Section 8 Moderate Rehabilitation Single Room Occupancy (Section 8 Mod Rehab SRO)

The purpose of the McKinney/Vento Section 8 Moderate Rehabilitation Single Room Occupancy (SRO) program is to bring more SRO properties into the local housing supply and to use those units to benefit homeless people.

Through this program, HUD provides a project-based rental subsidy for SRO units. Generally, tenants pay 30 percent of their income for rent, the rental subsidy pays that difference between the tenant share and 120 percent of the unit’s Fair Market Rent.

Program Specifics:
The Section 8 Mod Rehab SRO program is a project-based rental assistance program. HUD contracts with PHAs to make rental assistance payments to landlords who complete moderate rehabilitation of their properties and then rent them to homeless individuals. HUD’s payments
cover the difference between a portion of the tenant’s income (normally 30 percent), and the unit’s eligible rent.

Rental assistance contracts for the SROs are provided for ten years, with the option to renew the contract through the Section 8 program. Property owners are required to perform a minimum of $3,000 in rehabilitation work per SRO unit (which may include a prorated share of
work on common areas or systems).

The program does not provide financing for rehabilitation, but allows  for a portion of the cost of the rehabilitation to be reflected in the rent levels allowed for the units.


Background:
The Section 8 Mod Rehab SRO is a federal grant program authorized by the Stewart B. McKinney Homeless Assistance Act of 1987, now called the McKinney/Vento Homeless Assistance Act. This legislation created three U.S. Department of Housing and Urban Development (HUD) programs that can be used to develop permanent housing for homeless individuals and families with disabilities: the Shelter Plus Care program (S+C), the Supportive Housing Program (SHP), and the Section 8 Mod Rehab SRO Program. These three programs form the backbone of the Continuum of Care.

For more information:
A Guide to Continuum of Care Planning and Implementation

Frequently Asked Questions:
Who can apply for Section 8 Mod Rehab SRO funding?
What is the Application Process?
Who is eligible for Section 8 Mod Rehab SRO programs?
How long do Section 8 Mod Rehab SRO grants last?



Who can apply for Section 8 Mod Rehab SRO funding?
Public Housing Agencies and non-profit organizations. Non-profit organizations must contract with a PHA to administer the subsidy, but only through the Continuum of Care process.

Application Process
McKinney/Vento Homeless Assistance funds are awarded to organizations participating in their state or local Continuum of Care planning process. These funds (including Section 8 Mod Rehab SRO) are awarded through an annual national competition that's announced as a part of HUD's SuperNOFA (Notice of Funding Availability).

Who can participate in Section 8 Mod Rehab SRO programs?
Any person who meets HUD's definition of "homeless" for McKinney programs and who is or will be living in a single room dwelling that was rehabilitated or acquired using Section 8 SRO funds is eligible for rental assistance. For purposes of the McKinney/Vento programs, HUD considers a homeless person someone who:

  • Is living in places not meant for human habitation (streets, cars, parks, etc.);
  • Is living in an emergency shelter;
  • Is living in transitional or supportive housing but originally came from the streets or shelter;
  • Is living in any of the above but spending up to 30 consecutive days in an institution;
  • Is being evicted within a week and has no subsequent residence;
  • Is being discharged within a week from an institution (e.g., mental health or substance abuse facility or jail/prison) in which the person has been a resident for more than 30 consecutive days and no subsequent residence has been identified and the person lacks the resources and support networks needed to obtain housing; or
  • Is fleeing a domestic violence situation and no subsequent residence has been identified.
  • Funds can be used to
  • Rehabilitate properties;
  • Convert properties into single room dwellings; or
  • Acquire properties that will be used (or rehabilitated to use) as single room dwellings.

How long do Section 8 Mod Rehab SRO grants last?
The Section 8 Mod Rehab SRO grants are for 10 years. At the end of 10 years, these grants are renewed through HUD's Section 8 appropriation and do not have to seek funding through the Continuum of Care application process.