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Displaced Renters

Renters displaced by homeowner participation in a buyout, elevation, or home repair program may be entitled to limited relocation assistance through the Uniform Relocation Act which establishes minimum standards for all federally-funded projects that acquire property or displace persons from their homes, businesses or farms. The applicable federal regulations are located at 49 CFR Part 24 (URA).

Displacement due to CDBG-DR activity:

Both FEMA and CDBG funds are subject to the requirements of the URA; however, CDBG funds are subject to Section 104(d), while FEMA funds are not. The relocation assistance requirements at Section 104(d)(2)(A) of the Housing and Community Development Act and 24 CFR 42.350 are waived to the extent that they differ from the requirements of the URA and implementing regulations at 49 CFR Part 24, as modified by the notice for activities related to disaster recovery. Without this waiver, disparities exist in relocation assistance associated with activities typically funded by HUD and FEMA (e.g., buyouts and relocation).

The URA provides that a displaced person is eligible to receive a rental assistance payment that covers a period of 42 months. By contrast, Section 104(d) allows a lower-income displaced person to choose between the URA rental assistance payment and a rental assistance payment calculated over a period of 60 months. This waiver of the Section 104(d) requirements assures uniform and equitable treatment by setting the URA and its implementing regulations as the sole standard for relocation assistance under the federal register notice.

Displacement due to FEMA activity:

Tenant displaced from a dwelling as a result of a federally funded property acquisition and structure demolition or relocation project is entitled to a rental increase payment if:

  • The tenant rents or purchases and occupies a decent, safe, and sanitary replacement dwelling within 1 year after the date he or she moves out of the original dwelling, and
  • The tenant occupied the displacement dwelling for the 90 days preceding the initiation of negotiations for acquisition of the property.

The initiation of negotiations is defined as the first formal indication that the subrecipient wants to purchase a particular property. Any tenant who occupied the dwelling before a disaster event is usually eligible. The exception is if the project negotiations are unrelated to the disaster event or begin so long after the event that the event is no longer a relevant factor. If the dwelling is re-inhabited after the event, former tenants are generally not eligible. A signed lease is preferable for proving tenancy, but other documentation, such as utility bills, may be used to prove tenancy if a signed lease is not available because of the disaster event.

Compensation for a rent increase is 42 times the amount that is obtained by subtracting the “base monthly rent” for the displacement dwelling from the monthly rent and average monthly cost of utilities for a comparable replacement dwelling, or the decent, safe, and sanitary replacement dwelling now occupied by the displaced person.

The “base monthly rent” for the displacement dwelling is the lesser of the average monthly cost for utilities plus the rent at the displacement dwelling as determined by FEMA, or 30 percent of the tenant’s average gross household income. The rental increase payment may not exceed a total of $7,200.