PBV Project Selection: When Competition Is Required and When It Isn't
PBV project selection normally requires a competitive process, but current HUD rules give public housing agencies several specific ways to select a project without holding a new competition. The distinction depends on which selection route in 24 CFR 983.51 actually applies—not simply on whether the project is affordable, PHA-owned, or connected to former public housing.
A PHA must explain in its Administrative Plan when it will use competitive and noncompetitive selection and how proposals or projects will be evaluated. Before selecting anything, the agency also has to determine that the project satisfies applicable PBV requirements, including housing eligibility, the project cap and site-selection standards.
The Two Competitive Routes Are Not the Same
A PHA can competitively select a PBV proposal in two ways.
The first is a PHA-issued request for proposals. The PHA publishes an opportunity for owners or other eligible entities to submit PBV proposals and evaluates those proposals under the procedures stated in its Administrative Plan.
The second route uses a qualifying competition that already occurred under another Federal, State or local government housing assistance, community development or supportive-services program. In that situation, the PHA does not have to issue a second PBV RFP if the earlier competition satisfies HUD's conditions.
The Project-Based Voucher program gives PHAs substantial local implementation responsibility, but project selection still has to stay within these federal rules.
A PHA RFP Must Offer a Real Competitive Opportunity
When the PHA conducts its own competition, its RFP cannot be written around a single predetermined site in a way that prevents competing owners from offering PBV housing at other sites.
The PHA may coordinate the PBV competition with another government housing, community-development or supportive-services competition. Combining processes does not transfer responsibility for PBV compliance to the other agency. The PHA remains responsible for meeting §983.51.
Public notice must be broad enough to provide a genuine opportunity for interested parties to learn about the RFP. The notice must include the proposal deadline, and detailed selection information must be available to interested parties.
A Recent Government Competition Can Replace a New PBV RFP
A separate PHA RFP is not always necessary when a project has already won another qualifying government competition.
Current PBV rules allow the PHA to select housing that was competitively selected under a Federal, State or local housing assistance, community-development or supportive-services program if that selection occurred within three years before the PBV proposal selection date.
There is an important restriction: the earlier competition cannot have considered the expectation that the project would receive PBV assistance.
In practical terms, a project cannot create a circular selection process in which PBVs helped it win the earlier competition and that earlier award is then used as the reason to avoid a PBV competition.
Noncompetitive Selection Is an Exception, Not a General PHA Option
A PHA cannot simply decide that competition would be inconvenient and choose a preferred development directly. Noncompetitive PBV project selection must fit one of the regulatory exceptions in §983.51(c).
Before using those exceptions, the PHA must notify the public of its intent to noncompetitively select one or more PBV projects through its 5-Year Plan.
The PHA's Administrative Plan must also describe the circumstances in which the agency will use competitive and noncompetitive selection methods.
Public Housing Redevelopment Can Qualify for Direct Selection
One major exception applies when a PHA is engaged in an initiative to improve, develop or replace a public housing property or site.
The PHA may noncompetitively select an existing, newly constructed or rehabilitated project in which it has an ownership interest or over which it has control when the project fits that public-housing initiative.
For replacement housing, the replacement does not have to be built on the same site as the former public housing. The number of PBV contract units in the replacement project, however, generally cannot exceed the number of units in the original public housing project by more than a de minimis amount for this particular exception to apply.
The public housing property may still be in the public housing inventory at selection, or it may have been removed through an available legal removal tool within the five years preceding the PBV project selection date.
Some Replacement Projects Without PHA Ownership Also Qualify
Current regulations contain a separate repositioning exception for certain projects where the PHA administering the PBV assistance does not own or control the selected replacement project.
This route has narrower conditions. Among them:
- The underlying public housing project must still be in the inventory or have been removed within the previous five years.
- The PHA that owns or owned that public housing project must not administer the HCV program.
- The selected project must have been specifically identified as replacement housing for affected public housing residents in the HUD-approved demolition, disposition, voluntary-conversion or other public-housing removal process.
- The applicable replacement-unit limitation must be satisfied.
This exception is why a former public housing connection can matter, but simply calling a development a “replacement project” is not enough. The HUD-approved removal record and the regulatory conditions control.
PHA-Owned Status Creates Another Exception, but Not Automatic Approval
Section 983.51 also permits a PHA to noncompetitively select a project consisting of PHA-owned units as that term is defined under the HCV regulations.
That does not mean every PHA-owned development automatically receives PBVs.
The project still has to satisfy the PHA's Administrative Plan procedures and the other applicable PBV requirements. The PHA must have given the required public notice of its intent to use noncompetitive selection, and the selection process for PHA-owned units is subject to an additional independent review safeguard.
A HUD field office or qualifying independent entity must review the selection process and determine that the PHA appropriately selected the project under the procedures in its Administrative Plan.
For a project selected through the specific PHA-owned noncompetitive exception, the units also must continue meeting the regulatory PHA-owned definition during the first two years of the HAP contract unless HUD approves a transfer of ownership.
PHA-Owned Projects Cannot Be Favored Inside an Ordinary Competition
The distinction between a valid noncompetitive exception and a normal competition matters.
If a PHA-owned proposal is being considered through a competitive selection process rather than one of the §983.51(c) exceptions, the competition cannot be structured to effectively shut out non-PHA-owned projects or give PHA-owned units preferential treatment simply because the PHA owns them.
For example, the regulations specifically identify extra scoring points for PHA ownership as the kind of preference that cannot be built into an ordinary competitive process.
PHA ownership also triggers independent-entity requirements beyond selection. Certain inspections, rent determinations and other PBV functions must be handled independently rather than having the PHA make decisions about its own property.
Enhanced-Voucher Situations Create One More Narrow Exception
Current §983.51 includes another noncompetitive route for a project that underwent a qualifying eligibility event within five years before selection.
This route applies when one or more families qualify for enhanced voucher assistance under Section 8(t) and provide informed consent to relinquish that enhanced voucher assistance in exchange for PBV assistance.
This is a specialized exception tied to enhanced-voucher circumstances. It is not a general way to convert an ordinary privately owned property into a noncompetitively selected PBV project.
The Administrative Plan Controls How the PHA Uses These Routes
The federal regulation establishes which selection methods are legally available. The PHA's Administrative Plan establishes how that particular agency will use them.
The plan must describe:
- The procedures for submitting and selecting PBV proposals.
- The circumstances in which the PHA will use competitive selection.
- The circumstances in which it will use available noncompetitive exceptions.
- Applicable selection procedures and local policy choices required by Part 983.
A regulatory exception therefore does not mean every PHA has adopted the same procedure for using it. The current Administrative Plan is a critical document when reviewing a specific selection.
The PHA Must Check Capacity Before It Starts Selecting Projects
Project selection is not only about which proposal scores highest or qualifies for an exception.
Before issuing an RFP, relying on a prior competition or making a noncompetitive selection, the PHA must determine how many authorized voucher units it is permitted to project-base and whether sufficient budget authority is available.
If project-basing would reach 50 percent or more of the PHA's authorized voucher units, the PHA must also perform an impact analysis considering the effect on the agency's tenant-based and project-based voucher portfolio, including people on the waiting list and PBV families seeking choice-mobility moves.
That impact analysis becomes part of the public record.
Selection Still Requires a Project-Level Eligibility Review
Winning a competition or satisfying a noncompetitive exception does not override the rest of the PBV regulations.
Before selection, the PHA must determine that the proposed project complies with applicable program requirements. That includes issues such as:
- Whether the housing is eligible for PBV assistance.
- Whether prohibited subsidized-housing combinations apply.
- Whether the project complies with the applicable PBV unit cap.
- Whether the site satisfies PBV site-selection standards.
- Whether sufficient program authority and budget exist.
The classification of the units can also affect later development requirements. The distinction among existing, newly constructed and rehabilitated PBV housing determines what development path follows project selection.
Competitive Selections Require Written and Public Notice
After choosing a proposal through one of the competitive methods, the PHA must promptly send written notice to the party that submitted the selected proposal and also provide public notice of the selection.
The written notice must require the selected party to respond in writing and accept the terms and requirements stated by the PHA.
For competitive selection, the proposal selection date is the date the PHA provides that written selection notice.
This date matters elsewhere in the PBV regulations because several requirements use the proposal or project selection date as a regulatory reference point.
Noncompetitive Projects Require a Board Resolution
The documentation path is different when the PHA uses an exception to competition.
The PHA board must approve project-basing assistance at the specific project. The project selection date is the date of that board resolution.
After the resolution, the PHA must promptly provide written notice of project selection to the owner. The owner must respond in writing accepting the terms and requirements stated in the notice.
This creates a documented event establishing when the noncompetitive PBV project was actually selected.
The Public Can Inspect the Basis for the Selection
Section 983.51 requires the PHA to make documentation showing the basis for its PBV proposal or project selection available for public inspection.
That requirement applies regardless of whether selection came from an RFP, a qualifying previous competition or an exception to competition.
For someone reviewing a specific project, the relevant record may therefore include the Administrative Plan, public notice, RFP or prior competition record when applicable, selection analysis, board action for a noncompetitive selection and the PHA's documentation explaining why the selected route applied.
Conflict-of-Interest Rules Apply to the Selection Environment
PBV project selection does not operate outside the HCV conflict-of-interest rules.
Federal regulations restrict certain PHA officials, employees, contractors, public officials and other covered individuals from holding prohibited direct or indirect interests in HCV-related contracts or arrangements during the applicable period.
A covered person with an interest or prospective interest must disclose it to the PHA and HUD. HUD's field office may waive the regulatory conflict prohibition for good cause when the requirements for a waiver are met.
PBV owners also have disclosure obligations for possible conflicts that would violate the HAP contract, a Development Agreement when applicable, or HUD regulations.
Debarred or Excluded Parties Cannot Receive a PBV Commitment
There is another safeguard separate from ordinary proposal scoring. A PHA may not commit PBV assistance to a proposal or project when the owner or a principal or interested party is debarred, suspended, subject to an applicable limited denial of participation or otherwise excluded under the governing Federal rules.
This restriction applies even if the proposal would otherwise qualify under the PHA's selection method.
Do Not Judge a Selection From the Word “Noncompetitive” Alone
A noncompetitive PBV selection is not automatically improper. Current federal regulations expressly authorize several noncompetitive routes.
Likewise, PHA ownership, public-housing redevelopment or an earlier government award does not by itself establish that a project was properly selected.
The reliable test is to identify the actual §983.51 route, then confirm that the PHA followed its Administrative Plan, satisfied the public-notice and documentation requirements, completed any required board or independent review, and determined that the project met the other PBV requirements before selection.