HOTMA is Coming: 4 Key Elements To Successful Implementation

HUD recently announced that the HOTMA Final Rule’s effective date for Multifamily Programs remains January 1, 2024. However, HUD has acknowledged how substantial of a program shift this will be for all stakeholders, as it will impact everyday interviewing, recertifying, and rent calculation tasks performed by site staff. Therefore, implementation will be an ongoing process that occurs during 2024, culminating in a final new implementation deadline of December 31, 2024.

HOTMA, the Housing Opportunity Through Modernization Act, is intended to minimize administrative burdens associated with (re)certifying households and to ensure limited rental assistance funds are appropriately spent housing families that need it most. To achieve these goals, HUD introduced the most comprehensive changes to occupancy requirements that the industry has seen in several decades. Whether owners have five or 500 HUD units, they must correctly incorporate applicable HOTMA requirements and train staff on these crucial operational changes.    

As site level staff work to incorporate HOTMA regulations at their property, here are 4 key themes to remember that will aid in making your HOTMA implementation organized and successful:

• Everyone in the HUD Multifamily Housing Programs – from property owners and executive leadership to compliance managers, software developers, and frontline staff – should understand the regulatory changes. These are not the type of changes you familiarize yourself with on a Thursday and fully implement on the following Monday. The process takes time.  Don’t procrastinate – especially because many of the deadlines are staged throughout 2024.

• Owners must update existing written policies and procedures and create entirely new ones to comply with guidance introduced in the HOTMA Final Rule – many by March 31, 2024. For example, Tenant Selection Plans, EIV Policies and Procedures, and House Rules must all be updated with sweeping changes by the March deadline. All owners and agents will have to create Financial Hardship Policies not previously required.  Applications and Recertification documents and forms used will also require substantial updates to reflect new verification protocol.  Who on your team will be tasked with creating new policies and effectively updating existing policies with appropriate language?    

• Proactive tenant notification must be clear and inclusive. HOTMA introduces several changes that directly impact tenant rent calculations and the recertification process – changes your households will immediately notice.  

Piecemeal notifications on singular, focused topics will likely be more easily understood than a lengthy memo or newsletter with an overwhelming number of changes presented simultaneously.  And don’t forget – federal law requires housing professionals provide equal access and effective communication to all applicants/residents. You’ll need to ensure you include those that require accommodations for disabilities or have limited English proficiency.  

• The TRACS Version 2.0.3.A software update is a mandatory technology enhancement all owners will need to incorporate HOTMA changes. ResMan is actively involved in the TRACS 2.0.3.A development initiative and works closely with a consortium of industry stakeholders collaborating to successfully implement HOTMA regulatory changes within TRACS software platforms. ResMan will be finalizing their development of these changes based on the Supplemental Notice issued and when the resulting TRACS Specifications are published by HUD.  Without TRACS 2.0.3.A, full implementation of HOTMA regulations cannot occur.  

"The first step toward change is awareness. The second step is acceptance." - Nathaniel Branden

Change can be as scary as it is necessary. Knowledge is power. Being informed about industry changes as significant as HOTMA positions owners to educate their resident populations about how these changes impact their lives. If you need assistance, don’t hesitate to reach out to our team; we have customized policies with HOTMA updates to help make your adaptation to these new leasing practices smooth and efficient.  

Successful implementation of HOTMA changes is achievable. Are you ready to be part of the team that gets it done?  

Jenny DeSilva is the President and CEO of DeSilva Housing Group and has nearly 25 years of experience in affordable housing. She is a recognized industry compliance expert with extensive consulting and training knowledge in HUD's Multifamily Housing programs.