\u2019s increase on HUD\u2019s Operating Cost Adjustment Factor (OCAF) which varies based on location in the country and is…<\/p>\n","protected":false},"author":263,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_cbd_carousel_blocks":"[]","footnotes":""},"categories":[1],"tags":[],"class_list":["post-29648","post","type-post","status-publish","format-standard","hentry","category-uncategorized","category-1","description-off"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/posts\/29648","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/users\/263"}],"replies":[{"embeddable":true,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/comments?post=29648"}],"version-history":[{"count":1,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/posts\/29648\/revisions"}],"predecessor-version":[{"id":29649,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/posts\/29648\/revisions\/29649"}],"wp:attachment":[{"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/media?parent=29648"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/categories?post=29648"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.carh.org\/wp-json\/wp\/v2\/tags?post=29648"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}