Section 983.154 - [Effective on an indefinitely delayed date ] Development agreement(a)Agreement to enter into HAP contract (Agreement). Except as specified in paragraphs (f) and (g) of this section, the PHA and owner must enter into an Agreement that will govern development activity. In the Agreement, the owner agrees to develop the contract units to comply with HQS, and the PHA agrees that, upon timely completion of such development activity in accordance with the terms of the Agreement, the PHA will enter into an initial HAP contract with the owner for the contract units. The Agreement must cover a single project, except one Agreement may cover multiple projects that each consist of a single-family building.(b)Timing of Agreement. The effective date of the Agreement must be on or after the date the Agreement is executed. The Agreement must be executed and effective prior to the commencement of development activity as described in paragraph (d) of this section, except as provided in paragraphs (f) and (g) of this section, and must be in the form required by HUD (see 24 CFR 982.162(b) ).(c)Agreement amendment. The PHA and owner may agree to amend the contents of the Agreement described in paragraph (e) of this section by executing an addendum to the Agreement, so long as such amendments are consistent with all requirements of this part 983. The PHA and owner may only execute an addendum affecting a unit prior to the PHA accepting the completed unit.(d)Commencement of development activity. Development activity must not commence after the date of proposal submission (for housing subject to competitive selection) or the date of the PHA's board resolution approving the project-basing of assistance at the project (for housing excepted from competitive selection) and before the effective date of the Agreement, except as provided in paragraphs (f) and (g) of this section.(1) In the case of new construction, development activity begins with excavation or site preparation (including clearing of the land).(2) In the case of rehabilitation, development activity begins with the physical commencement of rehabilitation activity on the housing.(e)Contents of Agreement. At a minimum, the Agreement must describe the following features of the housing to be developed and assisted under the PBV program and development activity to be performed:(2) The location of contract units on site;(3) The number of contract units by area (square footage) and number of bedrooms and bathrooms;(4) The services, maintenance, or equipment to be supplied by the owner without charges in addition to the rent to owner;(5) The utilities available to the contract units, including a specification of utility services to be paid by the owner (without charges in addition to rent) and utility services to be paid by the tenant;(6) A description of any required work item necessary to comply with the accessibility requirements of § 983.153(e) ;(7) A description of any required work item if the requirement at § 983.153(f) to install broadband infrastructure applies;(8) Estimated initial rents to owner for the contract units;(9) A description of the work to be performed under the Agreement: (i) For rehabilitation, the work description must include the rehabilitation work write-up and, where determined necessary by the PHA, specifications and plans (see paragraph (g) of this section for additional requirements that apply under the option for development activity after HAP contract at 983.157); and(ii) For new construction, the work description must include the working drawings and specifications;(10) The deadline for completion of the work to be performed under the Agreement; and(11) Any requirements the PHA elects to establish in addition to HQS for design, architecture, or quality. The PHA must specify the conditions under which it will require additional housing quality requirements in the Administrative Plan.(f)PHA discretion. With respect to development activity, the PHA may decide not to use an Agreement or may choose to execute an Agreement after construction or rehabilitation that complied with applicable requirements of § 983.153 has commenced. (1) In its Administrative Plan, the PHA must explain the circumstances (if any) under which the PHA will enter a PBV HAP contract for newly constructed or rehabilitated housing without first entering into an Agreement and under which the PHA will enter into an Agreement after construction or rehabilitation that complied with applicable requirements of § 983.153 has commenced.(2) The following conditions apply: (i) The owner of the project must be able to document its compliance with all applicable requirements of § 983.153 from the date of proposal submission (for housing subject to competitive selection) or from the date of the PHA's board resolution approving the project-basing of assistance at the project (for housing excepted from competitive selection);(ii) For housing subject to competitive selection, the PHA must confirm prior to the proposal selection date that the owner has complied with all applicable requirements of § 983.153 from the date of proposal submission. For housing excepted from competitive selection, the PHA must confirm prior to executing the Agreement (if applicable) or HAP contract that the owner has complied with all applicable requirements of § 983.153 from the date of the PHA's board resolution approving the project-basing of assistance at the project; and(iii) The PHA must comply with the notice requirement of § 983.153(c)(3) .(g)Rehabilitated housing option: development activity during HAP contract term. The PHA may permit some or all development activity to occur during the term of the HAP contract under the rehabilitated housing option in § 983.157 . Under this option, the PHA may choose to execute an Agreement for any development activity undertaken before the HAP contract is effect. If the PHA will execute an Agreement for development activity undertaken before the HAP contract is effective, the work description required per paragraph (e)(9)(i) of this section must specify the work activities that will be performed during the term of the Agreement.(h)PHA-owned units. For PBV projects containing PHA-owned units that are not owned by a separate legal entity from the PHA (e.g., an entity wholly controlled by the PHA or a limited liability company or limited partnership owned by the PHA), the PHA must choose one of the following options if it does not exercise its discretion at paragraphs (f) or (g) of this section not to use an Agreement: (1) Prior to execution of the Agreement, the PHA must establish a separate legal entity to serve as the owner. That separate legal entity must execute the Agreement with the PHA. The separate legal entity must have the legal capacity to lease units and must be one of the following: (i) A non-profit affiliate or instrumentality of the PHA;(ii) A limited liability corporation;(iii) A limited partnership;(v) Any other legally acceptable entity recognized under State law.(2) The PHA signs the HUD-prescribed PHA-owned agreement certification covering a PHA-owned unit, instead of executing the Agreement for the PHA-owned unit. By signing the PHA-owned agreement certification, the PHA certifies that it will fulfill all the required program responsibilities of the private owner under the Agreement, and that it will also fulfill all of the program responsibilities required of the PHA for the PHA-owned unit.(i) The PHA-owned agreement certification serves as the equivalent of the Agreement, and subjects the PHA, as owner, to all of the requirements of the Agreement contained in parts 982 and 983. Where the PHA has elected to use the PHA-owned agreement certification, all references to the Agreement throughout parts 982 and 983 must be interpreted to be references to the PHA-owned agreement certification.(ii) The PHA may not use the PHA-owned agreement certification if the PHA-owned PBV project is owned by a separate legal entity from the PHA (e.g., an entity wholly controlled by the PHA or a limited liability corporation or limited partnership controlled by the PHA).70 FR 59913, Oct. 13, 2005, as amended at 85 FR 61568, Sept. 29, 2020 85 FR 61568, 11/30/2020; 89 FR 38318, 6/6/2024; 89 FR 38321, effective date to be determined