EIR (Excess Income Receivables) Collections

For those unfamiliar with Section 236 requirements, landlords are only allowed to keep the HUD-approved Basic Rent.  Any amounts over Basic collected from tenants (i.e. those who pay between Basic and Market Rent) must be remitted to HUD, unless sites have gotten HUD approval to keep the funds (usually for items like building repairs and upgrades).  This approval must be renewed each year.

EIR Reports (along with appropriate payment, if any) must be submitted, electronically, every month, whether money is due to HUD or not.  EIR Reports list the actual amounts collected from tenants for the month.  Since properties deposit tenant payments into their Operating Accounts, a change in ownership has no effect on the amounts due.

Each HUD MF Hub Director is being asked to appoint a Collection Coordinator and an alternate.  By March 10, 2012 any 236 site with overdue funds should expect a Demand Letter requiring that the funds be paid within 30 days, or that the Owner/Agent contact the Coordinator to work out a payment plan.  If that’s not done within 90 days, the site may be referred to the DEC (Departmental Enforcement Center) for further action, which may include stiff financial penalties and/or suspension from all federal programs.

There are further procedural details regarding the repayment agreements and submissions in the Notice.