Housing Affordability Statement

Housing Affordability

IREM Position:
IREM believes that it is the responsibility of a subsidized tenant, and not the property manager, to ensure that utility service is maintained in the tenant's unit by providing regular and timely payment of utility bills when service is provided directly to the tenant. IREM also believes that tenants who fail to maintain utility service present a danger to themselves and the property and should be duly and expeditiously evicted. In order to comply with the housing quality standards associated with subsidy programs, managers of subsidized housing should be notified by utility companies when the utilities of a subsidized tenant are turned off for failure to pay. When utility companies refuse to notify managers that utilities have been turned off, HUD should continue the subsidy until the tenant is duly evicted for failure to maintain utility service. 

(Adopted 10/23)

Housing Trust Funds

IREM Position:
The Institute of Real Estate Management supports the concept of safe, decent and sanitary housing, the production of new low/moderate income housing, and the preservation of the existing housing inventory. IREM feels that the best and most efficient means of creating local low/moderate income housing is through state finance agencies, not through additional funding via interest-bearing escrow accounts. The use of housing trust interest-bearing escrow accounts will have an adverse effect on rent pricing and will adversely affect the original intent of security deposits.

(Updated 11/04, 9/12, 10/23)

HUD Reforms Bankruptcy

IREM Position:
IREM supports the current bankruptcy code because the existing code provides for due process of law, therefore should remain intact. We find proposals to amend section 105 and 362 of the Bankruptcy Code (Title 11 of the United States Code as recodified by the Bankruptcy Reform Act of 1978) unacceptable for several reasons:

  • The proposal could be unconstitutional because it does not provide for due process.
  • The existing bankruptcy law has allowed for due process of law.; therefore, it should remain intact. The Institute believes that the examples that HUD gives to support its proposed reform are isolated incidents and represent aberrations rather than the norm.

(Adopted 11/89. Updated 1/91, 4/05, 8/12, 10/23)

HUD Reforms: Civil Money Penalties

IREM Position:
The Institute of Real Estate Management is aware that there are cases of "recalcitrant owners and managing agents" that HUD must address. However, the Institute believes that adding managing agents to the proposed civil penalties authority represents overkill on the part of HUD and is an inappropriate response to these problems for the following reasons:

  • Use of this authority could be arbitrary. Due process should be afforded before civil money penalties are enforced on general partners or managing agents. During due process it must be determined which party is actually in control of making a specific decision. In most cases, managing agents take direction from general partners or mortgagors.
  • The application of civil penalties as proposed is open to abuse. The possibility exists that a difference of opinion could be deemed a "violation" by HUD and penalized. What constitutes a reasonable, proper, or necessary expense may be subject to interpretation or conflict between HUD and managing agents or owners, and may even vary from one HUD region to another. At a minimum, there should be ample notice to those deemed to be in violation to give them an opportunity to correct problems.
  • The managing agent shall only be liable for his or her own gross acts of unlawful misconduct or negligence.
  • Any civil money penalties imposed should stay with the property and be used for the benefit of the property.
  • When civil money penalties are imposed, they should be only compensatory to recoup the cost of damages and, should be used for the benefit of the property.
  • IREM believes that objectivity is of primary importance at each stage of the civil money penalties process including the deliberations of the Housing Civil Penalties Panel (HCPP). IREM feels that, under the current selection process, there is no way to make the panel objective.

(Adopted 11/93. Updated 4/05, 8/12, 10/23)

Management and Occupancy Reviews (MORs)

IREM Position:
IREM believes that MORs are an important part of the management review process. MORs help the performance of a property and demonstrate strong management operations and areas for improvements. They are also helpful in demonstrating to Congress that the HUD portfolio is well managed so as to ensure continued support of the program. HUD should ensure that MORs are conducted on a regular basis, and reports provided to owner/managers in a timely manner.

(Adopted 10/12. Updated 10/17, 10/23)

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